Wrap Text
LONMIN PLC
RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2000
HIGHLIGHTS
FINANCIAL HIGHLIGHTS YEAR TO YEAR TO
30 SEPTEMBER 2000 30 SEPTEMBER 1999
RESTATED
PROFITS - CONTINUING OPERATIONS
(I) EBITDA - UP 153% $412M $163M
OPERATING PROFIT - UP 181% $380M $135M
PROFIT BEFORE EXCEPTIONAL
ITEMS - UP 209% $392M $127M
EARNINGS PER SHARE BEFORE
EXCEPTIONAL ITEMS - UP 152% 135.1C 53.7C
(II) DIVIDENDS PER SHARE 50.0C 29.1C
CASH FLOW - CONTINUING OPERATIONS
(III) TRADING CASH FLOW PER SHARE 200.0C 84.1C
(IV) FREE CASH FLOW PER SHARE 108.2C 32.6C
BALANCE SHEET
EQUITY INTERESTS $1,031M $733M
NET CASH/(BORROWINGS) $422M $(197)M
(V) GEARING NIL 20%
COMMENTING ON THE RESULTS, EDWARD HASLAM SAID: " THIS IS A STRONG PERFORMANCE
IN OUR FIRST YEAR AS A FOCUSED PRECIOUS METALS MINING GROUP. IN PARTICULAR, IT
WAS A TRULY OUTSTANDING YEAR FOR OUR PLATINUM OPERATION WHICH WAS THE ONLY
MAJOR PLATINUM PRODUCER TO INCREASE OUTPUT YEAR ON YEAR. THIS UNDERLINES OUR
CONFIDENCE IN THE ACCELERATED EXPANSION PROGRAMME WHICH SEES THE INVESTMENT OF
$550 MILLION OVER A 7 YEAR PERIOD PROJECTED TO RESULT IN A 43% INCREASE IN
PRODUCTION."
NOTES ON HIGHLIGHTS
(I)EBITDA - EARNINGS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION.
(II)A FINAL DIVIDEND OF 25.7P (36.0C) PER SHARE IS RECOMMENDED FOR PAYMENT ON
19 FEBRUARY 2001 TO SHAREHOLDERS ON THE REGISTERS ON 26 JANUARY 2001.
(III) TRADING CASH FLOW PER SHARE IS CALCULATED BY DIVIDING THE NET CASH FLOW
FROM OPERATIONS LESS TAX AND NET INTEREST PAID BY THE WEIGHTED AVERAGE NUMBER
OF ORDINARY SHARES IN ISSUE DURING THE YEAR.
(IV) FREE CASH FLOW PER SHARE IS CALCULATED BY DIVIDING THE TRADING CASH FLOW
LESS CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT AND MINORITY DIVIDENDS PAID
BY THE WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES IN ISSUE DURING THE YEAR.
(V)GEARING IS CALCULATED ON THE EQUITY AND MINORITY INTERESTS OF THE GROUP.
PRESS ENQUIRIES: ANTHONY CARDEW, CARDEW & CO - +44 (0)20 7930 0777
THIS PRESS RELEASE IS AVAILABLE ON HTTP://WWW.LONMIN.COM
CHAIRMAN'S STATEMENT
EARNINGS POWER OF THE COMPANY
MATERIALLY ENHANCED AS TRANSFORMATION
TOWARDS FOCUSED PLATINUM MINING COMPANY
IS SUBSTANTIALLY COMPLETED.
I AM PLEASED TO PRESENT THE REPORT AND ACCOUNTS FOR THE YEAR TO 30 SEPTEMBER,
2000 WHICH SHOW SUBSTANTIAL PROGRESS ON ALL FRONTS.
THE STATEMENT OF THE CHIEF EXECUTIVE, EDWARD HASLAM, COVERS OUR RESULTS FOR THE
YEAR IN DETAIL. IT IS APPROPRIATE THAT I SHOULD COMMENT ON THE STRATEGIC
BACKGROUND AGAINST WHICH THESE RESULTS SHOULD BE SEEN AND UPON RECENTLY
ANNOUNCED CHANGES TO THE EXECUTIVE MANAGEMENT OF THE COMPANY.
THE YEAR COVERED BY THIS REPORT REPRESENTS A LANDMARK IN THE HISTORY OF THE
COMPANY. IN 1996 NICK MORRELL WAS APPOINTED CHIEF EXECUTIVE WITH THE EXPRESS
REMIT TO GIVE FOCUS TO THE COMPANY AND RESTORE ITS FINANCIAL POSITION WHICH AT
THAT TIME HAD BECOME SERIOUSLY OVERSTRETCHED. FOLLOWING A STRATEGIC REVIEW THE
BOARD REACHED THE CONCLUSION THAT THE COMPANY SHOULD IN FUTURE CONCENTRATE ON
ITS PRECIOUS METALS MINING ACTIVITIES. THIS TOOK INTO ACCOUNT THE QUALITY OF
THE COMPANY'S MINING ASSETS AND ITS HUMAN AND FINANCIAL RESOURCES AS WELL AS
THE OUTLOOK FOR THE MINING SECTOR.
OVER THE PAST FOUR YEARS NICK HAS BEEN RESPONSIBLE FOR A COMPLETE RESTRUCTURING
AND REPOSITIONING OF THE BUSINESS. THIS HAS ENTAILED SOME 13 SIGNIFICANT
DISPOSALS AND THE DEMERGER OF THE COMPANY'S AFRICAN NON-MINING BUSINESSES AS A
SEPARATELY LISTED COMPANY. THE FRUITS OF THIS REPOSITIONING ARE NOW VERY
APPARENT. THE EARNING POWER OF THE COMPANY HAS BEEN TRANSFORMED, WE HAVE NO
CORPORATE DEBT, THE BUSINESS IS GENERATING SUBSTANTIAL CASH FLOWS AND WE ARE
ABLE TO UNDERTAKE A MAJOR INVESTMENT PROGRAMME IN OUR PLATINUM MINES IN SOUTH
AFRICA WITHOUT RECOURSE TO EXTERNAL FINANCE.
WE ARE PLEASED THAT THE SUCCESS OF THIS TRANSFORMATION IS NOW BEGINNING TO BE
RECOGNISED IN THE VALUE THAT THE MARKET PUTS UPON OUR SHARES AND THAT WE ARE
ABLE TO RECOMMEND A SUBSTANTIAL INCREASE IN THE FINAL DIVIDEND TO 36.0 CENTS A
SHARE TO BRING THE DIVIDEND FOR THE FULL YEAR TO 50.0 CENTS EQUIVALENT TO 35.0
PENCE A SHARE. THIS IS A 72 PER CENT INCREASE OVER THE DIVIDEND FOR THE
PREVIOUS YEAR IN US DOLLAR TERMS AND 96 PER CENT EXPRESSED IN STERLING. THE
DIVIDEND WOULD BE TWICE COVERED BY FREE CASH FLOW.
I SHOULD LIKE TO TAKE THIS OPPORTUNITY TO THANK NICK MORRELL ON YOUR BEHALF FOR
THE OUTSTANDING JOB HE HAS DONE IN LEADING THE TRANSFORMATION OF THE GROUP FROM
A SPRAWLING OVERSTRETCHED CONGLOMERATE JUST FOUR YEARS AGO TO THE SUCCESSFUL
AND FOCUSED COMPANY THAT IT IS TODAY; HE LEAVES WITH OUR BEST WISHES.
THE CHIEF EXECUTIVE COMMENTS IN HIS REVIEW ON DEVELOPMENTS RELATING TO OUR
INVESTMENT IN ASHANTI AND ON THE DIFFICULTIES WE ARE FACING IN OUR GOLD MINING
ACTIVITIES IN ZIMBABWE AS A RESULT OF POLITICAL AND ECONOMIC DEVELOPMENTS IN
THAT TROUBLED COUNTRY.
THE BOARD HAD BECOME CONCERNED ABOUT THE OUTLOOK FOR THE GOLD MINING INDUSTRY
AS A RESULT OF THE STEADY EROSION IN THE ROLE OF GOLD AS A RESERVE ASSET AND
HAD DECIDED SOME TIME AGO TO CONCENTRATE ON THE DEVELOPMENT OF ITS SUBSTANTIAL
PLATINUM GROUP METALS. THE MARKET IS ROBUST AND THE LONG-TERM OUTLOOK IS, WE
BELIEVE, VERY PROMISING. PLATINUM IS VERY MUCH A METAL OF THE FUTURE WITH NEW
HIGH TECH APPLICATIONS GEARED TO A WORLD WHICH IS INCREASINGLY CONCERNED ABOUT
ENVIRONMENTAL ISSUES; PLATINUM IS A KEY COMPONENT OF FUEL CELL TECHNOLOGY, AND
IN THE CATALYTIC CONVERTERS WHICH REMOVE POLLUTANTS FROM AUTOMOBILE EXHAUSTS.
WE EMPLOY SOME 24,000 PEOPLE IN THE GROUP, THE MAJORITY OF THEM IN OUR MINING
OPERATIONS IN SOUTHERN AFRICA. WE ARE ACUTELY CONSCIOUS OF THE IMPACT ON THEIR
LIVES OF THE TRAGIC INCIDENCE OF HIV AND AIDS RELATED DISEASE AND BELIEVE THAT
WE ARE AT THE FOREFRONT OF THE INDUSTRY IN DOING WHAT WE CAN TO RELIEVE THE
SUFFERING AND INHIBIT THE SPREAD OF THE DISEASE BOTH WITHIN OUR OWN WORKFORCE
AND IN THE COMMUNITIES IN WHICH WE OPERATE.
THE CHALLENGE NOW FACING THE COMPANY IS TO COMPLETE THE LARGE INVESTMENT WE
HAVE UNDERTAKEN IN OUR PLATINUM MINES IN SOUTH AFRICA ON TIME AND WITHIN BUDGET
AND TO SEEK OUT OPPORTUNITIES TO DEPLOY OUR SIGNIFICANT FINANCIAL RESOURCES BY
FURTHER ORGANIC GROWTH AND SELECTIVE ACQUISITION IN OUR CHOSEN MINING SECTOR;
IT IS IN THIS CONTEXT THAT I WELCOME ED HASLAM TO SUCCEED NICK MORRELL AS CHIEF
EXECUTIVE. ED HAS A WEALTH OF EXPERIENCE IN THE MINING SECTOR AND HAS BEEN
WITH THE GROUP IN SENIOR POSITIONS IN OUR PLATINUM OPERATIONS FOR NEARLY 15
YEARS; HE IS WELL QUALIFIED TO LEAD THE COMPANY FORWARD. FINALLY, YOU CAN BE
SURE THAT THE BOARD WILL NOT PURSUE ACRES AND OUNCES WITHOUT REGARD TO THE COST
OF CAPITAL AND THE RETURNS THAT CAN BE ACHIEVED. OUR CAPITAL COMMITMENT OF
$550 MILLION OVER THE NEXT SEVEN YEARS WILL ENSURE THE SUSTAINED EXPANSION OF
PRODUCTION AND THE CONTAINMENT OF COSTS LEADING TO THE ENHANCEMENT OF
SHAREHOLDER VALUE WHICH REMAINS OUR FIRST OBJECTIVE.
SIR JOHN CRAVEN
CHAIRMAN
CHIEF EXECUTIVE'S STATEMENT
OUR PLATINUM MINES HAVE ACHIEVED
LIFETIME RECORD PRODUCTION FIGURES
DURING THE YEAR AND ARE NOW POISED
TO PROVIDE FURTHER EXPANSION
OPPORTUNITIES FOR OUR CORE
BUSINESS ACTIVITY.
IT HAS BEEN AN OUTSTANDING YEAR FOR LONMIN WHERE, AS A RESULT OF SEVERAL YEARS
OF TRANSITION, PLATINUM GROUP METALS ARE NOW FIRMLY ESTABLISHED AS OUR CORE
BUSINESS. ALL PRODUCERS OF PLATINUM GROUP METALS BENEFITED FROM STRONG DEMAND
AND RISING PRICES, BUT IT WAS PARTICULARLY SATISFACTORY FOR LONMIN WHICH WAS
THE ONLY MAJOR PRODUCER TO RECORD A YEAR-ON-YEAR INCREASE IN PRODUCTION. IN
SPITE OF THE TORRENTIAL RAIN WHICH AFFECTED ALL THE PLATINUM MINES DURING THE
YEAR, LONMIN'S PRODUCTION OF ORE INCREASED BY 7 PER CENT AND OUR OPERATIONS
PRODUCED MORE REFINED METAL THAN EVER BEFORE.
I AM PLEASED TO REPORT THAT LONMIN'S PROGRESS WAS SUSTAINED THROUGHOUT THE
FINANCIAL YEAR AND PROVIDED A SPECTACULAR IMPROVEMENT IN OUR TRADING
PERFORMANCE. EARNINGS FROM OUR CONTINUING OPERATIONS BEFORE INTEREST,
DEPRECIATION AND TAX INCREASED BY 153 PER CENT, PROFIT BEFORE EXCEPTIONAL ITEMS
AND TAX INCREASED BY 209 PER CENT, AND EARNINGS PER SHARE INCREASED BY 152 PER
CENT. OPERATING MARGINS EXCEEDED 50 PER CENT BUT, AND ARGUABLY MOST
IMPORTANTLY, FREE CASH FLOW PER SHARE INCREASED BY 232 PER CENT TO 108.2 US
CENTS. AS THE CHAIRMAN REPORTED, THE PROGRESS WE HAVE MADE ALLOWS US TO
PROVIDE SHAREHOLDERS WITH A SUBSTANTIAL INCREASE IN THE DIVIDEND FOR THE YEAR.
OUR BALANCE SHEET, WHICH REFLECTS THE RECEIPT OF PROCEEDS FROM THE SALE OF
DUIKER MINING AND THE DISPOSAL OF THE FEW REMAINING NON-CORE BUSINESSES
TOGETHER WITH THE GENERATION OF SUBSTANTIAL CASH FROM THE PLATINUM OPERATIONS,
HAS NEVER BEEN STRONGER. NET CASH AT THE YEAR-END STOOD AT $422 MILLION ALMOST
ALL OF WHICH IS HELD IN US DOLLARS IN LONDON.
IN ORDER TO COMPLETE THE RESTRUCTURING OF THE BALANCE SHEET, THE GROUP'S
CONVERTIBLE BONDS WERE CALLED IN JUNE 2000 AND DUE TO THE STRENGTH OF THE SHARE
PRICE, WERE ALL CONVERTED IN JULY, RESULTING IN THE ISSUE OF AN ADDITIONAL 16.7
MILLION SHARES AND THE REMOVAL OF $163 MILLION OF DEBT. AS A RESULT, THE
GROUP, ARMED WITH A STRONG BALANCE SHEET AND, AT CURRENT METAL PRICES,
SIGNIFICANT CASH GENERATION, IS WELL PLACED TO FUND THE ACCELERATED EXPANSION
OF OUR PLATINUM OPERATIONS IN SOUTH AFRICA. THIS WILL SEE PRODUCTION RISING BY
43 PER CENT OVER A SEVEN-YEAR PERIOD TO AN ANNUAL RATE OF 870,000 OUNCES OF
PLATINUM. SINCE THIS EXPANSION, WHICH WILL COST APPROXIMATELY $550 MILLION,
WILL BE FUNDED FROM OPERATIONAL CASH FLOW, WE WILL HAVE THE NECESSARY FINANCIAL
RESOURCES TO PURSUE GROWTH BY ACQUISITION AS SUITABLE OPPORTUNITIES ARISE. OUR
EXPANSION PLAN AND WORKING COST BUDGET ARE ENDORSED AND SUPPORTED BY IMPALA
WITH WHOM OUR WORKING RELATIONSHIP CONTINUES TO BE CONSTRUCTIVE.
WHILE OUR PLATINUM OPERATIONS GREW STRONGLY, CONDITIONS WERE MORE CHALLENGING
FOR COMPANIES OPERATING IN THE GOLD SECTOR INCLUDING ASHANTI, IN WHICH YOUR
COMPANY RETAINS A 32 PER CENT INTEREST AND NOW ACCOUNTS FOR AS AN INVESTMENT
RATHER THAN AS AN ASSOCIATE. HOWEVER SINCE ASHANTI'S WELL-DOCUMENTED LIQUIDITY
CRISIS LAST YEAR, WHICH WAS PROMPTED BY A SPIKE IN THE GOLD PRICE, A BRIGHTER
OUTLOOK IS BEGINNING TO EMERGE. STEPS HAVE BEEN TAKEN THAT WILL REDUCE
ASHANTI'S DEBT. THEIR LATEST TRADING RESULTS FOR THE THIRD QUARTER OF THE
CURRENT FINANCIAL YEAR RECORD SOME ENCOURAGING PROGRESS AT THE OPERATING LEVEL,
PARTICULARLY AT OBUASI WHERE CASH OPERATING COSTS WERE BELOW $200 AN OUNCE FOR
THE FIRST TIME SINCE 1995. WE SHALL CONTINUE TO SUPPORT THE ASHANTI BOARD AND
MANAGEMENT IN THEIR EFFORTS TO RESTORE THE MARKET'S APPRECIATION OF THE
UNDERLYING VALUE OF THE COMPANY TO THE BENEFIT OF ALL ASHANTI SHAREHOLDERS.
LONMIN'S OPERATIONS IN ZIMBABWE WHICH ACCOUNT FOR ONLY 7 PER CENT OF OUR
TURNOVER PERFORMED WELL UNDER EXTREMELY DIFFICULT CIRCUMSTANCES. MARGINS
RECORDED LAST YEAR WERE ERODED BY A COMBINATION OF THE LOW WORLD GOLD PRICE,
HYPER-INFLATION AND AN OVER VALUED LOCAL CURRENCY, SO THE ACHIEVEMENT OF A
BREAKEVEN IN CASH TERMS WAS A COMMENDABLE PERFORMANCE. IN SPITE OF SPORADIC
SHORTAGES OF BASIC MATERIALS LIKE DIESEL, MANAGEMENT DID EXCEPTIONALLY WELL TO
MAINTAIN MORALE AS WELL AS THE OUTPUT OF GOLD. THE FUTURE VERY MUCH DEPENDS ON
WHAT FURTHER IMPACT THE COMPLEX AND CHALLENGING POLITICAL SITUATION HAS ON THE
ECONOMY, BUT SO FAR, NO PERMANENT DAMAGE TO THE VALUE OF OUR PROPERTIES IN
ZIMBABWE HAS BEEN SUSTAINED.
THE REALISATION OF OUR INVESTMENTS IN NON-CORE BUSINESSES WAS ACCOMPLISHED
THROUGH THREE TRANSACTIONS. DUIKER WAS SOLD FOR A VALUE OF $207 MILLION, THE
PROCEEDS OF WHICH WERE RECEIVED IN MAY THIS YEAR. THE REMAINING BAHAMIAN
HOTELS WHICH WERE NOT SOLD AS PART OF THE PRINCESS DISPOSAL IN 1998, WERE SOLD
FOR $25 MILLION IN APRIL. FE WRIGHT, THE INSURANCE BROKER AND THE ONLY
REMAINING UK ASSET, WAS SOLD FOR $5 MILLION IN JUNE.
FINALLY, I WOULD LIKE TO SAY THAT I FEEL GREATLY PRIVILEGED TO HAVE BEEN GIVEN
THE OPPORTUNITY TO LEAD YOUR COMPANY. THE STRENGTH OF OUR POSITION IS
UNQUESTIONABLE AND I LOOK FORWARD TO MEETING THE CHALLENGES WHICH AWAIT.
EDWARD HASLAM
CHIEF EXECUTIVE
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 SEPTEMBER
1999
2000 RESTATED
NOTE $M $M
TURNOVER 1 951 896
- CONTINUING OPERATIONS 757 458
- DISCONTINUED OPERATIONS 194 438
EBITDA*
- CONTINUING OPERATIONS 2 429 239
- DISCONTINUED OPERATIONS 412 163
DEPRECIATION 17 76
(44) (56)
GROUP OPERATING PROFIT 3 385 183
- CONTINUING OPERATIONS
- DISCONTINUED OPERATIONS 380 135
5 48
SHARE OF ASSOCIATES'
OPERATING (LOSS)/PROFIT (1) 35
TOTAL OPERATING PROFIT 384 218
- CONTINUING OPERATIONS
- DISCONTINUED OPERATIONS 380 135
4 83
PROFIT ON SALE OF FIXED ASSETS 6
GROUP - CONTINUING 10
OPERATIONS
(LOSS)/PROFIT ON SALE OR 6
TERMINATION OF OPERATIONS
GROUP - DISCONTINUED (7) (4)
OPERATIONS
SHARE OF ASSOCIATE
- DISCONTINUED
OPERATIONS 2
PROFIT BEFORE NET INTEREST 387 216
RECEIVABLE/(PAYABLE) AND SIMILAR
ITEMS
NET INTEREST RECEIVABLE/(PAYABLE) 5 11 (28)
AND SIMILAR ITEMS
PROFIT BEFORE TAXATION 4 398 188
- CONTINUING 402 127
OPERATIONS
- DISCONTINUED (4) 61
OPERATIONS
TAXATION 7 (86) (16)
PROFIT AFTER TAXATION 312 172
MINORITY INTERESTS (83) (42)
PROFIT FOR THE YEAR 229 130
- CONTINUING 232 85
OPERATIONS
- DISCONTINUED (3) 45
OPERATIONS
DIVIDENDS 8 (90) (46)
RETAINED PROFIT FOR THE YEAR 139 84
EARNINGS PER SHARE EXCLUDING 9 135.1C 53.7C
EXCEPTIONALS - CONTINUING
OPERATIONS
EARNINGS PER SHARE 9 139.2C 81.5C
DILUTED EARNINGS PER SHARE 9 131.4C 77.0C
DIVIDENDS PER SHARE 8 50.0C 29.1C
* EBITDA IS EARNINGS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION.
THE 1999 FIGURES HAVE BEEN RESTATED FOR DISCONTINUED OPERATIONS WHICH INCLUDE
THE RESULTS OF ASHANTI, BAHAMAS HOTELS, FE WRIGHT AND DUIKER MINING.
CONSOLIDATED BALANCE SHEET
AS AT 30 SEPTEMBER
2000 1999
$M $M
FIXED ASSETS
TANGIBLE ASSETS 710 1,049
INVESTMENTS:
ASSOCIATES 240
OTHER INVESTMENTS 206 11
206 251
916 1,300
CURRENT ASSETS
STOCKS 21 63
DEBTORS 113 111
INVESTMENTS 2 27
CASH AND SHORT-TERM DEPOSITS 439 110
575 311
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR (242) (267)
NET CURRENT ASSETS 333 44
TOTAL ASSETS LESS CURRENT LIABILITIES 1,249 1,344
CREDITORS: AMOUNTS FALLING DUE AFTER MORE
THAN ONE YEAR
CONVERTIBLE DEBT (175)
OTHER (8) (114)
(8) (289)
PROVISIONS FOR LIABILITIES AND CHARGES (11) (67)
1,230 988
CAPITAL AND RESERVES
CALLED UP SHARE CAPITAL 259 262
SHARE PREMIUM ACCOUNT 414 310
REVALUATION RESERVE 18 19
OTHER RESERVES (12) (70)
PROFIT AND LOSS ACCOUNT 352 212
EQUITY INTERESTS 1,031 733
MINORITY EQUITY INTERESTS 199 255
1,230 988
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER
1999
2000 RESTATED
NOTE $M $M
NET CASH INFLOW/(OUTFLOW) 10
FROM OPERATING ACTIVITIES
- CONTINUING ACTIVITIES 354 153
DISCONTINUED ACTIVITIES (8) 87
346 240
DIVIDENDS RECEIVED FROM 4
ASSOCIATE
INTEREST - RECEIVED 10 8
- PAID (25) (40)
DIVIDENDS PAID TO MINORITIES (40) (23)
RETURNS ON INVESTMENTS AND (55) (55)
SERVICING OF FINANCE
TAXATION (21) (20)
CAPITAL EXPENDITURE AND FINANCIAL (117) (120)
INVESTMENT
ACQUISITIONS AND DISPOSALS 212 (45)
EQUITY DIVIDENDS PAID (71) (38)
NET CASH INFLOW/(OUTFLOW) BEFORE 294 (34)
USE OF LIQUID RESOURCES
AND FINANCING
- CONTINUING ACTIVITIES 338 4
- DISCONTINUED ACTIVITIES (44) (38)
MANAGEMENT OF LIQUID RESOURCES (335)
FINANCING
NEW LONG TERM LOANS 102 3
NEW SHORT TERM LOANS 10
REPAYMENT OF LONG TERM LOANS (64) (49)
REPAYMENT OF SHORT TERM LOANS (5) (31)
33 (67)
ISSUE OF ORDINARY SHARE CAPITAL 8 3
NET CASH INFLOW/(OUTFLOW) FROM FINANCING 41 (64)
INCREASE/(DECREASE) IN CASH IN THE YEAR - (98)
- CONTINUING ACTIVITIES 7 (51)
- DISCONTINUED ACTIVITIES (7) (47)
STATEMENT OF TOTAL CONSOLIDATED RECOGNISED
GAINS AND LOSSES
FOR THE YEAR ENDED 30 SEPTEMBER
2000 1999
$M $M
PROFIT/(LOSS) FOR THE YEAR - GROUP 230 104
- ASSOCIATES (1) 26
DILUTION OF GROUP'S INTEREST IN ASHANTI (6)
GROUP SHARE OF EQUITY ISSUED BY ASHANTI 15
TOTAL RECOGNISED GAINS RELATING TO THE YEAR 229 139
RECONCILIATION OF MOVEMENT IN EQUITY
INTERESTS
FOR THE YEAR ENDED 30 SEPTEMBER
2000 1999
$M $M
TOTAL RECOGNISED GAINS RELATING TO THE YEAR 229 139
DIVIDENDS (90) (46)
RETAINED PROFIT FOR THE YEAR 139 93
NEGATIVE GOODWILL REALISED ON SALE OF
SUBSIDIARIES (13)
SHARES ISSUED ON CONVERSION OF BONDS 163
SHARES ISSUED ON EXERCISE OF SHARE OPTIONS 8 3
OTHER ITEMS 1 (4)
NET INCREASE IN EQUITY INTERESTS IN THE YEAR 298 92
EQUITY INTERESTS AT 1 OCTOBER 733 641
EQUITY INTERESTS AT 30 SEPTEMBER 1,031 733
CONSOLIDATED HISTORICAL COST PROFITS
FOR THE YEAR ENDED 30 SEPTEMBER
2000 1999
$M $M
REPORTED PROFIT BEFORE TAXATION 398 188
DIFFERENCE BETWEEN A HISTORICAL COST
DEPRECIATION CHARGE AND THE ACTUAL DEPRECIATION
CHARGE CALCULATED ON THE REVALUED AMOUNT 2 2
HISTORICAL COST PROFIT BEFORE TAXATION 400 190
HISTORICAL COST RETAINED PROFIT FOR THE YEAR 141 86
1 TURNOVER
TURNOVER IS ANALYSED BY ACTIVITY AND
GEOGRAPHICAL AREA BELOW:
1999
2000 RESTATED
$M $M
PLATINUM 703 404
GOLD 54 54
CONTINUING OPERATIONS 757 458
DISCONTINUED OPERATIONS 194 438
951 896
SOUTH AFRICA 703 404
ZIMBABWE 54 54
CONTINUING OPERATIONS 757 458
DISCONTINUED OPERATIONS 194 438
951 896
2 EBITDA
EARNINGS BEFORE INTEREST, TAX, DEPRECIATION
AND AMORTISATION (EBITDA) IS ANALYSED BY
ACTIVITY AND GEOGRAPHICAL AREA BELOW:
1999
2000 RESTATED
$M $M
PLATINUM 425 154
GOLD 17
OTHER (2) 3
CENTRAL COSTS (11) (11)
CONTINUING OPERATIONS 412 163
DISCONTINUED OPERATIONS 17 76
429 239
SOUTH AFRICA 412 147
ZIMBABWE 17
EUROPE 11 10
CENTRAL COSTS (11) (11)
CONTINUING OPERATIONS 412 163
DISCONTINUED OPERATIONS 17 76
429 239
3 GROUP OPERATING PROFIT
GROUP OPERATING PROFIT IS ANALYSED BY ACTIVITY
AND GEOGRAPHICAL AREA BELOW:
1999
2000 RESTATED
$M $M
PLATINUM 397 129
GOLD (4) 14
OTHER (2) 3
CENTRAL COSTS (11) (11)
CONTINUING OPERATIONS 380 135
DISCONTINUED OPERATIONS 5 48
385 183
SOUTH AFRICA 384 122
ZIMBABWE (4) 14
EUROPE 11 10
CENTRAL COSTS (11) (11)
CONTINUING OPERATIONS 380 135
DISCONTINUED OPERATIONS 5 48
385 183
4 PROFIT BEFORE TAXATION
PROFIT BEFORE TAXATION IS ANALYSED BY
ACTIVITY AND GEOGRAPHICAL AREA BELOW:
1999
2000 RESTATED
$M $M
PLATINUM 394 125
GOLD (5) 13
OTHER (2) 3
CENTRAL COSTS (11) (11)
CENTRAL INTEREST AND SIMILAR ITEMS 16 (3)
CONTINUING OPERATIONS 392 127
DISCONTINUED OPERATIONS 3 63
395 190
EXCEPTIONAL ITEMS 3 (2)
PROFIT BEFORE TAXATION 398 188
SOUTH AFRICA 381 118
ZIMBABWE (5) 13
EUROPE 11 10
CENTRAL COSTS (11) (11)
CENTRAL INTEREST AND SIMILAR ITEMS 16 (3)
CONTINUING OPERATIONS 392 127
DISCONTINUED OPERATIONS 3 63
395 190
EXCEPTIONAL ITEMS 3 (2)
PROFIT BEFORE TAXATION 398 188
5 NET INTEREST RECEIVABLE/(PAYABLE)
AND SIMILAR ITEMS
NET INTEREST RECEIVABLE/(PAYABLE) AND SIMILAR
ITEMS IS ANALYSED AS FOLLOWS:
2000 1999
$M $M
ON BANK LOANS AND OVERDRAFTS WHOLLY REPAYABLE
WITHIN FIVE YEARS (21) (27)
ON OTHER LOANS (6) (11)
ON FINANCE LEASES (1)
DISCOUNTING ON PROVISIONS (1) (2)
(29) (40)
SHARE OF INTEREST OF ASSOCIATES (6)
(29) (46)
INTEREST RECEIVABLE 15 8
EXCHANGE DIFFERENCES ON NET DEBT 25 10
11 (28)
6 EXCEPTIONAL ITEMS
1999
2000 RESTATED
$M $M
PROFIT ON SALE OF FIXED ASSETS
CONTINUING OPERATIONS 10
SALE OR TERMINATION OF OPERATIONS
- WRITE DOWN OF GOLD AND ANTHRACITE OPERATIONS (4)
- LOSS ON THE SALE OF BAHAMAS HOTELS (9)
- PROFIT ON THE SALE OF DUIKER MINING 11
- OTHER LOSSES (9)
LOSS ON SALE OR TERMINATION OF OPERATIONS (7) (4)
CONTINUING OPERATIONS
DISCONTINUED OPERATIONS (7) (4)
SHARE OF EXCEPTIONAL PROFIT OF ASSOCIATE 2
NET EXCEPTIONAL ITEMS BEFORE TAXATION AND
MINORITY INTERESTS 3 (2)
CONTINUING OPERATIONS 10
DISCONTINUED OPERATIONS (7) (2)
TAXATION (1) 1
MINORITY INTERESTS 1
NET EXCEPTIONAL ITEMS 2
CONTINUING OPERATIONS 9
DISCONTINUED OPERATIONS (7)
7 TAX ON PROFIT ON ORDINARY ACTIVITIES
2000 1999
$M $M
UNITED KINGDOM:
CORPORATION TAX AT 30% (1999 - 30.5%) 8
ADVANCE CORPORATION TAX (5) (7)
RELIEF FOR OVERSEAS TAX (1)
(5) -
OVERSEAS TAX FOR THE YEAR 90 22
PRIOR YEAR ADJUSTMENTS (5)
TAX ON PROFIT ON ORDINARY ACTIVITIES BEFORE
EXCEPTIONAL ITEMS 85 17
TAX ON EXCEPTIONAL ITEMS 1 (1)
86 16
THE CHARGE FOR TAX HAS BEEN REDUCED BY $72M (1999 - $41M) IN RESPECT OF
ACCELERATED TAX ALLOWANCES IN EXCESS OF DEPRECIATION AND OTHER TIMING
DIFFERENCES.
8 DIVIDENDS
2000 1999
$M $M
INTERIM 9.3P/14.0C (1999 - 7.5P/12.1C) PER SHARE 25 19
FINAL 25.7P/36.0C (1999 - 10.4P/17.0C) PER SHARE 65 27
90 46
AT THE YEAR END, THE GROUP HAD SURPLUS ACT OF $105M CARRIED FORWARD AND
AVAILABLE FOR SET-OFF AGAINST FUTURE UNITED KINGDOM CORPORATION TAX
LIABILITIES. THE NOTIONAL "SHADOW ACT" WHICH MUST BE SET-OFF PRIOR TO
UTILISATION OF SURPLUS ACT AMOUNTS TO $41M.
9 EARNINGS PER SHARE
EARNINGS PER SHARE HAS BEEN CALCULATED ON THE PROFIT ATTRIBUTABLE TO
SHAREHOLDERS AMOUNTING TO $229M (1999 - $130M) USING A WEIGHTED AVERAGE OF
164,527,428 ORDINARY SHARES (1999 - 159,325,714 ORDINARY SHARES).
EARNINGS PER SHARE EXCLUDING EXCEPTIONAL ITEMS FROM CONTINUING OPERATIONS HAS
BEEN CALCULATED ON THE PRE-EXCEPTIONAL PROFIT ATTRIBUTABLE TO SHAREHOLDERS
AMOUNTING TO $223M (1999 - $85M) USING THE SAME WEIGHTED AVERAGE NUMBER OF
ORDINARY SHARES AS ABOVE.
THE PRE-EXCEPTIONAL ATTRIBUTABLE PROFIT FROM CONTINUING OPERATIONS IS
CALCULATED AS FOLLOWS:
2000 1999
$M $M
PROFIT FOR THE YEAR 229 130
DISCONTINUED OPERATIONS LOSS/(PROFIT) FOR THE YEAR 3 (45)
PROFIT FOR THE YEAR - CONTINUING OPERATIONS 232 (85)
PROFIT ON SALE OF FIXED ASSETS - CONTINUING (10)
OPERATIONS
TAX ON PROFIT ON SALE OF FIXED ASSETS - CONTINUING 1
OPERATIONS
PRE-EXCEPTIONAL PROFIT FOR THE YEAR - CONTINUING
OPERATIONS 223 85
DILUTED EARNINGS PER SHARE IS BASED ON THE WEIGHTED AVERAGE NUMBER OF ORDINARY
SHARES IN ISSUE ADJUSTED BY THE DILUTIVE OUTSTANDING SHARE OPTIONS AND THE
CONVERTIBLE BONDS FOR THAT PART OF THE YEAR PRIOR TO THEIR CONVERSION IN JULY
2000. THESE ADJUSTMENTS GIVE RISE TO AN INCREASE IN THE WEIGHTED AVERAGE
NUMBER OF ORDINARY SHARES IN ISSUE OF 14,506,651 (1999 - 18,405,976) AND AN
INCREASE IN THE ATTRIBUTABLE PROFIT OF $6M (1999 - $7M) ARISING FROM THE POST
TAX INTEREST SAVING WHICH WOULD HAVE ARISEN HAD THE BONDS BEEN CONVERTED AT THE
START OF THE YEAR.
10 NET CASH FLOW FROM OPERATING ACTIVITIES
1999
2000 RESTATED
$M $M
GROUP OPERATING PROFIT FROM CONTINUING OPERATIONS 380 135
DEPRECIATION CHARGE 32 28
DECREASE/(INCREASE) IN STOCK 5 (5)
(INCREASE)/DECREASE IN DEBTORS (59) 1
INCREASE/(DECREASE) IN CREDITORS 12 (1)
DECREASE IN PROVISIONS (7)
OTHER ITEMS (9) (5)
NET CASH INFLOW FROM CONTINUING OPERATIONS 354 153
NET CASH (OUTFLOW)/INFLOW IN RESPECT OF
DISCONTINUED OPERATIONS (8) 87
NET CASH INFLOW FROM OPERATING ACTIVITIES 346 240
11 EXCHANGE RATES
THE PRINCIPAL US DOLLAR EXCHANGE RATES USED ARE AS FOLLOWS:
2000 1999
AVERAGE EXCHANGE RATES:
STERLING 0.64 0.61
SA RAND 6.60 6.02
ZIMBABWE DOLLAR 40.44 37.92
CLOSING EXCHANGE RATES:
STERLING 0.69 0.61
SA RAND 7.23 6.04
ZIMBABWE DOLLAR 52.47 38.20
12 STATUTORY DISCLOSURE
THE FINANCIAL INFORMATION SET OUT ABOVE IS TAKEN FROM BUT DOES NOT CONSTITUTE
THE COMPANY'S STATUTORY ACCOUNTS FOR THE YEARS ENDED 30 SEPTEMBER 2000 OR 1999.
STATUTORY ACCOUNTS FOR 1999 HAVE BEEN DELIVERED, AND FOR 2000 WILL BE
DELIVERED, TO THE REGISTRAR OF COMPANIES. THE AUDITORS HAVE MADE UNQUALIFIED
REPORTS ON THOSE ACCOUNTS AND SUCH REPORTS DID NOT CONTAIN A STATEMENT UNDER
SECTION 237(2) OR (3) OF THE COMPANIES ACT 1985.
COPIES OF THE 2000 LONMIN ACCOUNTS WILL BE POSTED TO SHAREHOLDERS AND WILL BE
AVAILABLE AT THE COMPANY'S REGISTERED OFFICE IN MID DECEMBER 2000.
13 ANNUAL GENERAL MEETING
THE ANNUAL GENERAL MEETING WILL BE HELD ON THURSDAY 15 FEBRUARY 2001.
ISSUED BY LONMIN PLC
4 GROSVENOR PLACE, LONDON SW1X 7YL
TEL 020 7201 6000 FAX 020 720/1 6100
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