Champion Iron (ASX:CIA): Record Ore Sales Contrast With Quarterly Loss

Aditi Sarkar

29 October 2026 05:58 PM AEDT

Champion Iron (ASX:CIA): Record Ore Sales Contrast With Quarterly Loss

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Highlights

Consolidated iron ore concentrate sales reached 4.49 million dry tonnes.
The September 2026 quarter produced a net loss of C$48.4 million.
Revenue fell to C$403.9 million despite higher sales volume.
The direct reduction pellet feed project completed its first commercial shipment.
Freight, selling prices and costs affected reported margins.

Champion Iron Limited (ASX:CIA) produces high-purity iron ore concentrates through mining operations in Canada and Norway. For the three months ended 30 September 2026, the company recorded its highest quarterly consolidated sales volume while reporting a net loss. Its second-quarter FY27 figures show the distinction between tonnes shipped and the financial return achieved on those shipments.

Sales records alongside lower revenue

Champion Iron (ASX:CIA) sold 4.49 million dry metric tonnes of concentrate in the second quarter of FY27, up 17 per cent on the corresponding quarter. Consolidated production reached 3.87 million wet metric tonnes, an increase of 9 per cent year on year. Sales volumes were higher than production, reflecting movements in finished product inventories and shipments.

Bloom Lake in Quebec contributed 3.32 million wet tonnes of production and sold about 3.91 million dry tonnes. Its inventory fell to approximately 1.0 million wet tonnes from 1.7 million. The company’s Rana Gruber operation in Norway contributed about 0.55 million wet tonnes of output and 0.59 million dry tonnes of sales. Champion Iron (ASX:CIA) acquired Rana Gruber on 10 April 2026, so its contribution is also relevant to the composition of the group’s current results.

Why earnings diverged from tonnes shipped

Revenue for the quarter was C$403.9 million, down 18 per cent from the prior corresponding period, including C$54.3 million attributable to Rana Gruber. EBITDA was C$3.7 million and adjusted EBITDA was C$23.3 million, versus C$174.8 million of adjusted EBITDA a year earlier. The statutory net loss was C$48.4 million, equivalent to C$0.09 per share, while the adjusted net loss was C$34.3 million. Adjusted measures differ from the statutory result and should not be treated as interchangeable.

Champion Iron (ASX:CIA) reported a gross average realised price of US$105.5 per dry tonne, compared with an average P65 index price of US$112.8. After freight and other adjustments, its net average realised price was C$89.9 per dry tonne, 30 per cent lower year on year. Freight and related costs climbed 39 per cent to US$40.4 per dry tonne. The C1 cash cost was C$82.9 per dry tonne and all-in sustaining cost reached C$97.9 per dry tonne, producing a negative C$8.0 per dry tonne cash operating margin.

Liquidity and direct-reduction investment

Cash at 30 September stood at C$214.4 million, excluding unused partner contributions within the Kami Partnership. Available liquidity was C$618.4 million, including C$404.1 million of undrawn credit facilities. Sustaining capital spending amounted to C$53.6 million during the quarter.

The direct reduction pellet feed, or DRPF, project completed its first commercial shipment of higher-grade iron ore material. The company reported approximately 0.6 million wet tonnes of DRPF production for the quarter and C$6.9 million in start-up costs. Spending on that project was C$3.2 million in the quarter, taking cumulative investment to C$497.0 million. Champion Iron (ASX:CIA) scheduled further test cargoes and commercial agreements for the third quarter of FY27; these are planned activities rather than completed sales.

Operational exposures remain

The company highlighted price volatility, elevated shipping rates, fuel costs and the costs of ramping up DRPF production. It also referred to the expiry of temporary relief concerning debt covenants. These factors may influence financial and operational reporting even when sales tonnage remains elevated.

Key Insights

Champion Iron (ASX:CIA) demonstrated that record shipment volumes do not necessarily translate into reported profit. The combination of lower net selling prices, higher freight expenses and project start-up costs accompanied a net loss in the September quarter. Future updates will clarify DRPF product qualification, freight exposure and the relationship between sales volumes and margins.

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