Wrap Text
Lonmin Plc - Final Results 16 November 2005
Lonmin Plc
(Incorporated in England)
(Registered in the Republic of South Africa under registration number
1969/000015/10)
Share code: LON
Issuer code: LOLMI
ISIN: GB0031192486
News Release
Final Results 16 November 2005
Growth and Operational Excellence
EBIT from continuing operations up 16.5% to US$353 million
Underlying earnings per share from continuing operations excluding acquisitions
up
29% to 124.9 cents per share
Total production of 916,420 ounces of Platinum and 1,704,249 ounces of PGMs
Six Sigma programme delivers R206 million of net benefit
Limpopo integration progresses well - achieves positive EBITDA in September
Dividend maintained at 72.0 cents per share (Final 42.0 cents per share)
Financial highlights -
Continuing Operations 2005 2004
Year to 30 September
Turnover $1,128 $1,030
m m
EBITDA (i) $416m $357m
EBIT (ii) $353m $303m
Profit before taxation $323m $290m
Earnings per share 115.0c 87.0c
Underlying earnings per 116.4c 96.9c
share (iii)
Underlying earnings per 124.9c 96.9c
share excluding acquisitions
Dividend per share (iv) 72.0c 72.0c
Trading cash flow per share 191.2c 229.2c
Free cash flow per share 39.5c 70.7c
Equity shareholders" funds $812m $744m
Net borrowings $588m $275m
Interest cover (v) 13.9x 30.4x
Gearing (vi) 41% 27%
NOTES ON HIGHLIGHTS
EBITDA is Group operating profit before interest, tax, depreciation and
amortisation.
EBIT is total operating profit.
Underlying earnings per share are calculated on profit for the year excluding
exchange, the effects of a change in the South African tax rate on the opening
deferred tax balance, reorganisation costs and exceptional items as disclosed in
note 7.
The Board recommends a final dividend of 42.0 cents per share payable on 8
February 2006 to shareholders on the register on 13 January 2006.
Interest cover is calculated as Group operating profit excluding exceptional
items divided by net interest excluding exchange.
Gearing is calculated on the net borrowings attributable to the group divided by
the net borrowings attributable to the Group plus equity shareholders" funds.
Commenting on the results, Brad Mills, Lonmin"s Chief Executive said:
"This year has seen us recover fully from last November"s Smelter accident and
our furnace is now performing at record levels of throughput. With the
acquisition of Southern Platinum, we now have the resource base to deliver
around 1 million ounces of Platinum production in our 2006 financial year. We
are creating a Lonmin culture that is committed to safety and operational
excellence which fully reflects the demographics of South Africa. Our Six Sigma
programme has had a very successful year delivering net benefits well ahead of
our target. We will continue to focus on cost containment in 2006 with the
expansion of our Six Sigma programme, the introduction of Shared Business
Services, our New Era Labour Agreement and the continued de-bottlenecking of our
operations. We expect to make considerable progress with the mechanisation of
our operations in 2006 with around 8% of our ore delivery coming from fully
mechanised stopping panels by year end. "
Enquiries:
Alex Shorland-Ball, Lonmin Plc +44 (0) 20 7201 6060
Anthony Cardew/Rupert Pittman, CardewGroup: +44 (0)20 7930 0777
This press release is available on www.lonmin.com. A live webcast of the final
results" presentation starting at 09.30hrs (London) on 16 November 2005 can be
accessed through the Lonmin website. There will also be a web question facility
available during the presentation. An archived version of the presentation,
together with the presentation slides, will be available on the Lonmin website.
Chief Executive"s Comments
Introduction
This financial year we have made significant progress with our Smelter and have
fully recovered from the explosion last November. After the accident we have
made significant improvements in the way we run the furnace. The Smelter is now
performing well reaching a new record throughput level in Q4 2005. This
performance has allowed us to process more metal than ever before through our
Smelter, Base Metal Refinery and Precious Metal Refinery and to deliver full
year Platinum production of 916,420 ounces.
Our growth profile has been strengthened by the acquisition of Lonmin Platinum
Limpopo which allows us to increase our Platinum production to around 1 million
ounces in financial year 2006.
We are committed to delivering this growth while transforming the culture of
Lonmin to one of operational excellence. We have made considerable progress
this year in executing on our key cost initiatives with our Six Sigma programme
delivering net benefits of R206 million ahead of our target of R70 million.
Safety
We continued to improve our safety performance at our Marikana operations during
the year with the elimination of all work related fatal accidents on surface and
now need to improve further our performance underground. We suffered a total of
six industrial fatalities during the year and the deeply regrettable drowning of
two children in a mine water reclaim pond prior to it being fenced. Our Lost
Time Injury Frequency Rate continued to improve with a 13% reduction versus the
2004 financial year to 18.1 per million man hours worked.
Historically, the Limpopo operations had a very poor safety record due both to
poor operating discipline and the mining method being used. Since taking
control of the mine, we have made great progress in reforming the operating
practices which has materially reduced the number of LTIs and the severity of
the incidents.
As a company we are totally committed to achieving Zero Harm across our
operations and we continue to introduce further safety initiatives to ingrain
the concept of safe production as an integral part of every aspect of the lives
of our employees and contractors. Each shift now has a 15 minute safety break
to discuss safety procedures and risks and we have continued to roll out DuPont
Visible Felt Leadership training to all staff with a target of 100% penetration
by the end of the 2006 financial year.
Production
Our Marikana mining operations produced 11,101,656 tonnes ore milled from
underground operations and 2,444,581 tonnes ore milled from opencast operations.
We have continued to reduce production from our opencast operations to ensure
that our mills are processing the maximum amount possible of high grade, lower
cost underground ore. Looking forward we expect to see this trend continuing
and are forecasting the phase out of our current UG2 opencast operations at
Marikana during 2006.
Following last November"s smelter accident we worked diligently utilising the
advice of both external consultants and our in house Six Sigma team to
understand and determine the optimal way to operate our No. 1 furnace. This
work has resulted in several changes in the way we run the furnace and the
Smelter is now recording record levels of monthly throughput. We achieved an
all time record production in September of 21,114 tonnes smelted through our
No.1 furnace. Total throughput for the financial year was 195,755 tonnes.
The strong performance of the Smelter enabled us to process a record amount of
our PGM ounces through our Smelter, Base Metal Refinery and Precious Metal
Refinery giving us overall production of 916,420 ounces of Platinum and
1,704,249 ounces of PGMs.
The smelter accident last November led to a loss of nine weeks" metal production
in the first half of the year. Although we have made substantial progress in
processing the additional inventory that arose as a result of Smelter shutdown
we finished the year with a higher than normal cash outflow of working capital
of US$43 million. We expect this working capital outflow to reverse itself in
the 2006 financial year.
Costs
In the past, we have reported our costs as a single number of costs in Rand per
PGM ounce sold. This highly aggregated number has not always given a very clear
picture of our overall cost performance. After review, we have changed the way
we will report costs in the future to give a clearer cost picture and allow
easier analysis and comparison of our performance. We will report cost of metal
production from continuing operations net of base metal credits and provide
reconciliation of this cost number to our EBIT result. For the 2005 financial
year our cost of metal production from our Marikana operations net of base metal
credits was R2,243 per PGM ounce versus a like for like cost of R2,186 per PGM
ounce in financial year 2004. This cost figure is not directly comparable with
the figures for costs per PGM ounce sold which we have historically reported.
Six Sigma
Our Six Sigma programme performed extremely well during the year and realised
net benefits of R206 million, well ahead of our target of R70 million for the
last six months. We are targeting an additional benefit from Six Sigma of R300
million for the 2006 financial year.
Shared Business Services
Considerable progress has been made with the implementation of a Shared Business
Services model and the design of the new structure is substantially complete.
We expect to fully implement this programme by the end of March 2006 and we
anticipate substantial annualised cost savings from Shared Business Services of
around R140 million. As we indicated at the time of the interim results the
costs of this reorganisation impact this year"s results and we have recorded a
reorganisation cost for this of US$7 million.
Mechanisation and Automation
We made substantial progress with the implementation of our mechanisation
strategy during the second half of the year. We have taken delivery of our
second set of ULP (Ultra Low Profile) equipment at 1B shaft at our Karee mine.
A third set of equipment will arrive early in 2006, allowing production to ramp
up to a rate of 38,000 tonnes per month. The mining costs at our mechanised
site are now at similar levels to those for our conventional mining at around
R200 per tonne and we expect these to continue to trend lower as we increase
production. We have committed to a further two sets of equipment during the
2006 financial year which will allow us to reach around 8% mechanised production
by the end of the period with a target of 20% mechanisation by the end of 2007.
On 13 October 2005 we signed a partnership agreement with Sandvik Mining &
Construction to cement our relationship in delivering on Lonmin"s commitment to
mechanisation. A key part of this agreement is Sandvik"s commitment to work
with Lonmin to develop jobs in the Rustenburg/Marikana area through developing
Sandvik"s service capability and local manufacturing in the Marikana area.
New Era Labour Agreement
On 21 June 2005, we signed a ground breaking New Era Labour Agreement for a
period of five years from 1 October 2005. This agreement is the first of its
kind in the South African mining industry and limits basic wage increases for
each of the five years to a CPIX increase. In years one and two only we have
agreed to an additional basic wage increase over CPIX of 2%. The agreement,
which is fully supported by the three unions at Marikana, introduces the concept
of gain sharing to our workforce where they will receive bonuses linked to
improvements they make in safety, costs and productivity. This agreement gives
us transparency and certainty of wage costs which make up around 50% of our
current overall cost base until 2010. This agreement gives us an important tool
to allow us to manage our costs going forwards.
Lonmin Platinum Limpopo
The integration of Limpopo continues to progress extremely well and the re-
engineering and mechanisation of the mine is ahead of target. The mine
contributed 11,524 ounces of Platinum and 25,741 ounces of PGMs in the period
since 15 June 2005 when we took control. In September Limpopo achieved positive
EBITDA of US$0.1 million in line with our integration plan. Cost per saleable
PGM ounce in concentrate for Limpopo over the period were R4,102.
We have identified a new opportunity to access a portion of the ore body on the
property through opencast mining and we are currently conducting a feasibility
study on development of an opencast mine at Limpopo. We currently believe this
project could begin production in 2006 and give us an additional around 20,000
Platinum ounces per annum over the next two years in addition to our current
underground plans of around 50,000 to 60,000 ounces of Platinum in financial
year 2006 and around 75,000 ounces in financial year 2007. We have revised our
initial capital expenditure profile for the current Limpopo operation which we
initially estimated to be US$75 million over three years to US$63 million over
the same period.
When we acquired Limpopo we also acquired the offtake contract in relation to
the mine which as part of the terms of the buyout we have agreed will expire in
2006. During Q4 to satisfy the remaining term of the contract we have begun to
substitute concentrate from our Marikana operations for the Limpopo concentrate.
Black Economic Empowerment
We have continued during the year to develop our Social and Labour Plan and make
progress towards gaining our New Order Mining Licence. We are pleased with the
development of our Black Economic Empowerment partner, Incwala whose asset value
has continued to grow during the year benefiting all shareholders including
ourselves. We have extended an invitation to Incwala to participate in Lonmin
Platinum Limpopo and discussions on this are ongoing.
Growth Profile
The addition of the significant resource at Limpopo and continuing evaluation of
the potential of our Marikana operations has allowed us to increase our Platinum
production guidance to around 1 million ounces in 2006 increasing to around 1.3
million ounces in 2010.
In addition to this strong growth profile, future potential additional upside is
provided by our Pandora JV and the opencast opportunity at Limpopo. In line
with our stated strategy to identify and capture quality Platinum resources we
continue to develop our portfolio of exploration projects and will continue to
evaluate other acquisition targets.
This revised production profile and our commitment to mechanisation of new
development where ever possible has resulted in some calendarisation changes in
our capital expenditure profile over the next few years with a slightly
increased capital spend in 2006 and 2007 before the spend declines more rapidly.
For the 2006 financial year we are currently forecasting capital expenditure of
around US$200 million inclusive of both our Marikana and Limpopo operations.
Our capital expenditure for this year was $190 million which included $12
million of spend on our ERP project and $3 million of capital spend at Limpopo.
Markets
The Platinum market has continued to be robust during the year with strong
demand for autocatalysts and from other industrial uses. Supply has remained
constrained given the continued strength of the Rand limiting development of new
sources of Platinum production in South Africa. We expect these dynamics to
continue to drive the market in 2006 and we continue to be very positive about
the outlook for Platinum and Rhodium. We expect both these metals to experience
continued strong growth in demand over the next few years.
Outlook
We now have the resources in place to accelerate production growth to around 1
million ounces in 2006. As a company we remain committed to managing our costs
and have put in place robust initiatives to achieve this outcome. We currently
expect our C1 cost of metal produced net of Base Metal by product credits in
2006 for our Marikana operations to be between R2,300 and 2,400 per PGM ounce.
Our C1 cost guidance for our Limpopo mine for 2006 is R2,900 per saleable PGM
ounce in concentrate.
The Board has recommended a final dividend of 42 cents per share giving a
dividend for the year of 72 cents per share.
At Lonmin we are on a journey to transform ourselves into a modern and efficient
world class mining company utilising the best available operating practices and
capitalising on the diversity of our South African workforce. This year we have
made substantial progress but also experienced some challenges. I would like to
thank all the Lonmin employees, contractors and community members for your
immense contribution to the transformation of Lonmin. Your hard work,
dedication and professionalism during the course of the last year has been
greatly appreciated.
Bradford A Mills
Chief Executive
Financial Review
Introduction
The financial information presented has been prepared on the same basis and
using the same accounting policies as those used to prepare the financial
statements for the year ended 30 September 2004.
Analysis of results
Profit and loss account
A comparison of the 2005 total operating profit with the prior year is set out
below:
$m
Total operating profit for the year ended 30 261
September 2004 140
Increase in sales prices (14)
Decrease in sales volumes 22
Insurance receipts (13)
Smelting incident costs 29
Improved recoveries (22)
Stock measurement (34)
Exchange (16)
Depreciation and amortisation (7)
Reorganisation costs 6
Share of Incwala (8)
Acquisitions (33)
Other cost increases 42
Prior year funding requirement on SUITS
pensions buy-out
Total operating profit for the year ended 30 353
September 2005
The average price realised for the basket of metals sold at 19,979 $/kg was 17%
higher than the prior year. Sales volumes of PGMs decreased from 1,761,171
ounces to 1,692,517 ounces and turnover amounted to $1,128 million. The C1 cost
per PGM ounce sold net of by-product credits on own production from the Marikana
operations amounted to R2,243 for 2005 compared with R2,186 for 2004, an
increase of 2.6%. Further details of unit costs analysis can be found in the
operating statistics table. The improved recoveries detailed above reflected an
improvement in underlying metallurgical recoveries which led to an increase in
the 2004 year-end closing stock valuation. During the second half of the year,
the method of measuring stockpiles and concentrate was refined to value these
based on metal content rather than tonnage. This had the effect of reducing the
2005 year-end closing stock by $22 million. The strength of the South African
rand against the US dollar continued to impact on costs in dollar terms with the
average exchange rate appreciating some 5% on the prior year. The investment in
Platinum Australia was sold on 31 March 2005 for book value with no material
profit impact. The resulting total operating profit which included $6 million
for our 23.56% share of Incwala"s operating profit, amounted to $353 million
(2004 - $261 million). The total operating profit from continuing operations
excluding acquisitions amounted to $363 million, an increase of 20% on the prior
year.
Net interest payable and similar items in 2005 were $30 million compared with
$13 million in 2004. Borrowing levels were higher during the year following the
acquisition of Southern Platinum Corporation resulting in higher interest
payable. This was offset by lower exchange losses due to the majority of
borrowings being held in US dollars and lower levels of amortisation of expenses
on bank facilities.
Profit before tax amounted to $323 million in 2005 compared with $360 million in
2004. Included in 2004 were exceptional profits totalling $70 million relating
to the sale of AngloGold Ashanti ($112 million) and the SUITS pension buy-out
($42 million).
The 2005 tax charge was $118 million compared with $113 million in 2004 and
included $2 million of exchange losses (2004 - $20 million). The corporate tax
rate in South Africa was reduced to 29% during the year and was applicable to
taxable results from 1 October 2004. The change in tax rate resulted in an
adjustment to the opening deferred tax balance at 1 October 2004 to reduce it by
$11 million as disclosed in note 5. The effective tax rate, excluding the
effects of exchange, the adjustment to the opening deferred tax balance and
exceptional items was 39% compared with 33% last year mainly due to higher
dividends declared during the year and the resulting secondary tax charge
thereon.
Profit for the year amounted to $163 million (2004 - $195 million) and earnings
per share were 115.0 cents compared with 137.9 cents in 2004. Underlying
earnings per share, being earnings excluding exchange on tax balances, the
adjustment to the opening deferred tax balance as a result of the South African
corporate tax rate change, reorganisation costs and exceptional items amounted
to 116.4 cents (2004 - 96.9 cents). Underlying earnings per share from
continuing operations excluding acquisitions were 124.9 cents, an increase of
29% on the 2004 amount of 96.9 cents.
On 30 September 2004, the Group increased its effective holding in its
underlying platinum assets from 73% to 82% at a cost of $313 million. In
addition, it invested $90 million in 23.56% of Incwala Resources and advanced
$34 million of loans to HDSA and seed capital investors in Incwala Resources.
The effect of these acquisitions on the 2005 year-end results has been to
improve reported earnings by 4 cents per share.
Balance sheet
Equity interests were $812 million at 30 September 2005 compared with $744
million at 30 September 2004 mainly reflecting the profit for the year of $163
million offset by dividends declared of $42 million and $60 million for the
interim and final dividends respectively.
The Southern Platinum Corporation was acquired on 15 June 2005, with a
compulsory acquisition of the remaining shares on 28 July 2005. The acquisition
was made for a total purchase price of $192 million, including expenses of $5
million, with $55 million of net debt acquired. The excess of the purchase
price over the book value of the assets acquired has been shown within fixed
assets as mineral rights of $46 million and an uplift to the underlying values
of other fixed assets of $36 million. An underlying minority interest of 8.5%
remains at the operational level in Messina Platinum. An amount of $15 million
has also been capitalised within intangible fixed assets. This represented the
amount the Company paid to Impala Platinum Holdings Limited to acquire the
Messina concentrate off-take contract. This is being amortised over 20 years.
The fair value assessment on the 9.11% acquisition of Eastern Platinum Limited
and Western Platinum Limited on 30 September 2004 was finalised during the year.
This resulted in an allocation of $40 million to goodwill which is being
amortised over 20 years.
Net borrowings amounted to $588 million at 30 September 2005 with the main
components being the convertible bonds of $216 million and bank loans of $382
million. Gearing was 41% compared with 27% at 30 September 2004, calculated on
net borrowings attributable to the Group divided by those attributable net
borrowings and the equity interests outstanding at the balance sheet date.
Cash flow
The following table summarises the main components of the cash flow during the
year:
2005 2005 2005 2004
Continu Acquisit Tota Tota
ing ions l l
$m $m $m $m
Net cash inflow from 385 (8) 377 400
operating activities
Interest and finance costs (16) (11) (27) (9)
Tax (79) - (79) (67)
Trading cash flow 290 (19) 271 324
Capital expenditure - (188) (2) (190 (187
purchases ) )
Associate dividends 2 - 2 -
received
Minority dividends (27) - (27) (37)
Free cash flow 77 (21) 56 100
Acquisitions* (10) (207) (217 (390
) )
Disposals - - - (41)
Financial investments 1 - 1 352
Shares issued 6 - 6 6
Equity dividends paid (102) - (102 (102
) )
Cash outflow (28) (228) (256 (75)
)
Opening net borrowings (275) - (275 (197
) )
Exchange (1) (1) (2) (3)
Net borrowings in - (55) (55) -
subsidiaries acquired
Closing net borrowings (304) (284) (588 (275
) )
Trading cash flow per 204.6c (13.4)c 191. 229.
share 2c 2c
Free cash flow per share 54.3c (14.8)c 39.5 70.7
c c
* includes $15 million on intangible fixed asset acquired
Net cash inflow from operating activities was $377 million during 2005, a 6%
decrease on last year"s figure of $400 million. Included was an outflow on
working capital of $43 million compared with an inflow of $39 million last year
due to stock build-up and higher year-end debtors. After interest and finance
costs of $27 million and tax payments of $79 million, trading cash flow amounted
to $271 million in 2005 against $324 million in 2004, with trading cash flow per
share of 191.2 cents in 2005 against 229.2 cents in 2004.
Capital expenditure of $190 million was incurred during the year, an increase on
the prior year in dollar terms, but a 4% reduction in rand terms. Associate and
minority dividends received and paid in 2005 represented dividends from and to
Incwala. Free cash flow amounted to $56 million with free cash flow per share
at 39.5 cents (2004 - 70.7 cents). Acquisitions of $217 million in 2005
represented the purchase of Southern Platinum for $192 million (including
expenses of $5 million), $15 million for the purchase of the concentrate off-
take agreement (shown as intangible fixed asset) and costs relating to the 2004
purchase of a further 9.11% of Eastern Platinum Limited and Western Platinum
Limited. Financial investments included proceeds of $3 million arising from the
sale of Platinum Australia in March 2004. After accounting for shares issued on
the exercise of share options of $6 million and equity dividends paid of $102
million, the cash outflow was $256 million during 2005 and net borrowings
amounted to $588 million at 30 September 2005.
Dividends
The Board recommends a final dividend of 42.0 cents (2004 - 42.0 cents) making
total dividends for the year of 72.0 cents (2004 - 72.0 cents). This represents
a cover of 1.6 times on earnings (2004 - 1.2 times). On an underlying earnings
basis, this represents a cover of 1.6 times compared with 1.3 times in 2004.
Financial risk management
The Group"s functional currency remains the US dollar and the share capital of
the Company is based in US dollars.
The Group"s business is mining and it does not undertake trading activity in
financial instruments.
Interest rate risk
Monetary assets and liabilities are subject to the risk of movements in interest
rates. The borrowings at 30 September 2005 represented $216 million of long-
term borrowings in the form of US dollar 3.75% convertible bonds due 2008,
drawings under long-term bank loans of $205 million and $42 million and $1
million of overdrafts in the UK. In South Africa, a short-term bank loan of $85
million and a long-term bank loan of $49 million were drawn together with an
outstanding finance lease obligation of $1 million. Cash deposits represented
balances of $9 million in the UK and $2 million in South Africa.
A two-year floating rate interest swap was entered into during October 2003 in
respect of the convertible bonds with interest calculated on a six-month LIBOR
in arrears basis. This expired on 30 September 2005 and no further contracts
were entered into. The resulting interest charged on the bonds during 2005 was
$10 million (2004 - $6 million), equivalent to an interest rate of 4.7% (2004 -
2.5%). This compared to interest of $8 million which would have been charged on
the bonds at the fixed rate of 3.75% had the swap not been entered into. All
other borrowings tend to be drawn under floating interest rates.
Liquidity risk
Liquidity risk measures the risk that the Group may not be able to meet its
liabilities as they fall due and, therefore, its ability to continue trading.
The Group"s policy on overall liquidity is to ensure that there are sufficient
committed facilities in place which, when combined with available cash
resources, are sufficient to meet the funding requirements in the forseeable
future. At the 2005 year end, the Group had $1,518 million of committed
facilities in place, of which $597 million were drawn down. A long-term bank
loan of $205 million was included in the amounts drawn down. Although this
facility specifies an expiry date of 28 January 2006 the Company has the option
to extend the maturity of any amount drawn down for up to a further four years.
Foreign currency risk
Foreign currency risk arises when movements in exchange rates, particularly the
US dollar against the South African rand, affect the transactions the Group
enters into, reported profits and net assets. Most of the Group"s operations
are based in South Africa and the majority of the revenue stream is in US
dollars. Most of the cash held in South Africa is in US dollars and is normally
remitted to the UK on a regular basis. Short-term working capital facilities
required in South Africa are drawn primarily in US dollars.
Fluctuations in the Rand to US dollar exchange rate can have a significant
impact on the Group"s results. A strengthening of the Rand against the US
dollar has an adverse effect on profits due to the majority of costs being
denominated in Rand. The approximate effect on the Group"s results of a 10%
movement in the Rand to US dollar 2005 year average exchange rate would be as
follows:
EBIT +/- $40 m
Profit for +/- $23 m
the year
EPS +/- 16.5 c
These sensitivities are based on 2005 prices, costs and volumes and assume all
other variables remain constant. They are estimated calculations only.
Commodity price risk
Commodities trade on worldwide commodities markets and are subject to price
fluctuations. Therefore, the prices obtained are dependent upon the prevailing
market prices. Any change in prices will have a direct effect on the Group"s
trading results. Forward sales are undertaken where the Board determines that
it is in the Group"s interest to secure a proportion of future cash flows. No
such forward sales were undertaken during the year.
The approximate effects on the Group"s results of a 10% movement in the 2005
year average market prices for platinum, palladium and rhodium would be as
follows:
Pt Pd Rh
EBIT +/- $78 m +/- $7 m +/- $19 m
Profit for +/- $45 m +/- $4 m +/- $11 m
the year
EPS +/- 32.0 c +/- 3.0 c +/- 7.9 c
The above sensitivities are based on 2005 volumes and assume all other variables
remain constant. They are estimated calculations only.
International financial reporting standards (IFRS)
Lonmin Plc currently presents its financial information in accordance with UK
Generally Accepted Accounting Principles (UK GAAP). Following a European Union
Regulation issued in 2002, the group will be reporting its results in accordance
with International Financial Reporting Standards (IFRS) as adopted by the
European Union from 1 October 2005. Accordingly, the first financial
information to be reported by the Group in accordance with IFRS will be for the
six months ending 31 March 2006. The requirement to present comparative
information means that a balance sheet as at 30 September 2004 and primary
statements for the six months to 31 March 2005 and the year to 30 September
2005, prepared in accordance with IFRS, will also be required.
The Group intends to present the effects of adopting IFRS on its 2005 interim UK
GAAP figures which were announced on 4 May 2005 and the 2005 annual UK GAAP
figures now presented in this report during the early part of the 2006 calendar
year.
The main differences identified to date between UK GAAP and IFRS which will
affect the Group"s UK GAAP financial statements are:
Post retirement benefits
Under UK GAAP, the Group accounts for defined benefit pension schemes in
accordance with SSAP 24 - Accounting for pension costs. Surpluses or deficits
are spread on a straight-line basis over the expected average remaining service
lives of employees in the scheme. Under IAS 19 - Employee benefits (amended
December 2004), there are several ways in which surpluses or deficits can be
recognised. This will depend on whether the revised IAS 19 will be adopted by
the European Union. The Group may choose to recognise surpluses or deficits
directly in shareholders" funds through the Statement of recognised income and
expense. This treatment is similar to FRS 17 - Retirement benefits.
Share-based payments
Under UK GAAP, the cost of share options is based on the intrinsic value of the
award, being the difference between the exercise price and the grant price.
Hence, options granted to employees at market price or under Inland Revenue
approved SAYE schemes do not generate an expense. Under IFRS 2 - Share-based
payments, the economic cost of all share-based payments granted since 7 November
2002 is to be recognised by reference to the fair value on the grant date using
options pricing models and charged to the income statement over the expected
vesting period.
Proposed dividends
Under UK GAAP, proposed dividends are accrued for as an adjusting post balance
sheet event in the period to which they relate in accordance with SSAP 17 -
Accounting for post balance sheet events. Under IAS 10 - Events after the
balance sheet date, dividends that do not represent a present obligation at the
reporting date are not accrued for in the balance sheet. Instead, they are
recognised in the accounting period in which they are declared.
Financial instruments
The IFRS requirements for financial instruments are included in IAS 32 -
Financial instruments: disclosure and presentation and IAS 39 - Financial
instruments: recognition and measurement. Financial assets and liabilities are
measured at fair value or amortised cost and foreign currency borrowings and
derivative contracts are designated, where applicable, as hedges of specific
assets, liabilities, income and/or expenses. The convertible bonds contain an
embedded derivative in the form of a conversion right, which the Company can
settle in cash. The debt and embedded derivative elements are separated and the
amount relating to the embedded derivative is subject to fair value accounting
under IFRS. This may introduce some material volatility to reported earnings
but will have no impact on cash flow.
Investments in associates
Under UK GAAP, the Group"s share of an associate"s operating profit, interest
and tax are shown within the separate profit and loss account headings. Under
IAS 28 - Investments in Associates, the Group"s share of an associate"s profit
after tax is presented as a single item within the profit and loss account.
Goodwill
Under UK GAAP, goodwill is required to be amortised. Under IFRS 3 - Business
Combinations, amortisation of goodwill is no longer required and instead, annual
impairment reviews must be performed. Due to the finite life of mining assets,
impairment charges relating to goodwill are expected to arise in future
reporting periods. The Group has elected to take advantage of the exemption
allowed in IFRS 1 - First-time Adoption of International Financial Reporting
Standards not to recalculate goodwill for business combinations occurring prior
to the transition date of 1 October 2005. Therefore, the goodwill which arose
on the purchase of a further 9.11% of Eastern Platinum Limited and Western
Platinum Limited on 30 September 2004 remains at its UK GAAP disclosed amount.
Amortisation charged on this goodwill during 2005 will be reversed under IFRS
and will be subject to an impairment test.
Presentation of financial statements
There are a number of reclassifications on the balance sheet to separately show
current and non-current assets and liabilities in accordance with IAS 1 -
Presentation of Financial Statements.
It should be noted that the above summary is not intended to be a complete list
of areas affected by the introduction of IFRS. Further differences may arise as
a result of the Group"s continued detailed assessment and interpretations of
IFRS and any further pronouncements issued by the International Accounting
Standards Board ("IASB").
John Robinson
Chief Financial Officer
15 November 2005
Platinum Operating Statistics - Five Year Review
Sept Sept Sept Sept Sept
2005 2004 2003 2002 2001
Tons milled (1) - (000) 11,10 11,12 11,41 11,26 10,52
Marikan undergr 2 1 8 0 0
a ound
- (000) 214 - - - -
Limpopo undergr
ound
- (000) 2,444 3,283 2,790 - -
Marikan opencas
a t
- total (000) 13,76 14,40 14,20 11,26 10,52
0 4 8 0 0
Tons mined - (000) 11,04 11,07 11,45 12,34 10,11
Marikan undergr 7 0 0 6 1
a ound
- (000) 212 - - - -
Limpopo undergr
ound
- (000) 2,653 2,730 2,880 - -
Marikan opencas
a t
- total (000) 13,91 13,80 14,33 12,34 10,11
2 0 0 6 1
UG2 to Merensky Ratio (%) 74.3 82.4 81.6 78.3 77.1
Noble metals in matte (kg) 53,29 55,03 54,29 46,55 44,16
Marikan 0 1 5 7 3
a
Noble metals in (kg) 801 - - - -
concentrate Limpopo
Yield into matte (g/t) 3.81 3.82 3.83 4.13 4.20
Production (1) Marikana - (oz) 830,9 833,8 932,8 757,4 716,6
refined platinu 11 22 67 51 97
m
- (oz) 360,7 358,7 417,4 350,7 323,7
palladi 53 05 18 92 25
um
- (oz) 93,44 90,01 140,5 113,5 101,8
rhodium 5 2 14 49 81
- total (oz) 1,510 1491, 1,757 1,467 1,357
PGMs ,553 760 ,757 ,525 ,301
Marikana concentrate - (oz) 73,98 82,93 - - -
(2) platinu 5 5
m
- (oz) 38,34 38,34 - - -
palladi 5 1
um
- (oz) 24,49 23,08 - - -
rhodium 1 2
- total (oz) 167,9 184,8 - - -
PGMs 55 08
Limpopo concentrate (2) - (oz) 11,52 - - - -
platinu 4
m
- (oz) 9,043 - - - -
palladi
um
- (oz) 1,320 - - - -
rhodium
- total (oz) 25,74 - - - -
PGMs 1
Lonmin Platinum - (oz) 916,4 916,7 853,8 757,4 716,6
platinu 20 57 67 51 97
m
- (oz) 408,1 397,0 381,0 350,7 323,7
palladi 41 46 18 92 25
um
- (oz) 119,2 113,0 130,1 113,5 101,8
rhodium 56 94 14 49 81
- total (oz) 1,704 1,676 1,631 1,467 1,357
PGMs ,249 ,568 ,957 ,525 ,301
Capital expenditure (R 1,180 1,230 1,293 1,558 936.5
millio .0 .1 .6 .2
n)
($ 190.3 186.8 161.5 150.3 113.5
millio
n)
Sales (1) Lonmin Platinum - (oz) 912,8 941,1 903,0 757,9 707,3
platinu 44 46 77 58 79
m
- (oz) 402,4 405,3 405,0 349,2 315,6
palladi 25 29 73 43 97
um
- (oz) 117,9 126,7 131,7 109,1 95,13
rhodium 44 23 52 94 8
- total (oz) 1,692 1,761 1,728 1,415 1,307
PGMs ,517 ,171 ,387 ,112 ,495
Average price - (R) 5,366 5,356 5,053 5,357 4,411
received per ounce platinu
m
($) 856 816 645 501 544
- (R) 1,184 1,485 1,698 3,759 5,404
palladi
um
($) 189 227 212 351 670
- (R) 10,49 4,876 4,201 9,123 13,81
rhodium 4 3
($) 1,661 745 529 850 1,703
Basket price of PGMs and ($/kg) 19,97 17,07 14,61 13,66 18,65
base metals 9 2 8 2 2
Platinum Operating Statistics - Five Year Review
Cash Costs - Underground (R) 1,838 1,698 N/C N/C N/C
- Opencast (R) 2,149 1,686 N/C N/C N/C
- Mining - weighted (R) 1,889 1,696 N/C N/C N/C
average cost
- Smelting & refining (R) 261 242 N/C N/C N/C
- Shared Business (R) 347 316 N/C N/C N/C
Services
- Movement in physical (R) (11) 165 N/C N/C N/C
stock
Cost per PGM ounce sold before By (R) 2,486 2,419 N/C N/C N/C
Products Credits
- Base metal credits (R) (243) (233) N/C N/C N/C
C1 - Cost per PGM ounce sold
net of By Product (R) 2,243 2,186 N/C N/C N/C
Credits - Marikana
- Improved recoveries (R) (118) (29) N/C N/C N/C
- Smelter Repair (R) 47 - N/C N/C N/C
- Accounting change for
stock valuation (R) 91 - N/C N/C N/C
Other EBIT items: - (R) 253 232 N/C N/C N/C
Amortisation
- Insurance proceeds (R) (83) - N/C N/C N/C
- Restructuring (R) 23 - N/C N/C N/C
- Other off mine
exploration (R) 12 26 N/C N/C N/C
/donations
C2 - Costs per PGM ounce - (R) 2,468 2,415 N/C N/C N/C
sold own production Ma
ri
ka
na
Cash cost per saleable PGM
ounce in concentrate - (R) 4,102 - - - -
Li
mp
op
o
($) 632 - - - -
Cash cost per refined ounce of (R) N/C N/C 1,97 1,86 1,66
PGM sold (incl royalties) 4 3 0
($) N/C N/C 251 176 205
Cash cost per refined ounce of (R) N/C N/C 1,96 1,84 1,65
PGM sold (ex royalties) 9 7 5
($) N/C N/C 250 174 205
Cash cost per refined - (R) N/C N/C 2,02 1,77 N/C
ounce of un 2 6
de
rg
ro
un
d
PGM produced (ex ($) N/C N/C 257 168 N/C
royalties)
- (R) N/C N/C 1,80 2,72 N/C
op 1 6
en
ca
st
($) N/C N/C 229 257 N/C
- (R) N/C N/C 1,96 1,78 1,59
to 6 0 4
ta
l
($) N/C N/C 254 168 197
Average exchange - (GBP 0.54 0.56 0.62 0.68 0.69
rates St /$)
er
li
ng
- (R/$ 6.28 6.60 7.90 10.7 8.00
S ) 0
A
Ra
nd
Closing exchange - (GBP 0.57 0.55 0.60 0.64 0.69
rates St /$)
er
li
ng
- (R/$ 6.36 6.48 6.97 10.5 8.77
S ) 4
A
Ra
nd
Notes:
(1) Excluding slag.
(2) Produced for sale as concentrate or toll refined.
Consolidated profit and loss account
For the year ended 30 September
2005 2004 2004 2004
Total Before Except Total
exceptio ional
nal items
items
No $m $m $m $m
te
Turnover 2 1,128 1,030 - 1,030
- continuing 1,122 1,030 - 1,030
operations
- acquisitions (iv) 6 - - -
EBITDA (i) 2 416 357 (42) 315
- continuing 424 357 - 357
operations
- acquisitions (8) - - -
- discontinued - - (42) (42)
operations
Depreciation and (69) (53) - (53)
amortisation
Group operating 347 304 (42) 262
profit/(loss)
- continuing 357 304 - 304
operations
- acquisitions (10) - - -
- discontinued - - (42) (42)
operations
Share of 6 (1) - (1)
associates" operating
profit/(loss)
Total operating 2 353 303 (42) 261
profit/(loss) 4 - - 112 112
Profit on sale of
fixed assets
Profit before net 353 303 70 373
interest payable and 3 (27) (13) - (13)
similar items
Net interest
payable and similar
items - Group
- Associates 3 (3) - - -
Profit before 2 323 290 70 360
taxation 5 (118) (116) 3 (113)
Taxation (ii)
Profit after 205 174 73 247
taxation (42) (51) (1) (52)
Equity minority
interest
Profit for the year 163 123 72 195
- continuing 180 123 2 125
operations
- acquisitions (17) - - -
- discontinued - - 70 70
operations
Dividends 6 (102) (102) - (102)
Retained profit for 61 21 72 93
the year
Underlying earnings 7 116.4c 96.9c - 96.9c
- total
per share (v) - 124.9c 96.9c - 96.9c
continuing operations
- acquisitions (8.5)c - - -
Earnings per share 7 115.0c 87.0c 50.9c 137.9c
- total
- continuing 127.0c 87.0c 1.4c 88.4c
operations
- acquisitions (12.0)c - - -
- discontinued - - 49.5c 49.5c
operations
Diluted earnings 7 113.4c 85.9c 45.9c 131.8c
per share
Dividends per share 6 72.0c 72.0c - 72.0c
Financial ratios
Tax rate (iii) 39% 33% - 33%
Net debt to EBITDA 1.4 0.8 - 0.9
times times times
Notes:
(i) EBITDA is Group operating profit before interest, tax, depreciation and
amortisation.
(ii) The taxation charge includes exchange losses of $2 million (September 2004
- $20 million) as disclosed in note 5.
(iii) The tax rate has been calculated excluding exchange, the effect of a
change in the South African tax rate on the opening deferred tax balance and
exceptional items as disclosed in note 5.
(iv) Acquisitions represented Southern Platinum Corporation.
(v) Underlying earnings per share are calculated on profit for the year
excluding exchange, the effect of a change in the South African tax rate on the
opening deferred tax balance, reorganisation costs and exceptional items as
disclosed in note 7.
Consolidated balance sheet
As at 30 September
2005 2004
$m $m
Fixed assets
Intangible assets 53 -
Tangible assets 1,719 1,370
Investments: 132 133
Associate
Other investments
91 90
41 43
Total fixed assets 1,904 1,503
Current assets
Stocks 110 81
Debtors 152 124
Investments 7 5
Cash and short-term deposits 11 20
Total current assets 280 230
Creditors: amounts falling due within (308) (217)
one year
Current loans and overdrafts (86) (23)
Other (222) (194)
Net current (liabilities)/assets (28) 13
Total assets less current liabilities 1,876 1,516
Creditors: amounts falling due after (510) (268)
more than one year
Convertible debt (213) (212)
Other loans (296) (56)
Other (1) -
Provisions for liabilities and charges (388) (353)
978 895
Capital and reserves
Called up share capital 142 142
Share premium account 12 6
Revaluation reserve 16 16
Capital redemption reserve 88 88
Profit and loss account 554 492
Equity shareholders" funds 812 744
Equity minority interests 166 151
978 895
Consolidated cash flow statement
For the year ended 30 September
2005 2004
$m $m
Net cash inflow from operating activities 377 359
Dividend received from associate 2 -
Returns on investment and servicing of (54) (46)
finance
Interest - received 2 8
- paid (23) (13)
Financing expenses (6) (4)
Dividends paid to minority (27) (37)
Taxation (79) (67)
Capital expenditure and financial (204) 165
investment
(197) (390)
Acquisitions and disposals
(102) (102)
Equity dividends paid
Net cash outflow before financing (257) (81)
Financing 269 60
New long-term loans 204 56
New short-term loans 85 -
Repayment of long-term loans (26) -
Repayment of short-term loans - (2)
Issue of ordinary share capital 6 6
Increase/(decrease) in cash in the year 12 (21)
Net cash inflow from operating activities
2005 2004
$m $m
Group operating profit before exceptional items 347 304
Depreciation and amortisation 69 53
(Increase)/decrease in stock (26) 19
(Increase)/decrease in debtors (22) 26
Increase/(decrease) in creditors 5 (6)
Increase in provisions 3 -
Other 1 4
Net cash inflow from operating activities - 377 400
continuing operations and acquisitions - (41)
Net cash outflow from operating activities -
discontinued operations
Net cash inflow from operating activities 377 359
Statement of total consolidated recognised gains and losses
For the year ended 30 September
2005 2004
$m $m
Profit/(loss) for the year - Group 160 196
- Associate 3 (1)
Total consolidated recognised gains relating to 163 195
the year
Consolidated historical cost profits and losses
For the year ended 30 September
2005 2004
$m $m
Reported profit before taxation 323 360
Difference between an historical cost
depreciation charge and the 2 2
actual depreciation charge calculated on
the revalued amount
Historical cost profit before taxation 325 362
Historical cost retained profit for the year 63 95
Reconciliation of movement in equity shareholders" funds
For the year ended 30 September
2005 2004
$m $m
Total consolidated recognised gains relating to the 163 195
year (102) (102)
Dividends
Retained profit for the year 61 93
Shares purchased by ESOP (1) (2)
Shares disposed of by ESOP 1 -
Amortisation of share-based payments 1 2
Shares issued on the exercise of share options 6 6
Net increase in equity shareholders" funds in the 68 99
year 744 645
Equity shareholders" funds at 1 October
Equity shareholders" funds at 30 September 812 744
Basis of preparation
The year end accounts have been prepared on the same basis and using the same
accounting policies as those used to prepare the financial statements of the
Lonmin Group for the year ended 30 September 2004.
Segmental analysis
By business origin:
2005
Total Profit
operatin before Net
Turnover EBITDA g tax assets
$m $m profit $m $m
$m
Platinum 1,128 450 387 370 1,491
- 1,122 458 397 384 1,306
continuing
operations
- 6 (8) (10) (14) 185
acquisitions
Exploration - (11) (11) (11) -
Corporate - (23) (23) (36) (513)
Total 1,128 416 353 323 978
- 1,122 424 363 341 793
continuing
operations
- 6 (8) (10) (18) 185
acquisitions
South Africa 1,128 457 394 377 1,488
Other - (18) (18) (18) 3
Corporate - (23) (23) (36) (513)
Total 1,128 416 353 323 978
- 1,122 424 363 341 793
continuing
operations
- 6 (8) (10) (18) 185
acquisitions
2004
Total Profit
operatin before Net
Turnover EBITDA g tax assets
$m $m profit $m $m
$m
Platinum 1,030 384 332 324 1,217
Exploration - (7) (8) (8) 3
Other - (2) (2) (2) -
Corporate - (18) (19) (24) (325)
Continuing 1,030 357 303 290 895
operations - (42) (42) 70 -
Discontinued
operations
Total 1,030 315 261 360 895
South Africa 1,030 387 335 327 1,215
Other - (12) (13) (13) 5
Corporate - (18) (19) (24) (325)
Continuing 1,030 357 303 290 895
operations - (42) (42) 70 -
Discontinued
operations
Total 1,030 315 261 360 895
The segmental analysis of assets is now based on net assets rather than net
operating assets.
Net Interest Payable & Similar Items
2005 2004
$m $m
Interest payable:
On bank loans and overdrafts 24 12
Bank fees 2 6
Discounting on provisions 2 -
28 18
Capitalisation of interest (1) -
Interest receivable on cash at bank and in (2) (4)
hand - (4)
Interest receivable on loans to Ashanti 2 3
Exchange differences on net borrowings
Net interest payable and similar items - 27 13
Group
- Associate 3 -
30 13
Exceptional Items
2005 2004
$m $m
Operating items:
- Funding requirement on the buy-out of the SUITS - (42)
pension fund
Profit on sale of fixed assets:
- Sale of investment in AngloGold Ashanti - 112
Exceptional items before taxation and minority - 70
interest - 3
Taxation - (1)
Minority interest
Net exceptional profit - 72
Continuing operations - 2
Discontinued operations - 70
The exceptional tax credit in 2004 represented the closing US dollar value of
South African tax over-provided in 2003 on the disposal of the Brakspruit
mineral rights.
Taxation
2005 2004
$m $m
United Kingdom:
Corporation tax at 30% (2004- 30%) 53 17
Double tax relief (53) (17)
- -
Overseas:
Current taxation at 29% (2004 - 30%) 95 60
Excluding tax on local currency exchange profits 79 54
Tax on local currency exchange profits (3) (2)
Tax on dividends remitted 19 7
Exchange on current taxation - 1
Deferred taxation 24 59
Origination and reversal of timing differences 30 39
Change in South African corporate tax rate to 29% (11) -
(2004 - 30%) 5 20
Exchange on deferred taxation
Prior year items (current taxation) (1) (6)
Exceptional - (4)
Other (1) (3)
Exchange on prior year items - 1
Tax charge 118 113
Tax charge excluding exceptional items, tax rate 127 97
adjustment and exchange
Effective tax rate excluding exceptional items, 39% 33%
tax rate adjustment and exchange
A reconciliation of the standard tax charge to the current tax charge was as
follows:
2005 2004
$m $m
Tax charge at standard tax rate of 29% (2004 - 94 108
30%) 19 7
Overseas taxes on dividends remitted by - (34)
subsidiary companies (15) (20)
Non-taxable chargeable gains (3) (1)
Other timing differences
Effect of exchange adjustments
95 60
Prior year items (1) (6)
Current tax charge 94 54
Dividend
2005 2004
$m $m
Interim 30.0c (2004 - 30.0c) per share 42 42
Final 42.0c (2004 - 42.0c) per share 60 60
Total dividends 72.0c (2004 - 72.0c) per share 102 102
Until 31 March 1999, advanced corporation tax (ACT) was paid on dividends at the
rate of 25% of the net dividend. Subject to certain restrictions, this was
recoverable by offsetting it against corporation tax liabilities. When this
offset was not available surplus ACT was generated.
At the year end, the Group had surplus ACT of $103 million (2004 - $103 million)
carried forward and available, subject to certain restrictions, for set-off
against future United Kingdom corporation tax liabilities. The notional "Shadow
ACT", being the ACT which would have been payable if the system had not been
abolished and which must be set-off prior to utilisation of surplus ACT,
amounted to $189 million (2004 - $167 million).
Earnings per Share
Earnings per share have been calculated on the profit for the year amounting to
$163 million (2004 - $195 million) using a weighted average number of
141,727,124 ordinary shares (2004 - 141,384,398 ordinary shares).
Diluted earnings per share are based on the weighted average number of ordinary
shares in issue adjusted by dilutive outstanding share options and shares
issuable on conversion of the convertible bonds during the year as follows:
2005 2004
Profit Per Profit Per
for Number share for Number share
the of amount the of amount
year shares cents year shares cents
$m $m
Basic EPS 163 141,727, 115.0 195 141,384, 137.9
124 398
- continuing 180 - 127.0 125 - 88.4
operations
- acquisitions (17) - (12.0) - - -
- discontinued - - - 70 - 49.5
operations
Share option schemes - 290,375 (0.2) - 468,002 (0.4)
Convertible bonds 10 10,576,9 (1.4) 6 10,576,9 (5.7)
93 93
Diluted EPS 173 152,594, 113.4 201 152,429, 131.8
492 393
Underlying earnings per share have been presented as the Directors consider it
to give a fairer reflection of the underlying results of the business.
Underlying earnings are based on the profit for the year adjusted to exclude
reorganisation costs, exceptional items, the effect of a change in the South
African tax rate on the opening deferred tax balance and exchange on tax
balances as follows:
2005 2004
Profit Per Profit Per
for Number share for Number share
the of amount the of amount
year shares cents year shares cents
$m $m
Basic EPS 163 141,727, 115.0 195 141,384, 137.9
124 398
- continuing 180 - 127.0 125 - 88.4
operations
- acquisitions (17) - (12.0) - - -
- discontinued - - - 70 - 49.5
operations
Reorganisation costs 12 - 8.4 - - -
- continuing 7 - 4.9 - - -
operations
- acquisitions 5 - 3.5 - - -
Exceptional items
before taxation
and minority interest
- discontinued - - - (70) - (49.5)
operations
Taxation on above
items
- continuing (2) - (1.4) (4) - (2.8)
operations
Tax rate change -
effect on opening
deferred tax balance
- continuing (11) - (7.7) - - -
operations
Exchange on tax
balances
- continuing 2 - 1.4 20 - 14.1
operations
Minority interest
- continuing 1 - 0.7 (4) - (2.8)
operations
Underlying EPS 165 141,727, 116.4 137 141,384, 96.9
124 398
- continuing 177 - 124.9 137 - 96.9
operations
- acquisitions (12) - (8.5) - - -
Analysis of net borrowings
At At
1 Subsidiary Exchange 30
October Acquired* Cash Movements September
2004 $m flow $m 2005
$m $m $m
Cash 20 - (9) - 11
Overdrafts (22) - 21 - (1)
(2) - 12 - 10
Convertible (216) - - - (216)
Bonds
Loans due after (56) (60) (178) (2) (296)
one year
Loans due (1) - (85) - (86)
within one year
Net borrowings (275) (60) (251) (2) (588)
* excludes cash in subsidiary acquired of $5 million
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 2005 and 2004.
Statutory accounts for 2004 have been delivered, and for 2005 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 2005 Lonmin Accounts will be posted to shareholders and will be
available at the Company"s registered office before the end of November 2005.
Final Dividend Timetable
The Board of Lonmin Plc has recommended a final dividend for the year ended 30
September 2005 of (42.0) US cents per share.
The dividend timetable in respect of this dividend, assuming shareholder
approval at the AGM, is as follows :-
Last day to trade cum div
SA Friday 6 January 2006
UK Tuesday 10 January 2006
Shares commence trading ex div
SA Monday 9 January 2006
UK Wednesday 11 January 2006
Dividend record date
Friday 13 January 2006
Last day for receipt of new applications to participate in
Dividend Re-investment Plan
SA Wednesday 1 February 2006
UK Wednesday 25 January 2006
Dividend payment date
Wednesday 8 February 2006
The South African branch register will be closed for the purposes of
dematerialisation, rematerialisation and transfers to and from the UK register
from Monday 9 January 2006 to Friday 13 January 2006, both dates inclusive.
The dividend will be paid :-
1) In Sterling to shareholders domiciled in the UK (unless they
elect to receive US dollar dividends) calculated at the US
dollar to sterling exchange rate on Friday 20 January 2006,
which rate will be announced on that day
2) In Rand to shareholders on the SA branch register calculated
at the Rand to US dollar exchange rate on Thursday 29
December 2005, which rate will be announced on that day and
3) In dollars to all other overseas shareholders (unless they
elect to receive Sterling dividends or have mandated their
dividends to a UK bank or participate in TAPS.).
Elections to receive an alternative currency (dollars or sterling) should
comprise a signed request to Lloyds TSB Registrars to be received by 1700 hours
on Friday 13 January 2006.
Annual General Meeting
The 2006 Annual General Meeting will be held on 26 January 2006 at the Queen
Elizabeth II Conference Centre, Board Sanctuary, Westminster, London SWIP 3EE.
Availability of this report
This report is available on the Lonmin website (www.lonmin.com)
Date: 16/11/2005 09:28:09 AM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
Sharenet Sites 
