MERAFE RESOURCES LIMITED - Production report and trading statement

Production report and trading statement

Merafe Resources Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1987/003452/06)
JSE share code: MRF
ISIN: ZAE000060000
(“Merafe” or the “Company”)

PRODUCTION REPORT AND TRADING STATEMENT


1.   Production Report

     Merafe’s attributable ferrochrome production from the Glencore Merafe Chrome Venture for the
     year ended 31 December 2017 increased marginally compared to the prior year.


                                                     2017           2016           2017          2016
                                                    Fourth         Fourth
                                                    quarter        quarter      Full Year      Full Year
      Attributable ferrochrome production (kt)        109            107          395            393

2.   Trading Statement

     Basic and headline earnings per share

     In terms of the JSE Limited Listings Requirements, issuers are required to publish a trading
     statement as soon as they are satisfied that a reasonable degree of certainty exists that the
     financial results for the period to be reported on will differ by at least 20% from those of the prior
     comparative period.

     Shareholders are therefore advised that Merafe is expecting to report the following for the year
     ended 31 December 2017:


     •     basic earnings per share of between 34.5 cents and 38.5 cents, compared to 21.2 cents for
           the prior year, which is an increase of between 63% and 82%; and
     •     headline earnings per share of between 34.5 cents and 38.5 cents compared to 21.2 cents
           for the prior year, which is an increase of between 63% and 82%.

     The significant increase in earnings per share is primarily driven by substantially higher chrome
     ore and ferrochrome prices which were partially offset by:

     •     lower chrome ore and ferrochrome sales volumes;
     •     stronger average Rand compared to US Dollar exchange rate; and
     •     an increase in total costs per tonne of ferrochrome and chrome ore sold.


    Expected cash and debt balances – Merafe Resources Limited Group

                                                                        31 Dec 2017      31 Dec 2016
                                                                                R’m              R’m
     Cash and cash equivalents balance                                          672               263
     Merafe's 20.5% of the Venture's debtor’s facility                          (72)            (309)
     ABSA and Standard Bank debt*                                                  -            (363)
     Net cash/(debt)                                                            600             (409)


    *The debt balance that was outstanding at the end of 2016 was settled in full during 2017.


    Shareholders are advised that the financial information on which this trading statement is based,
    has not been reviewed or reported on by Merafe`s external auditors and is provided in terms of
    paragraph 3.4(b) of the JSE Limited Listings Requirements. The financial results for the year ended
    31 December 2017 are expected to be released on SENS on 5 March 2018.



Sandton
29 January 2018


Sponsor
One Capital

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