Zimplats revenue slumps

HARARE - Zimbabwe Platinum Mines Limited (Zimplats) recorded a marginal decline in revenue to $472 million in the year ended June 2013 down from $473 million realised in comparable period on the back of rising costs and depressed metal sales.

The group, led by chief executive Alex Mhembere, said total operating costs for the year - excluding share based payments - penalties on prior years tax and community development contributions, amounted to $347 million, up 14 percent on the previous year’s $305 million.

“This was due to increased production volumes in conjunction with higher cost of production driven by inflation and inefficiencies associated with operating the concentrators at lower mass pull. As a result, operating cash cost per platinum ounce increased by five percent to $1 287,” Mhembere said.

The miner — 87 percent owned by Johannesburg Stock Exchange-listed Impala Platinum Mines — said gross revenue per platinum ounce at $2 432 was four percent lower than the previous year due to lower metal prices.

Zimplat’s profit after tax for the year decrease of 44 percent to $68 million from $122 million recorded in the previous year, while earnings per share also declined significantly from 113,68 cents in 2012 to 63,41 cents this year.

“Cash generated from operations decreased by 30 percent to $162 million from $240 million in the previous period due to lower metal prices.

“At year end, Zimplats had bank borrowings amounting to $105 million and a cash balance of $4 million,” said Mhembere.

During the period under review, ore mined for the year at 4,79 million tonnes was five percent above the previous year with the main increase in contribution coming from the Mupfuti Mine during the development of the decline.

Mhembere noted that the production at Ngwarati and Rukodzi mines was marginally lower than in the previous year at 1,28 million tonnes and 1,32 million tonnes respectively, mostly as a result of a higher occurrence of bad ground conditions.

Bimha Mine produced 1,96 million tonnes, the same level as in the previous year’s performance.

“A low angle shear has been intersected in the mine and steps taken to mitigate the safety risk.

“This has reduced the number of faces available for mining which could lead to a decrease in production from this portal,” he said.

Mupfuti Mine (under development) performed ahead of expectation, producing 230 000 tonnes from capital spine development. At full capacity, the mine will produce 2 million tonnes per annum.

Average 4E head grade for the year remained unchanged at 3,32g/t.

Tonnes Ore milled for the year totalled 4,68 million tonnes, seven percent above the previous year’s 4,39 million tonnes.

Mhembere said this was mainly due to higher milling rates achieved at both concentrators and additional capacity at Ngezi following the commissioning of the Phase 2 concentrator in the final quarter of the year.

“The overall recovery rates at 82,7 percent were marginally better than the prior year’s performance despite reducing the mass pull for the two concentrators from 2,9 percent to 2,4 percent. This was achieved by increasing the dosages of reagents,” he said.

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