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Fox Marble Holdings PLC

Fox Marble see significant increase in sales of material in H1

Fox Marble Holdings (AIM: FOX), the dimension stone company focused on marble quarrying and finishing in Kosovo and the Balkans, has today announced its interim results for the six months ended 30 June 2019.

Operational Highlights 

·   Revenue from the sale of marble products for the six months to 30 June 2019 increased 63 % to €1.0 million (H1 2018: €615k), driven by an increase in sales of block material from the Prilep quarry in Macedonia.  Sales of Alexandrian White and Alexandria Blue blocks increased to €0.6 million from €0.2 million in the same period in 2018, to a range of block wholesalers across Europe and further afield. 

·    Production in the six months to 30 June 2019 rose 74% to 9,529 tonnes from 5,473 tonnes in 2018.  This significant increase in the production over this period reflects capital investment made in the quarries to date.  

·    Capital investment of €550k made in the Prilep Alpha quarry, to drive increased levels of production and to support the delivery of material under the new sales contracts, has proved successful.  The production at the Prilep Alpha Quarry was 8,433 tonnes in the eight months to 31 August 2019 an increase of 225 % on the prior year (31 August 2018: 2,592 tonnes).   

·    The factory continues to operate successfully without interruption producing slabs, tiles, steps and other bespoke materials with increasing sales expected within the second half of the year. 

·    Appointment of two new members of the senior leadership team – Don Nicolson, as Senior Advisor and Francisco Espinosa as Chief Operating Officer.   Both individuals bring a wealth of experience to the Company, particularly in the marble sector, to help navigate the next period of growth.

·   Launched €195 million arbitration claim against the Republic of Kosovo pursuant to Article 16 of the Kosovo foreign investment law.

Financial Highlights

·   Operating loss for the six months to 30 June 2019 of €0.7 million (six months to 30 June 2018: €1.0 million)

·     Loss for the six months to 30 June 2019 of €0.8 million (six months to 30 June 2018: €0.8 million)

·     Cash balance as at 30 June 2019 of €0.7 million (31 December 2018: €0.4 million).  Cash balance as at 26 September 2019 of €0.6 million.

Chris Gilbert, CEO, commented: “The first half year has seen a significant increase in sales of our material from the first half of 2018 with the emphasis on our white marble from the quarry in Macedonia producing sustainable revenues as production increases.

“The impact of the suspension of operations in the M3 quarry in Kosovo is being mitigated by our increased focus on the sales of processed material from our factory. We are seeing an encouraging pipeline of sales from around the world and demand for our marble in projects in places such as Cyprus, Dubai and domestically in the Balkans.  We expect to see an increase in sales of our processed marble from our factory in the second half of this year.”

“The appointment of Don Nicolson and Francisco Espinosa will significantly add to the senior management team’s capability and Francisco’s remit, which includes his role as Head of Sales, will contribute directly to our bottom line. Their expertise and ability is a welcome addition to the Fox team and will be reflected in the Company’s growth moving forwards.”

Operational Update

Sales and Marketing

Sales for the six months to 30 June 2019 increased by 63% to €1.0 million from €0.6 million in the same period in 2018.   The increase in sales has been driven by an increase in block marble sales.    

In the first half of the year the Company saw the continuation of large volume block sales to wholesalers primarily in China, Turkey and Europe.   

Sales of Alexandrian White and Alexandrian Blue block marble saw a significant increase through the first half of the year to a varied customer base across Europe and further overseas, with revenues from this quarry increasing from €0.2 million in 2018 to €0.6 million in 2019.    

As previously announced, the Company secured its biggest single order for its prized Alexandrian White marble. This order has been placed by the Swaminarayan Hindu religious order who are building a temple in Abu Dhabi on land donated by the Royal family of the UAE.

Fox Marble is providing bespoke cut to size marble varying in size from small blocks to large beams which will be shipped by the temple to India to be hand carved and shipped to the temple site and has received the schedule for the first shipment to be shaped and sent to India.

Fox Marble has received a minimum firm commitment for this material to be supplied during 2019 and 2020. The minimum value of this order is expected to be $2.4 million and of which Fox has recognized $0.1 million to date in revenues, with further shipments expected over the remainder of the year.


A 5,400 square metre double skinned steel factory for the cutting and processing of blocks into polished slabs and tiles has been erected on a 10-hectare site that the Company acquired in Lipjan in 2013, close to Pristina airport in Kosovo.

The Italian Gravellona Machine Marmo Computer Numerical Control (“CNC”) machine installed in 2018 and continues to produce tiles, steps and other bespoke cut to size products.   Operating processes have been consistently refined and the factory is now operating two full shifts per day all year round.

The factory continues to operate in good order, and the local market for processed marble is developing.  Over the last six months, the factory has operated efficiently producing slabs, tiles, steps and other bespoke materials with increasing sales expected within the second half of the year.


Quarry Operations at Prilep in Macedonia continue to develop strongly with production in the six months to 30 June 2019 of 6,562 tonnes (2018: 1,928 tonnes).  The Prilep quarry produces Alexandrian White and Alexandrian Blue marble, both of which are proving popular within the international block market.  The quarry continues to develop well with signs of increasing quality and whiteness as the quarry depth increases, which will further improve margins.

Capital investment of €550k made in the Prilep Alpha quarry, primarily in the form of new equipment, to drive increased levels of production and to support the delivery of material under the new sales contracts has been successful.  Production continues strongly in second half of the year with production of 8,433 tonnes in the eight months to 31 August 2019 an increase of 225 % on the prior year (31 August 2018: 2,592 tonnes).   

The Cervenillë and Syriganë quarries are well developed quarries where significant volumes of high quality material have been extracted.  The Cervenillë quarry is open across three separate locations (Cervenillë A, B & C) from which red (Rosso Cait), red tinged grey (Flora) light and darker grey (Grigio Argento) marble is produced. 

The quarry at Syriganë is open across four benches. The site contains a variety of the multi-tonal breccia and Calacatta-type marble and produces significant volumes of breccia marble in large compact blocks.  Output is marketed as Breccia Paradisea (predominantly grey and pink) and Etrusco Dorato (predominantly gold and grey).

These materials have all been used in high end developments.  In the UK these include, among others, St George’s Homes and Capital and Counties Plc’s Lillie Square development.  In Sydney, Australia Rosso Cait and Breccia Paradisea marble have been used in what is expected to be Australia’s most expensive residential property. These sales serve to demonstrate the desirability of these marble products as the stone of choice in some of the most prestigious and expensive residential developments around the world.  The Company will use existing quarried stock to develop the large volume block market in these materials.

Production at the Maleshevë quarry was suspended in July 2019 due to the ongoing dispute with the former shareholders Green Power Sh.p.k, and giving rise to the Arbitration claim discussed above.


Fox Marble issued 13,263,161 new ordinary shares in the Company at 9.5p per share on 7 February 2019. Gross proceeds of this issue of equity amounts to £1,260,000. The New Ordinary Shares rank pari passu with the existing ordinary shares. 

Fox Marble issued a further £700,000 in Convertible Loan Notes under the same terms as existing Loan Notes issued by the Company. The Convertible Loan Notes will carry an interest rate of 8%, per annum. The Convertible Loan Notes are due for conversion or repayment on 4 February 2021 with a conversion price set at 10.5p.

New Appointments

Don Nicolson has been appointed to the role of Senior Advisor with immediate effect. He will provide advice on strategy, business planning and performance improvement. It is intended that Don will join the board of Fox Marble Holdings Plc as Vice Chairman and Non-Executive Director in due course providing increased capacity and capability to the business.  

Don Nicholson is a senior business leader with over 35 years’ experience in the extractive industries (oil, gas, mining and natural stone). He has held multiple Board and senior executive roles both in the UK and internationally. This included 26 years with BP where he ran oil and gas businesses in the UK, United States and Canada. Some of his key roles included being Director North Sea, Chief of Staff to BP CEO (E&P) and VP BP Alaska. He also has significant Board level experience in mining, both in the UK and South Africa including CEO and Executive Vice Chairman roles.

One of Don’s most recent roles was that of Chairman, and interim CEO of Levantina – The Natural Stone Company, headquartered in Spain. Levantina is a world leader in the quarrying, processing and marketing of natural stone. It is one of the largest companies in the sector, operates several quarries including El Coto, believed to be the largest Crema Marfil quarry in the world. The company distributes and markets natural stone products to multiple countries around the world.

As announced on the 27 September 2019, Francisco Espinosa has been appointed to the role of Chief Operating Officer to the Company in a non-Board capacity from the 1 October 2019. His role will be the executive management of all the operations of Fox Marble with specific emphasis on sales as Head of Sales worldwide, as well as the operational efficiency of the quarries and the factory.

Francisco has already visited the quarrying operations in Kosovo and Macedonia and spent time in the factory identifying areas of improvement. He is preparing a thorough strategic review in conjunction with Fox Marble’s recently appointed Senior Advisor Don Nicolson and will remain focussed on marketing sales and distribution.

Francisco has worked for Levantina Y Asociados de Minerales S.A.U., for 12 years, rising to the level of Chief Operating Officer. In this role Francisco was responsible for 600 employees and accountable for seven factories, including marble, granite and ceramic factories.  He also holds an MBA from the European School of Business in Madrid. He has in previous times worked for Caterpillar, ITT Industries and ENEBE Sports Group.

Dispute and Arbitration Claim

On 4 September Fox Marble launched United National Commission on International Trade Law (UNCITRAL) arbitration proceedings, against the Republic of Kosovo for damages in excess of €195 million, as a result of the failure of the State to protect Fox Marble’s rights over the Maleshevë quarry.

The Company believes the Kosovan Government to be in clear breach of its responsibilities towards the Company as a foreign investor in Kosovo and that this action is in the best interests of its shareholders and employees. The Company anticipates a fair and satisfactory resolution. 

All the Company’s other operations, including the quarries and processing factory in Kosovo and the Prilep quarry in Northern Macedonia, are unaffected.

The background to the claim is the dispute arising with the former shareholders of Green Power Sh.p.k and Scope Sh.p.k, which has resulted in Fox Marble being prevented from operating the Maleshevë quarry.  Since the dispute arose Fox Marble has been working to resolve the matter with the appropriate Kosovan Government agencies, namely the Kosovo mining regulator, the Independent Commission of Mines and Mineral (“ICMM”) and the Agjencia e Regjistrimit të Bizneseve (“ARBK”), the Kosovo business registration agency. However, in what is a clear breach of Kosovo Law 04/L-220 “On Foreign Investment” (2014), Fox Marble has been prevented from asserting its rights in these matters.

Despite the cumulative weight of evidence, Fox Marble was denied the right to appeal any decision relating to the Maleshevë quarry in direct contravention of the provisions of the Kosovo foreign investment law, Law 04 /L-220.

As a direct consequence of the ARBK and ICMM decisions, the Company has brought arbitration proceedings against the Republic of Kosovo pursuant to Article 16 of the Kosovo foreign investment law (as above). The basis of the claim for damages is the investment made to date in the Maleshevë quarry, loss of future revenues associated with the site and future investment plans in Kosovo. Significant future investment plans are the subject of the MOU signed in October 2016 by the Government of Kosovo and Stone Alliance LLC which is majority owned by Fox Marble.

The Company is represented by its legal advisers, Stephenson Harwood LLP, as well as its Kosovan lawyers. 

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Disclaimer: Statements in this article should not be considered investment advice, which is best sought directly from a qualified professional.