Bushveld Minerals Limited's (LON:BMN) Shift From Loss To Profit

Bushveld Minerals Limited (LON:BMN) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Bushveld Minerals Limited operates as an integrated primary vanadium and energy storage solutions provider for the steel, energy, and chemical industries in South Africa, Europe, Asia, the United States, and internationally. With the latest financial year loss of US$104m and a trailing-twelve-month loss of US$117m, the UK£12m market-cap company amplified its loss by moving further away from its breakeven target. As path to profitability is the topic on Bushveld Minerals' investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Bushveld Minerals

Expectations from some of the British Metals and Mining analysts is that Bushveld Minerals is on the verge of breakeven. They expect the company to post a final loss in 2025, before turning a profit of US$5.3m in 2026. So, the company is predicted to breakeven approximately 2 years from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 82% is expected, which signals high confidence from analysts. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

We're not going to go through company-specific developments for Bushveld Minerals given that this is a high-level summary, though, bear in mind that by and large a metal and mining business has lumpy cash flows which are contingent on the natural resource mined and stage at which the company is operating. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

One thing we would like to bring into light with Bushveld Minerals is it currently has negative equity on its balance sheet. This can sometimes arise from accounting methods used to deal with accumulated losses from prior years, which are viewed as liabilities carried forward until it cancels out in the future. These losses tend to occur only on paper, however, in other cases it can be forewarning.

Next Steps:

This article is not intended to be a comprehensive analysis on Bushveld Minerals, so if you are interested in understanding the company at a deeper level, take a look at Bushveld Minerals' company page on Simply Wall St. We've also compiled a list of key factors you should further examine:

1. Valuation: What is Bushveld Minerals worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Bushveld Minerals is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Bushveld Minerals’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.