Implats in profit warning

HARARE - Zimbabwe Platinum Holdings (Zimplats) parent company Impala Platinum Holdings (Implats) says it expects its basics earnings per share (EPS) to decline by 30 percent in the half year to December 2015 due to the decline in international metal prices.

The south African platinum producer — with an 87 percent shareholding in Zimplats —  on Monday advised shareholders that headline earnings per share (Heps) for the half year ended December 2015 could be between 50 and 59 cents which is between 20 percent and 10 percent lower than that of the half year ended December 2014.

“The difference between EPS and Heps for the six months to December 2015 is primarily due to the impairment of the 12 Shaft mechanised section, which, as announced in September 2015, was closed in December 2015,” the company said.

Implats noted that the decline in Heps was primarily due to the lower rand metal prices, which were 15 percent lower than the previous comparable period ended December 2014.

This comes as Zimplats, which was established by Delta Gold Limited in 1998 to take over its platinum interests, recently reported a loss after royalties of $1, 7 million in the quarter to December from a profit of $5, 9 million previously.

The country’s largest platinum miner also saw its revenue decreasing by 11 percent to $96, 3 million on reduced sales and falling commodity prices.

In May 1999, the company purchased BHP’s interests in the Hartley Platinum and the Mhondoro Platinum Joint Ventures which included a concentrator and smelter.

Zimplats initiated the Ngezi/Selous Metallurgical Complex (SMC) project in 2001 and the first converter matte was exported in April 2002.

In 2001, Implats acquired a 30 percent stake in Zimplats from Delta in a joint venture with ABSA Bank Limited of South Africa (Absa).

Implats held pre-emptive rights over Absa’s 15 percent stake as well as a 30 percent direct stake in the then Makwiro Platinum (Pvt) Limited.

The remaining 70 percent was held by Zimplats.

In August 2002, the group acquired a further 21 percent stake in Zimplats from Aurion Gold and in June 2003 purchased Absa’s 15 percent stake.

Implats subsequently made an unconditional cash offer to minority shareholders in Zimplats.

Currently the group holds 87 percent as a result of the buyout of minority holders and the receipt of 14,9 million ordinary Zimplats shares issued in 2006 on the sale of its 30 percent stake in Zimbabwe Platinum Mines (Pvt) Limited (formerly Makwiro Platinum (Pvt) Limited) to Zimplats.

Zimplats commenced production at the Ngezi opencast mine in December 2001. However, due to the increase in opencast contractor mining costs, Zimplats decided to reduce the volume of opencast tonnes mined replacing them with underground tonnage from the Portal 2 underground mine which employs the conventional bord and pillar mining method.

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