Dual-listed Wolf Minerals (ASX:WLF,LSE:WLFE) fell more than 5 percent on Tuesday (October 3) after posting an 18-percent increase in pre-tax losses for its tungsten-tin Drakelands mine in the UK.

The company recorded a loss of AU$74.6 million in the 2017 financial year, up from AU$62.7 million the year prior, but said it has been encouraged by improvements in the tungsten market.

“The tungsten market improved slowly during the first half of the year before building momentum at the end of the financial year,” Chairman John Hopkins said in a press release.

Tungsten prices have surged over 44 percent this year due to reduced supply from top producer China. The Asian country has been fighting pollution by closing down mines and enforcing production quotas.

“The very limited new supply of tungsten coming to market in recent years is expected to support prices at higher levels as demand continues to grow,” Hopkins added.

Wolf’s flagship asset, Drakelands, is one of the UK’s few active mines, and is the world’s fourth-largest producer of tungsten. The metal is used in cemented carbide, alloys and other construction applications.

“The board is encouraged by the recent price strength and the potential for longer term market equilibrium at these higher prices, providing Wolf with the opportunity to maximise its strategic value,” Hopkins commented.

The company also reported an increase in revenue to AU$24.7 million from AU$8.6 million the previous year. Cost of sales rose to AU$76.4 million from AU$50 million year-on-year.

In the coming financial year, Wolf Minerals’ initial focus will be to complete its “operating turnaround plan” to improve availability, throughput and recoveries in a safe and sustainable manner at Drakelands.

Some concerns about the plan surfaced in September, when the company extended its credit facility for the project with its biggest investor, Resource Capital.

“I’d be surprised if the tungsten price rise alone can save them. You’d have to say it’s going to be difficult. The question is: if at the end of this [turnaround] it’s not generating cash, then what happens next?” Martin Potts, analyst at FinnCap, said at the time.

On Tuesday, Wolf Minerals closed down 5.56 percent in Sydney, at AU$0.09, and down 0.95 percent on the LSE, at GBX 5.20. The company has surged about 20 percent since the beginning of the year.