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JBL - Jubilee Platinum Plc - Interim report for the six months ended 31 December
2011
Jubilee Platinum Plc
Registration number 4459850
(Incorporated in England and Wales)
JSE share code: JBL
AIM share code: JLP
ISIN:GB0031852162
INTERIM REPORT FOR THE SIX MONTHS ENDED 31 DECEMBER 2011
The Board of Jubilee Platinum Plc, the AIM traded and JSE-listed `mine-to-
metals` exploration and development company (the "Company" or "Jubilee" or "the
Group"), is pleased to announce the interim results for the six months ended 31
December 2011.
HIGHLIGHTS IN THE PERIOD UNDER REVIEW
- Company produced its initial platinum containing alloy for export, in March
2012 and will continue to increase the production of this material.
- The new 5MVA furnace commissioned at Middelburg became operational in November
2011 with the Middelburg operation reaching a record production of 774 tonnes of
ferroalloy in January 2012 and 818 tonnes in March 2012. Ramping up of the
operation continues in order to reach targeted full production of 1200 tonnes of
alloy per month.
- The Middelburg site continues to increase revenues and generating cash flow in
line with the ramp-up of the operation since November 2011.
- Company focussed on advancing current and several new opportunities for
ConRoast including potential rights to chromite tailings, existing joint
ventures, securing prospecting and mining rights for its PGM-bearing chromite
deposits in the western Bushveld.
- Tjate/Jubilee received a cash offer of ZAR75 million for Quartzhill farm
portion of the Tjate platinum deposit - Quartzhill is considered not being core
to Tjate`s long term mining plan.
- A Mining Right Application has been submitted for the Tjate Platinum project.
- Jubilee concluded a drilling program for new samples on the Leinster nickel
sulphide tailings for testwork at Mintek South Africa.
- The Company raised GBP4.422 million through a placing of 31 585 714 new
Jubilee oridnary shares with major insitutional investors at a price of 14 pence
(ZAR1.72)
Leon Coetzer, CEO of Jubilee Platinum commented: "The results for the six months
period reflect the increased costs associated with the commissioning activities
and operations ramp up of the new furnace installation. We are pleased to have
reached measurable increases in production at the smelter operation on the back
of the new furnace ramp up, reaching 818 tons of nickel rich ferroalloy in March
2012. We look forward to maintaining this momentum through the remainder of the
financial year as we target 1200 tons per month of ferroalloy production. We
continue with our plans to migrate the smelting facility towards increasing the
production of platinum rich alloy and to pursuing Tjate`s mining right
application in order to advance the Tjate project."
CHAIRMAN`S REPORT
Dear Shareholder,
The Company operated in a challenging six months period ending 31 December 2011
making significant positive progress in the implementation of its Mine-to-Metal
business strategy.
In the period under review:
The Company on behalf of its subsidiary Tjate Platinum Corporation (Pty) Ltd
("Tjate Platinum") received a ZAR75M cash offer from a major mining company for
the Quartzhill farm, a portion of the Tjate Platinum`s Project. This offer
represents a premium of nearly double the pro-rated original purchase price for
the farm, which is not core to Tjate Platinum`s long-term mining plan for the
project. This offer, which Jubilee is recommending to Tjate Platinum
shareholders, is subject, inter alia, to the approval of 80% of Tjate Platinum
shareholders, regulatory approvals and due diligence by the offeror. The offer
is a vindication of Jubilee`s acquisition of a substantial interest in what is
arguably the largest undeveloped block of platinum in the eastern Bushveld.
The Company awaits the Department of Mineral Resources` ("DMR") acceptance of
Tjate Platinum`s application for a mining right.
Applications for other Jubilee projects being considered by the DMR include
mining right applications by the Company`s subsidiary Maude Mining and
Exploration for platinum to portions on Elandsdrift and Bokfontein farms; and a
prospecting right for platinum and chromite in a separate venture for farms
comprising more than 64 other portions of the Bokfontein farm.
The Company`s new ferroalloy smelting furnace (5MVA AC) in Middelburg became
operational in November 2011 with the Middelburg operation reaching in January
2012(post interims) a record 774 tonnes of ferroalloy production and a new high
in March 2012 of 818 tonnes of ferroalloy. This steady progress in production
ramp up of the new furnace reflects the successful use of improved refractory
materials for the furnace shell lining and tap blocks resulting in materially
less corrosion of the linings and in turn less furnace downtime. The increase in
production has resulted in a strong increase in revenues generated by the
operation (from November 2011 and post interims). The management continues to
ramp up production towards its targeted design output of 1200 tonnes ferroalloy
per month.
The Company continued its dialogue with Northam Platinum under its Memorandum of
Understanding to establish a joint venture to evaluate the construction of a
dedicated 5MW DC arc furnace facility using ConRoast technology specifically to
smelt concentrate produced from Northam`s developing Booysendal mine in the
eastern Bushveld.
The Department of Economic Development, Environment and Tourism issued the
Company`s subsidiary Jubilee Smelting and Refining (Pty) Ltd. ("JSR") in
Middelburg with an Atmospheric Emission Licence in respect of its current and
submitted new planned operations. JSR`s smelter operation is now fully permitted
for the implementation of the ConRoast process and associated refining of the
PGM containing alloy. This, together with maximising cash flow from the
ferroalloy smelting process, significantly advances JSR`s medium term mission
for the implementation of the complete ConRoast platinum smelting process and
further strengthens its position in negotiations in sourcing PGM-rich chromite
tailings.
The Company has continued to assess and enter into dialogue with owners of near-
term PGM-rich chromite mining and tailings retreatment opportunities. Jubilee is
in a unique position to avail itself of these opportunities due to its ability
to process platinum concentrates containing high chrome values. The Company has
submitted a bid for the processing of a platinum-bearing chromite tailings
opportunity and expects the outcome of the bid to be announced within Quarter 2
of 2012. Processing of own platinum concentrates significantly enhances the
business model for the Company.
In Madagascar, the Company`s 2011 planned drilling programme for the Ambodilafa
project has been delayed due to difficulties with the local drilling contractor.
The Company continues to review its strategic options for continued exploration
in the country.
Jubilee`s Australian subsidiary, Braemore Nickel (Pty) Ltd ("Braemore")
concluded a drilling program on the Leinster nickel sulphide tailings to obtain
fresh samples for testwork at Mintek South Africa, in order to refine the
scoping flowsheet on the Nickel Tailings Project.
During the period under review, the Company made a loss attributable to
shareholders of GBP3,347,944 compared to a loss of GBP1,252,442 in the six
months ended 31 December 2010. The loss per share for the period under review
was 1.24 pence against a loss of 0.76 pence for the interim period ending 31
December 2010. Of this 1.24 pence loss per share, depreciation accounted for
0.27 pence per share.
In October 2011, the Company raised GBP4.422 million gross through a placing
with major institutions of 31,585,714 new ordinary shares of 1 pence each in the
Company at 14p per share representing a 12% premium to the then prevailing
market price.
Colin Bird
CHAIRMAN
29 March 2012
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
for the period ended 31 December 2011
Six months ended Year ended
31 December 2011 31 December 2010 30 June 2011
Unaudited Unaudited Audited
GBP`000 GBP`000 GBP`000
Revenue 1 316 3 567 5 503
Cost of sales (1 102) (2 168) (5 241)
214 1 399 262
Other administrative (4 016) (2 697) (6 772)
expenses
Total administrative (4 016) (2 697) (6 772)
expenses
Operating loss (3 802) (1 298) (6 510)
Finance income 15 46 149
Finance cost (187) - (648)
Impairment loss on - (1) -
intangibles
Loss before tax expense (3 974) (1 253) (7 009)
Tax - - (580)
Loss for the period (3 974) (1 253) (7 589)
after tax expense
OTHER COMPREHENSIVE
INCOME
Exchange (loss)/gain on (5 251) - 4 116
translation of foreign
subsidiaries
Total comprehensive (9 225) - (3 473)
loss for the year
Loss attributable to:
Equity shareholders (3 348) (1 253) (6 821)
Non-controlling (626) - (768)
interest
(3 974) (1 253) (7 589)
Total comprehensive
income attributable to:
Equity shareholders (8 599) (1 253) (2 705)
Non-controlling (626) - (768)
interest
(9 225) (1 253) (3 473)
Earnings per share
Basic and diluted loss (1,24) (0,76) (2,67)
per share (pence)
`000 `000 `000
Number of shares in 288 122 256 536 256 536
issue
Weighted average number 270 269 165 593 255 835
of shares in issue
CONSOLIDATED AND COMPANY STATEMENTS OF FINANCIAL POSITION
as at 31 December 2011
31 December 2011 31 December 2010 30 June 2011
Unaudited Unaudited Audited
GBP`000 GBP`000 GBP`000
ASSETS
Intangible assets 84 277 86 125 88 222
Property, plant and 13 445 10 406 15 360
equipment
Deferred tax 519 - 519
Total non-current 98 241 96 531 104 101
assets
Current assets
Trade and other 1 762 3 025 3 121
receivables
Inventory 884 956 830
Cash and cash 2 315 9 987 2 007
equivalents
Total current assets 4 961 13 968 5 958
TOTAL ASSETS 103 202 110 499 110 059
LIABILITIES
Non-current liabilities
Long-term liabilities (1 690) - (2 504)
Deferred tax (18 231) (16 575) (18 240)
Total non-current (19 921) (16 575) (20 744)
liabilities
Current liabilities
Contingent/Deferred - (1 400) -
consideration
Loans to related (1 455) - (1 280)
parties
Trade and other (1 273) (4 226) (2 575)
payables
Short-term liabilities (878) - (981)
Tax (625) - (625)
Total current (4 231) (5 626) (5 461)
liabilities
TOTAL LIABILITIES (24 152) (22 201) (26 205)
NET ASSETS 79 050 88 298 83 854
EQUITY
Share capital 2 881 2 565 2 565
Share premium 61 701 57 595 57 595
Merger reserve 23 184 23 184 23 184
Share-based payments 5 171 3 548 5 171
reserve
Currency translation 9 252 15 607 14 503
reserve
Retained deficit (24 405) (14 201) (21 057)
TOTAL EQUITY 77 784 88 298 81 962
Equity interest of non- 1 266 - 1 892
controlling interest
NET EQUITY 79 050 88 298 83 854
CONSOLIDATED AND COMPANY STATEMENTS OF CASH FLOWS
for the period ended 31 December 2011
Six months ended Year ended
31 December 2011 31 December 2010 30 June 2011
Unaudited Unaudited Audited
GBP`000 GBP`000 GBP`000
Cash flows from
operating activities
Loss for the period (3 974) (1 253) (7 009)
Finance income (15) 46 (149)
Finance expense 187 - 648
Depreciation 727 22 1 278
Share-based payment - 543 766
Other non-cash - 5 220 -
movements
Amortisation of 520 545 1 221
intangibles
Increase in inventory (54) (274) (148)
Decrease/(Increase) in 1 359 5 334 (2 191)
receivables
(Increase)/Decrease in (1 302) 2 459 (1 321)
payables
Net cash (2 552) 12 642 (6 905)
(outflow)/inflow from
operating activities
Cash flows from
investing activities
Increase in loans and - (465) -
investments
Acquisition of - - (6 578)
subsidiary, net of cash
acquired
Funding of deposit - - 7 652
account for business
combination
Purchase of intangible (899) (5 419) (2 284)
fixed assets
Purchase of property, (663) (10 406) (1 472)
plant and equipment
Net cash used in (1 562) (16 290) (2 682)
investing activities
Cash flows from
financing activities
Issue of shares and 4 422 638 -
warrants
Acquisition of non- - - (1 640)
controlling interest
Net cash generated 4 422 638 (1 640)
from/(utilised in)
financing activities
Net increase/(decrease) 308 (3 010) (11 227)
in cash and cash
equivalents
Cash and cash 2 007 12 997 12 997
equivalents at
beginning of the period
Effects of foreign - - 237
exchange on cash and
cash equivalents
Cash and cash 2 315 9 987 2 007
equivalents at end of
the period
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
for the period ended 31 December 2011
Share-
based
Share Share Merger payment
Group capital premium reserve reserve
GBP`000 GBP`000 GBP`000 GBP`000
Balance at 1 July 2010 2 545 56 977 23 184 3 005
Issue of share capital 20 618 - -
Share-based payment - - - 766
charge
Deferred consideration - - - 1 400
transferred
Total comprehensive loss - - - -
for the period
Acquisition of subsidiary - - - -
Acquisition of non- - - - -
controlling interest
Balance at 30 June 2011 2 565 57 595 23 184 5 171
Issue of share capital 316 4 106 - -
Total comprehensive loss - - - -
for the period
Acquisition of subsidiary - - - -
Acquisition of non- - - - -
controlling interest
Balance at 31 December 2 881 61 701 23 184 5 171
2011
Currency Non-
translation Retained controlling Total
Group reserve deficit interest equity
GBP`000 GBP`000 GBP`000 GBP`000
Balance at 1 July 2010 10 387 (12 948) - 83 150
Issue of share capital - - - 638
Share-based payment - - - 766
charge
Deferred consideration - - - 1 400
transferred
Total comprehensive loss 4 116 (6 821) (768) (3 473)
for the period
Acquisition of subsidiary - - 3 012 3 012
Acquisition of non- - (1 288) (352) (1 640)
controlling interest
Balance at 30 June 2011 14 503 (21 057) 1 892 83 854
Issue of share capital - - - 4 422
Total comprehensive loss (5 251) (3 348) (626) (9 225)
for the period
Acquisition of subsidiary - - - -
Acquisition of non- - - - -
controlling interest
Balance at 31 December 9 252 (24 405) 1 266 79 050
2011
NOTES TO INTERIM FINANCIAL STATEMENTS
1. Basis of preparation
These financial statements have been prepared in accordance with the framework
concepts and the measurement and recognition requirements of IFRS and the AC 500
Standards as issued by the Accounting Practices Board and containing the
information required by IAS 34: Interim Financial Reporting.
The accounting policies have been applied consistently throughout the Group and
are consistent with those for the financial year ended 30 June 2011.
2. Commitments and contingencies
There are no material contingent assets or liabilities at 31 December 2011.
Capital commitments at 31 December 2011:
December 2011 June 2011
GBP`000 GBP`000
Not longer than one year 22 22
Longer than one year and not longer than 48 59
five years
70 81
3. Dividend
No dividends were declared during the period ended 31 December 2011.
4. Board
No changes were made to the Board of Directors.
5. Business segments
In the opinion of the Directors, the operations of the Group companies comprise
five reporting segments, being:
- the evaluation and development of PGM smelters utilising exclusive
commercialisation rights of the ConRoast smelting process, located in South
Africa ("Evaluation and Development");
- the evaluation of the reclamation and processing of sulphide nickel tailings
at BHP Billiton`s Leinster, Kambalda and Mount Keith properties in Australia
("Nickel tailings");
- Development of Platinum Group Elements ("PGE`s") and associated metals ("PGE
development");
- Base Metal Smelting in South Africa; and
- Electricity Generation.
The parent company operates a head office based in the United Kingdom which
incurred certain administration and corporate costs. The Group`s operations span
five countries: South Africa, Australia, Madagascar, Mauritius and the United
Kingdom. There is no difference between the accounting policies applied in the
segment reporting and those applied in the Group financial statements. Mauritius
and Madagascar do not meet the qualitative threshold under IFRS 8, consequently
no separate reporting is provided.
South South
Africa Australia Africa
Evaluation PGE
and Nickel develop- Corporate
Development tailings ment (Unallocated)
Year ended Year ended Year ended Year ended
31 December 31 December 31 December 31 December
2011 2011 2011 2011
GBP GBP GBP GBP
Total revenues - - - -
Inter-company - - - -
revenue
Revenue from - - - -
external customers
Loss before tax (690) (54) (143) (805)
Tax - - - -
Loss after tax (690) (54) (143) (805)
Interest received 10 - - 5
Interest paid - - - 10
Depreciation and 525 - 5 1
amortisation
Total assets 46 164 23 756 11 929 2 943
Total liabilities - (6) (14) (18 785)
South South
Africa Africa
Base
Metal Electricity
Smelting Generation Total
Year ended Year ended Year ended
31 December 31 December 31 December
2011 2011 2011
GBP GBP GBP
Total revenues 2 263 1 181 3 444
Inter-company (947) (1 181) (2 128)
revenue
Revenue from 1 316 - 1 316
external customers
Loss before tax (2 772) 490 (3 974)
Tax - - -
Loss after tax (2 772) 490 (3 974)
Interest received - - 15
Interest paid - 177 187
Depreciation and 507 209 1 247
amortisation
Total assets 12 117 6 293 103 202
Total liabilities (5 344) (3) (24 152)
South South
Africa Australia Africa
Evaluation PGE
and Nickel develop- Corporate
Development tailings ment (Unallocated)
Year ended Year ended Year ended Year ended
31 December 31 December 31 December 31 December
2010 2010 2010 2010
GBP GBP GBP GBP
Loss on ordinary - 40 (95) (1 198)
activities
Total assets - 18 396 64 177 5 725
South South
Africa Africa
Base
Metal Electricity
Smelting Generation Total
Year ended Year ended Year ended
31 December 31 December 31 December
2010 2010 2010
GBP GBP GBP
Loss on ordinary - - (1 253)
activities
Total assets - - 88 298
6. Loss per share and headline loss per share
The loss at 31 December 2011 to shareholders is GBP3,348 million (31 December
2010 loss GBP1,253 million). This is divided by the weighted average number of
ordinary shares in issue calculated to be 270 269 750 (31 December 2010 163 593
604).
The fully diluted loss per share is based on the loss for the financial year
divided by the weighted average number of shares and potential shares being 270
269 750 (December 2010: 163 593 604) in issue during the financial year. As the
options are non-dilutive, no diluted loss per share has been calculated.
December 2011 December 2010
`000 `000
Ordinary shares - weighted average 270 270 163 594
Effect of options issued at fair value - - -
weighted average
270 270 163 594
Reconciliation of headline loss:
December 2011 December 2010
GBP`000 GBP`000
Loss attributable to Jubilee (3 348) (1 253)
shareholders
Impairment of assets - -
Loss on disposal of foreign subsidiary - -
Loss on disposal of plant and equipment - -
Headline loss (3 348) (1 253)
Headline loss per share (pence) (1,24) (0,76)
Diluted loss per share (pence) (1,24) (0,76)
7. Shares issued
In October, the Company raised GBP4.422 million through a placing with major
institutions of 31 585 714 new ordinary shares of 1 pence each in the Company at
14 pence per share, representing a 12% premium to the then prevailing market
price.
8. Interim report
Copies of the interim report are available to the public free of charge from the
Company at 4th Floor, Cromwell Place, London, SW7 2JE and from Building B, 1st
Floor, corner Witkoppen Road and Waterford Place, Paulshof, Johannesburg, during
normal office hours for 30 days from the date of this report and available for
download from: www.jubileeplatinum.com
Jubilee Platinum Plc
Colin Bird/Leon Coetzer/Andrew Sarosi
Tel +44 (0) 20 7584 2155
Tel +27 (0) 11 465 1913/+44 (0) 1752 221937
finnCap Ltd
Matthew Robinson/Ben Thompson - corporate finance
Joanna Weaving - corporate broking
Tel +44 (0) 20 7220 0500
Shore Capital Stockbrokers Limited (Joint Broker)
Jerry Keen/Edward Mansfield
Tel: +44 (0) 20 7 408 4090
Sasfin Capital
Leonard Eiser/Sharon Owens
Tel +27 (0) 11 809 7500
Bishopsgate Communications Limited
Nick Rome/Shabnam Bashir
Tel +44 (0) 20 7562 3350
Johannesburg
29 March 2012
Sponsor
Sasfin Capital (a division of Sasfin Bank Limited)
Date: 29/03/2012 08:00:04 Supplied by www.sharenet.co.za
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