Platmin Limited - Metal sales at record high in second quarter
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TORONTO, Aug. 15, 2011 /CNW/ --
Illegal disruptions set back production build-up
TORONTO, Aug. 15, 2011 /CNW/ - Platmin Limited ('Platmin' or 'the
Company') today announced production results from the Pilanesberg
Platinum Mine ('PPM') and financial results for the quarter and
half-year ended June 30, 2011. This release should be read in
conjunction with the Company's June 30, 2011 Quarterly Financial
Statements and Management Discussion & Analysis for the quarter and
half-year ended June 30, 2011, both of which are available at www.platmin.com and filed on www.sedar.com.
Operations
Sales of 4E PGM ounces ('oz') were as follows:
-- For the June 2011 month - 9,258oz or about 110 000oz
annualized;
-- for the quarter ended June 30, 2011 - 21,888oz, an increase of
over 100% compared with 10,870oz in the prior corresponding
period; and
-- for the half-year ended June 30, 2011 - 39,791oz, an increase
of 58% compared with 25,259oz in the prior corresponding
period.
Volumes treated in the concentrator continue to improve. Between January
and June 2011, the monthly tonnes milled increased from 207kt to 277kt
and improvements to recoveries are evident when consistent ore volumes
with similar physical and chemical properties are processed.
On June 23, illegal disruptions by a small group of employees of the
Company's mining contractor (MCC - a wholly-owned subsidiary of Eqstra
Holdings Limited) resulted in serious damage to certain items of MCC's
equipment and interrupted mining operations. However, PPM's
concentrator continued to operate, processing stockpiles of oxidized
material.
Mining operations have resumed in full for the three operating shifts
per day. However, as a direct consequence of the equipment damage and
the reorganisation described below, the projected production ramp-up to
12,000oz per month by the end of 2011, could be delayed by three to six
months.
The final documentation for the revised environmental management plan
has been submitted to the Department of Mineral Resources and a reply
is expected during Q3 FY2011.
Financial performance
Sales revenue was:
-- for the quarter-ended June 30, 2011 - US$34.5 million, an
increase of approximately 130% compared with US$15.0 million
recorded in the prior corresponding period; and
-- for the half-year ended June 30, 2011 - US$60.5 million, an
increase of approximately 80% compared with the prior
corresponding period.
The increases in sales revenues were due to higher metal sales and an
increase in PGM basket prices in US dollar terms over the period.
However, the benefit of the improved US dollar PGM basket price was
somewhat offset by the strength of the Rand, resulting in marginal
decreases of the Rand PGM basket prices received compared with the
prior corresponding periods.
The Company recorded net losses for the quarter and half-year ended June
30, 2011 of US$23.2 million and US$58.0 million respectively,
equivalent to losses per share of US$0.02 and US$0.05.
The Company is evaluating the merit of its current listings on the TSX,
AIM and JSE and the potential merits of alternatives.
Outlook
Tom Dale, CEO of Platmin noted that although work had resumed in the
Tuschenkomst pit, a focus on sound industrial relations and long-term
industrial peace was required. 'MCC, the mining contractor, and the NUM
have committed to this and external agencies, skilled in relationship
building, are being brought in,' he said.
'MCC has indicated that it is currently unable to haul the volumes of
rock budgeted at the PPM site due to extensive damage to the fleet. As
a result, PPM intends bringing in an additional mining contractor.
'In order that PPM, MCC and the new contractor might focus on core
competencies, separation of drilling, blasting and load and haul
activities is being discussed. Load and haul would be further separated
into waste and reefing operations. PPM plans to take direct control of
drilling and blasting in order to optimize mineral resource management
and improve pit conditions.
Mr Dale continued, 'The planned changes could take up to six months to
implement and will create clear areas of accountability among the
various parties. Prior to the industrial action, we were on our way to
achieving breakeven and full production. We are confident that, once
the revised operating structures are functioning, we will get back on
track.'
Cautionary note regarding forward-looking statements
This market release contains 'forward-looking information' which may
include, but is not limited to, statements with respect to the future
financial and operating performance of Platmin Limited (the 'Company'
or 'Platmin'), its subsidiaries and affiliated companies (which
together with Platmin is referred to as 'the Platmin Group' or 'the
Group'), and its mineral projects, the future price of 4E PGMs (being
platinum, palladium, rhodium and gold), 4E PGM production levels,
mining rates, the future price of other base metals, future exchange
rates, the estimation of mineral resources and reserves, the
realization of mineral resource estimates or their conversion into
reserves, costs and future costs of production, capital and exploration
expenditures, including ongoing capital expenditure at PPM, costs and
timing of the development of new deposits, costs and timing of the
development of new mines, costs and timing of future exploration,
requirements for additional capital, government regulation of mining
operations and exploration operations, timing and receipt of approvals,
licenses, and conversions under South African mineral legislation,
environmental risks, title disputes or claims, limitations of insurance
coverage and the timing and outcome of regulatory matters. Often, but
not always, forward-looking statements can be identified by the use of
words such as 'plans', 'expects', 'is expected', 'budget', 'scheduled',
'estimates', 'forecasts', 'intends', 'anticipates', 'targeted' or
'believes' or variations (including negative variations) of such words
and phrases, or state that certain actions, events or results 'may',
'could', 'would', 'might' or 'will' be taken, occur or be achieved.
Forward-looking statements in this market release, amongst others,
forecast production reaching a monthly rate of 12,000 4E PGM ounces by
the end of FY2011 and 20,000 4E PGM ounces of by the end of FY2012
provided the planned volumes of waste stripping can be achieved;
lodging of an amended environmental management plan in August 2011;
recovery rates and grade; targets, estimates and assumptions in respect
of 4E PGM prices and production; allocation of funds for current
commitments; and the timing and completion of definitive feasibility
engineering studies at the Mphahlele, Grootboom and Loskop Projects.
Such forward-looking statements are based on a number of material
factors and assumptions, including, that contracted parties provide
goods and/or services on the agreed time frames, that budgets and
production forecasts are accurate, that equipment necessary for
construction and development is available as scheduled and does not
incur unforeseen break downs, that no labour shortages or delays are
incurred, that plant and equipment function as specified, that
geological or financial parameters do not necessitate future mine plan
changes, that no unusual geological or technical problems occur, and
that grades and recovery rates are as anticipated in mine planning.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements. Such factors include, among
others, general business, economic, competitive, political and social
uncertainties; the actual results of current exploration and mining
activities; development and operational risks; title risks; regulatory
risks; conclusions of economic evaluations and studies; fluctuations in
the value of the United States dollar relative to the Canadian dollar
or South African rand; changes in project parameters as plans continue
to be refined; future prices of 4E PGM metals; possible variations of
ore grade or recovery rates (including the existence of potholes,
faults and other geological conditions that may affect the existence or
recovery of resources and reserves); failure of plant, equipment or
processes to operate as anticipated; accidents, labour disputes,
industrial unrest and strikes and other risks of the mining industry;
political instability, insurrection or war; the effect of HIV/AIDS on
labour force availability and turnover; delays in obtaining
governmental approvals or financing or in the completion of development
or construction activities, as well as those factors communicated in
the section entitled 'Risk Factors' of Platmin's current annual
information form ('AIF') and its final short form prospectus dated May
5, 2010, which can both be viewed at www.sedar.com. Although Platmin
has attempted to identify important factors that could cause actual
actions, events or results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results to differ from those anticipated, estimated
or intended.
Forward-looking statements contained herein are made as of the date of
this market release and Platmin disclaims any obligation to update any
forward-looking statements, whether as a result of new information,
future events or results or otherwise. There can be no assurance that
forward-looking statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue reliance
on forward-looking statements due to the inherent uncertainty therein.
To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/August2011/15/c3724.html
Charmane Russell
Russell and Associates
27 11 880 3924
27 82 372 5816