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AQP - Aquarius Platinum Limited - Second Quarter 2011: Production Results
Aquarius Platinum Limited
(Incorporated in Bermuda)
Registration Number: EC26290
Share Code JSE: AQP
ISIN Code: BMG0440M1284
SECOND QUARTER 2011: PRODUCTION RESULTS
Highlights
- Attributable production increased by 3% quarter-on-quarter and by 14%
compared to Q2 2010, to 127,579 PGM ounces
- Average PGM Dollar prices improved through quarter - platinum up 9%,
palladium up 37% and rhodium up 2%
- The Rand strengthened against the Dollar by 6% on average and by 5% over
the quarter
- Weighted average cost per PGM ounce improved by 13% in local currency terms
compared to prior quarter
Q2 2011 Operating Results Summary
Kroon Marik Evere Blue Mimos CTRP Plat.
dal ana st * Ridge a Mile
+
4E PGM
Production
Total (100% 119,4 32,83 25,14 - 47,02 1,451 4,121
basis) 44 1 4 3
Attributable 59,72 16,41 25,14 - 23,51 725 2,061
2 5 4 2
4E Basket
Price
R/oz 10,08 10,07 9,881 - - 10,79 9,955
9 2 6
$/oz 1,457 1,455 1,427 - 1,207 1,559 1,447
Cash Costs
(4E basis)
R/oz 5,497 7,412 6,984 - - 5,763 5,519
$/oz 794 1,071 1,009 - 656 832 802
Cash Margin 42 24 34 - 55 26 37
Stay-in-
Business
Capex
R/oz 812 1,042 909 - - - -
-
$/oz 117 151 131 - 311 - -
* Everest is in ramp-up
+ Blue Ridge is in the process of redevelopment
Commenting on the results, Stuart Murray, CEO of Aquarius Platinum said:
"The business has produced much improved production results this quarter, and I
am pleased in particular by the performance of our South African operations.
Production was up strongly at Kroondal, our flagship asset, and both Kroondal
and Marikana managed to reduce Rand cash costs despite ongoing cost pressures.
Everest remains on schedule and continues to ramp up smoothly, already in
significantly positive cash margin territory, while good progress was made on
the Blue Ridge redevelopment project. At Mimosa bad ground was encountered
across most sections of the mine, resulting in above budget usage of roof
support materials, slightly lower production and increased costs, exacerbated by
a stronger Rand. Nonetheless, Aquarius as a whole had a very good quarter from
an operating perspective, further outperforming our very creditable Q1 and
placing the business on a strong footing ahead of the traditionally more
challenging Q3 and Q4 periods. The Group remains well on target to meet
production guidance for the 2011 financial year."
Production by mine
PGMs Quarter ended
(4E)
Dec 2010 Sep 2010 % Dec 2009 %
Change Change
Kroondal 119,444 110,575 8% 108,254 10%
Marikana 32,831 27,756 18% 37,160 -12%
Everest 25,144 20,417 23% - -
Blue - 8,092 - 18,598 -
Ridge
Mimosa 47,023 54,133 -13% 50,079 -6%
CTRP 1,451 1,470 -1% 2,087 -30%
Platinum 4,121 3,923 5% 8,539 -52%
Mile
Total 230,014 226,366 2% 224,717 2%
Production by mine attributable to Aquarius
PGMs Quarter ended
(4E)
Dec 2010 Sep 2010 % Dec 2009 %
Change Change
Kroondal 59,722 55,287 8% 54,127 10%
Marikana 16,415 13,878 18% 18,580 -12%
Everest 25,144 20,417 23% - -
Blue - 4,046 - 9,299 -
Ridge
Mimosa 23,512 27,067 -13% 25,039 -6%
CTRP 725 735 -1% 1,044 -31%
Platinum 2,061 1,962 5% 4,270 -52%
Mile
Total 127,579 123,392 3% 112,359 14%
Aquarius Group attributable production (PGM ounces) to 30 December 2010
(Please refer to www.aquariusplatinum.com for the graph)
Market Summary
Metals prices
Platinum and palladium prices continued to strengthen in dollar terms throughout
the quarter under review, with platinum above $1,650/oz and palladium above
$560/oz throughout the period. The driver of this price strength remains largely
investment demand and the weak dollar as a result of continuing quantitative
easing in the US. Some improved fundamental demand in the form of encouraging US
automotive numbers and strong demand from Heavy Duty Diesel (HDD) applications
was seen late in the quarter, however. The average platinum price rose by 9% and
that of palladium rose 37%. Rhodium and gold rose by 4% and 12% on average
respectively. Platinum closed the quarter up 6% at $1,755 per ounce, and
palladium rose by 39% to $797 per ounce over the same period. The rhodium price
rose only 5% to $2,425 per ounce over the quarter, but has continued to rise in
January. Gold rose 8% to $1,413 per ounce.
Rand-Dollar exchange rate
The average Rand-Dollar exchange rate for the quarter strengthened by 6% from
R7.33 to R6.91 to the US dollar, as the Rand carry trade continues to be
supported by low interest rates in the Euro and Dollar zones and further
quantitative easing. The Rand closed the quarter up 5% at R6.63 to the Dollar.
The strength of the Rand has once again tempered the increase in Rand basket
prices, but average PGM basket prices nonetheless strengthened at all operations
in both currencies over the quarter. The US Dollar weighted average group basket
price increased by 11% to $1,405 per 4E PGM ounce compared to the previous
quarter, while the weighted average basket price at the South African operations
was $1,450 per PGM ounce. The average South African basket price was R10,098 per
PGM ounce for the period, a 5% increase compared to the prior quarter. Rand
basket prices have continued to improve in January.
(Please refer to www.aquariusplatinum.com for the following graphs)
12-month individual PGM prices to December 2010 (US$/oz)
12-month PGM basket prices to Dec 2010 (US$ and ZAR per PGM basket ounce)
12-month Rand-Dollar exchange rate to December 2010 (ZAR/US$)
Average PGM basket prices achieved at Aquarius operations
US$ per Quarter ended
PGM
ounce
(4E)
Dec 2010 Sep 2010 % Dec 2009 %
Change Change
Kroondal 1,457 1,307 11% 1,163 25%
Marikana 1,455 1,306 11% 1,173 24%
Everest 1,427 1,265 13% - -
Blue - 1,301 - 1,138 -
Ridge
Mimosa 1,207 1,144 6% 910 33%
CTRP 1,559 1,426 9% 1,266 23%
Platinum 1,447 1,300 11% 1,192 21%
Mile
Weighted 1,405 1,265 11% 1,108 27%
Avg.
Operating Review Summary (all numbers on 100% basis)
AQUARIUS PLATINUM (SOUTH AFRICA) (PTY) LTD (Aquarius Platinum - 100%)
P&SA 1 at Kroondal (Aquarius Platinum - 50%)
- 12-month rolling average DIIR improved to 0.74 per 200,000 man hours from
0.78 in the previous quarter
- Production increased by 8% to 1,752,590 tonnes
- Head grade improved from 2.62 g/t to 2.63 g/t
- Recoveries decreased by 1% to 80%
- Volumes processed increased by 8% to 1,762,061 tonnes
- Stockpiles at the end of the quarter totalled approximately thirty four
thousand tonnes
- PGM production increased by 8% to 119,444 PGM ounces
- Revenue increased by 23% to R1,134 million due to improved production and
basket price
- Mining cash costs decreased by 9% to R373 per tonne, and costs per PGM
ounce by 9% to R5,497
- Kroondal`s cash margin for the period improved from 28% to 42%
P&SA2 at Marikana (Aquarius Platinum - 50%)
- 12-month rolling average DIIR improved to 0.61 per 200,000 man hours from
0.76 in the previous quarter
- Production increased by 19% to 612,389 tonnes; 488,689 from underground and
123,699 from open pit
- Head grade decreased by 7% to 2.31 g/t
- Recoveries increased by 3% to 71%
- Volumes processed increased by 23% to 623,942 tonnes
- PGM production increased by 18% to 32,831 ounces
- Revenue increased by 34% to R321 million due the improved production and
basket price
- Mining cash costs decreased by 18% to R390 per tonne, and costs per PGM
ounce by 15% to R7,412
- Marikana`s cash margin improved from -1% to 24%
- 1 Shaft became uneconomical during the quarter and is being placed on care
and maintenance - development has been stopped and stoping will stop in
June 2011
Everest Mine (Aquarius Platinum - 100%)
- 12 month rolling DIIR fell to 0.25 per 200,000 man hours from 0.18 in the
previous quarter
- Production increased by 36% to 348,469 tonnes
- Head grade improved from 2.75 g/t to 2.80 g/t
- Recoveries increased from 77% to 81%
- Better recoveries due to increased underground tonnes processed coupled
with stabilisation of the plant after re-commissioning
- Volumes processed increased by 14% to 342,624 tonnes
- PGM production increased by 23% to 25,144 PGM ounces
- Revenue increased by 39% to R265 million all attributable to AQPSA
- Mining cash costs decreased by 16% to R513 per tonne, and costs per PGM
ounce by 22% to R6,984
- Everest`s cash margin increased from 4% to 34%
- Re-establishment project and production ramp-up in line with plan and
progressing well
AQPSA Operating costs per ounce
4E 6E 6E net of by-
products
(Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni&Cu)
Kroondal 5,497 4,494 4,356
Marikana 7,412 6,078 5,844
Everest 6,984 5,801 5,091
Update on impact of revised hangingwall support strategy
The majority of the action steps to implement the new support system have been
implemented at Kroondal, Marikana and Everest. At Kroondal the new methodologies
have already resulted in a decrease in fall-of-ground incidents. The additional
support strategy will be fully implemented at Kroondal and Marikana in the next
quarter.
Capital expenditure
As a result of a decision to buy as opposed to rent Underground Mobile
Equipment, AQPSA has changed its accounting policy to include these expenses as
a capital expenditure during the quarter the asset is procured, and not as an
operating lease as was the case previously. New mobile equipment is being
depreciated over a 3 year period. This change has not had a material effect on
unit cash costs in the current period, but it will gradually reduce cash costs,
concomitant with an increase in capital expenditure in future.
Stay-in-business capital expenditure (including ongoing infrastructure
establishment) increased over the quarter as a result of additional one-off
expenditure on equipment for the new hanging-wall support methodologies.
Kroondal Marikana Everest
Total Per 4E Total Per 4E Total Per 4E
oz oz oz
Ongoing Infrastructure R68m R570 R29m R891 R23m R909
Establishment
Project Capital R17m R141 - - R26m R1,037
Mobile Equipment R12m R101 R5m R152 R23m R897
Total R97m R812 R34m R1,042 R72m R2,844
RIDGE MINING LIMITED (Aquarius Platinum - 50%)
Blue Ridge Platinum Mine
- 1 Fatality was reported following a blasting accident on 2 November 2010
- 12-month rolling average DIIR was unchanged from the previous quarter at
2.02 per 200,000 man hours
- Mine closed for redevelopment at the start of Q2
Update on redevelopment plan
The Blue Ridge redevelopment plan was approved by the Blue Ridge Board in
September 2010 and implementation commenced immediately in Q2. Stoping
operations and the processing plant were stopped, and any run-of-mine material
was stockpiled. Approximately 900 employees were redeployed, some to other
Aquarius operations, and the process was concluded satisfactorily with
retrenchments limited to a minimum.
In keeping with the plan, development was increased and infrastructure upgrade
projects were commenced during the quarter. Development for the quarter was a
total of 2,365 meters, with developed ore reserves standing at 1,843 meters.
No Revenue was generated during the quarter as a result of the temporary plant
stoppage. All expenditures continued to be capitalised. The plant has been
temporarily re-commissioned in January 2011 in order to ensure the plant remains
in a production-ready state for the commencement of stoping operations in Q4. A
full update on the redevelopment project will be included in the Interim Report
in February.
MIMOSA INVESTMENTS (Aquarius Platinum - 50%)
Mimosa Platinum Mine
- 12-month rolling average DIIR improved to 0.17 per 200,000 man hours from
0.45 in the previous quarter
- Production decreased by 14% to 560,142 tonnes
- Head grade deteriorated by 1% to 3.58g/t
- Recoveries decreased to 75% from 78%
- Volumes processed increased by 8% to 1,762,061 tonnes
- Stockpiles at the end of the quarter totalled approximately 147,193 tonnes
- PGM production decreased by 13% to 47,023 PGM ounces
- Revenue decreased by 10% to $69 million due to lower achieved sales volumes
- Mining cash costs increased by 5% to $57 per tonne, and costs per PGM ounce
by 10% to $656
- Stay-in-business capital expenditure was $311 per PGM ounce for the quarter
- Mimosa`s cash margin for the period fell from 57% to 55%
Operating cash costs per ounce
4E(Pt+Pd+Rh+Au) 6E(Pt+Pd+Rh+Ir+Ru+Au) 4E net of by-products
(Ni, Cu & Co)
Mimosa 656 622 274
TAILINGS OPERATIONS
Chromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum - 50%)
- Material processed decreased 44% to 23,000 tonnes
- Head grade increased to 3.36 g/t
- Recoveries increased by 43% to 58%
- Production increased to 1,451 PGM ounces
- Cash costs increased by 5% to R5,763 per PGM ounce
- Revenue was R11 million for the quarter
- There was no capital expenditure for the quarter
- The cash margin for the period was 26%, a increase from 17% in the previous
quarter
Platinum Mile (Aquarius Platinum - 50%)
- Material processed increased 3% to 1,153,000 tonnes
- Head grade fell slightly to 0.60 g/t
- Recoveries increased by 12% to 19%
- Production increased to 4,121 PGM ounces
- Cash costs decreased by 7% to R5,519 per PGM ounce
- Revenue was R36 million for the quarter
- There was no capital expenditure for the quarter
- The cash margin for the period was 37%, a increase from 25% in the previous
quarter
- Operating cash costs per ounce
4E(Pt+Pd+Rh+Au) 6E(Pt+Pd+Rh+Ir+Ru+Au) 4E net of by-products
(Ni, Cu& Co)
CTRP 5,763 3,999 3,903
Platinum 5,519 4,757 4,283
Mile
Statistical Information: Kroondal P&SA1
(Please refer to www.aquariusplatinum.com for the Statistical Information)
Statistical Information: Marikana P&SA2
(Please refer to www.aquariusplatinum.com for the Statistical Information)
Statistical Information: Everest
(Please refer to www.aquariusplatinum.com for the Statistical Information)
Statistical Information: Blue Ridge
(Please refer to www.aquariusplatinum.com for the Statistical Information)
Statistical Information: Mimosa
(Please refer to www.aquariusplatinum.com for the Statistical Information)
Statistical Information: Chrome Tailings Retreatment Plant
(Please refer to www.aquariusplatinum.com for the Statistical Information)
Statistical Information: Platinum Mile
(Please refer to www.aquariusplatinum.com for the Statistical Information)
Aquarius Platinum LimitedIncorporated in Bermuda
Exempt company number 26290
Board of Directors
Nicholas Sibley Non-executive Chairman
Stuart Murray Chief Executive Officer
David Dix Non-executive
Tim Freshwater Non-executive
Edward Haslam Non-executive
Sir William Purves Non-executive (Senior Independent Director)
Kofi Morna Non-executive
Zwelakhe Mankazana Non-executive
Audit/Risk Committee
Sir William Purves (Chairman)
David Dix
Edward Haslam
Kofi Morna
Nicholas Sibley
Remuneration/Succession Planning Committee
Edward Haslam (Chairman)
David Dix
Zwelakhe Mankazana
Nicholas Sibley
Nomination Committee
The full Board comprises the Nomination Committee
Company Secretary
Willi Boehm
Investor Relations
Gavin Mackay Business Development & Communications Executive
AQPSA Management
Stuart Murray Executive Chairman
Anton Lubbe Managing Director
Helene Nolte Director: Finance
Mkhululi Duka Director: Human Capital
Abraham van Ghent Senior General Manager: Operations
Graham Ferreira General Manager: Group Admin & Company Secretary
Wessel Phumo General Manager: Marikana
Gabriel de Wet General Manager: Engineering
Augustine Simbanegavi General Manager: Everest
Anthony Joubert General Manager: Blue Ridge
Mimosa Mine Management
Winston Chitando Managing Director
Herbert Mashanyare Technical Director
Peter Chimboza Resident Director
Fungai Makoni General Manager Finance & Company Secretary
Platinum Mile Management
Richard Atkinson Managing Director
Paul Swart Financial Director
Issued Capital
At 31 December 2010, the Company had in issue: 463,241,295 fully paid common
shares and 452,171 unlisted options.
Substantial Shareholders 31 Number of Percentage
December 2010 Shares
Savannah Consortium 63,254,371 13.66
JP Morgan Nominees Australia 46,135,926 9.96
Limited
HSBC Custody Nominees 38,189,609 8.25
(Australia) Limited
National Nominees Limited 32,498,637 7.02
Chase Nominees Limited 25,268,975 5.45
Trading Information
ISIN number BMG0440M1284
ADR ISIN number US03840M2089Convertible Bond ISIN number XS0470482067
Broker (LSE) (Joint) Broker (ASX) Sponsor (JSE)
Liberum Capital Euroz SecuritiesLevel Rand Merchant Bank (A
LimitedCity Point, 1 18 Alluvion58 Mounts division of FirstRand
Ropemaker Street, Bay Road, Perth WA Bank Limited) 1 Merchant
London, EC2Y 6000Telephone: +61 (0) Place Cnr of Rivonia Rd
9HTTelephone: +44 (0) 8 9488 1400 and Fredman Drive,
20 3100 2000 Sandton 2146
Bank of America Johannesburg South
Merrill Lynch2 King Africa
Edward StLondon, EC1A
1HQTelephone: +44
(0)20 7628 1000
Aquarius Platinum (South Africa) (Proprietary) Ltd
100% Owned (Incorporated in the Republic of South Africa)
Registration Number 2000/000341/07
1st Floor, Building 5, Harrowdene Office Park, Western Service Road, Woodmead
2191, South AfricaPostal Address: PO Box 76575, Wendywood, 2144, South Africa.
Telephone: +27 (0)11 656 1140
Facsimile: +27 (0)11 802 0990
Aquarius Platinum Corporate Services Pty Ltd
100% Owned
(Incorporated in Australia)
ACN 094 425 555
Level 4, Suite 5, South Shore Centre, 85 The Esplanade, South Perth, WA 6151,
Australia
Postal Address: PO Box 485, South Perth, WA 6151, Australia
Telephone: +61 (0)8 9367 5211
Facsimile: +61 (0)8 9367 5233
Email: info@aquariusplatinum.com
For further information please visit www.aquariusplatinum.com or contact:
In Australia
Willi Boehm
+61 (0) 8 9367 5211
In the United Kingdom and South Africa
Gavin Mackay
gavin.mackay@aquariusplatinum.com
+ 44 7909 547 042
Glossary
A$ Australian Dollar
Aquarius or AQP Aquarius Platinum Limited
APS Aquarius Platinum Corporate Services Pty Ltd
AQPSA Aquarius Platinum (South Africa) (Pty) Ltd
ACS(SA) Aquarius Platinum (SA) Corporate Services (Pty) Ltd
BEE Black Economic Empowerment
BRPM Blue Ridge Platinum Mine
CTRP Chrome Tailings Retreatment Operation. Consortium
comprising Aquarius Platinum (SA) (Corporate
Services) (Pty) Limited (ASACS), Ivanhoe Nickel and
Platinum Limited and Sylvania South Africa (Pty) Ltd
(SLVSA).
DIFR Disabling injury frequency rate - being the number
of lost-time injuries expressed as a rate per
1,000,000 man-hours worked
DIIR Disabling injury incidence rate - being the number
of lost-time injuries expressed as a rate per
200,000 man-hours worked
DME formerly South African Government Department of
Minerals and Energy
DMR South African Government Department of Mineral
Resources, formerly the DME
Dollar or $ United States Dollar
Everest Everest Platinum Mine
Great Dyke Reef A PGE bearing layer within the Great Dyke Complex in
Zimbabwe
g/t Grams per tonne, measurement unit of grade (1g/t = 1
part per million)
JORC code Australasian code for reporting of Minera l
Resources and Ore Reserves
JSE JSE Limited
Kroondal Kroondal Platinum Mine or P&SA1 at Kroondal
LHD Load haul dump machine
Marikana Marikana Platinum Mine or P&SA2 at Marikana
Mimosa Mimosa Mining Company (Private) Limited
nm Not measured
PGE(s) (6E) Platinum group elements plus gold. Five metallic
elements commonly found together which constitute
the platinoids (excluding Os (osmium)). These are
Pt (platinum), Pd (palladium), Rh (rhodium), Ru
(ruthenium), Ir (iridium) plus Au (gold)
PGM(s) (4E) Platinum group metals plus gold. Aquarius reports
the PGMs as comprising Pt+Pd+Rh plus Au (gold) with
the Pt, Pd and Rh being the most economic platinoids
in the UG2 Reef
PlatMile Platinum Mile Resources (Pty) Ltd
P&SA1 Pooling & Sharing Agreement between AQPSA and RPM
Ltd on Kroondal
P&SA2 Pooling & Sharing Agreement between AQPSA and RPM
Ltd on Marikana
R South African Rand
Ridge Ridge Mining Limited
ROM Run of mine. The ore from mining which is fed to the
concentrator plant. This is usually a mixture of UG2
ore and waste.
Tonne 1 Metric tonne (1,000kg)
UG2 Reef A PGE-bearing chromite layer within the Critical
Zone of the Bushveld Complex
Sponsor in South Africa
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 27/01/2011 09:00:01 Supplied by www.sharenet.co.za
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