Wrap Text
Production Results to 31 December 2013
Aquarius Platinum Limited
(Incorporated in Bermuda)
Registration Number: EC26290
Share Code JSE: AQP
ISIN Code: BMG0440M1284
Production Results to 31 December 2013
Second Quarter 2014 Production Results
Highlights
- Attributable production from operating mines up 1% quarter-on-quarter, up 7% compared to previous
corresponding period (pcp)
- Average PGM basket price decreased 2% for the quarter – down 9% compared to pcp.
- The Rand weakened against the US Dollar by 1% on average quarter-on-quarter – down 17% compared to pcp
- Cash costs at Kroondal decreased 5% to R8,612 per PGM ounce quarter-on-quarter – up 2% compared to pcp
- Cash costs at Mimosa decreased 4% to $837 per PGM ounce quarter-on-quarter – down 7% compared to pcp
- Surface stockpile at Mimosa increased – now 136,000 tonnes
Q2 2014 Operating Results Summary
Kroondal Mimosa Platinum Mile
4E PGM Production
Total (100% basis) 110,303 55,586 1,583
Attributable 55,152 27,793 1,583
4E Basket Price
R/oz 11,589 - 11,360
$/oz 1,145 1,126 1,117
Cash Costs (4E basis)
R/oz 8,612 6,641
$/oz 851 837 653
Cash Margin (%) 7 18 20
Stay-in-Business Capex
R/oz 990 - -
$/oz 98 176 -
Commenting on the results, Jean Nel, CEO Aquarius Platinum said:
The highlight of the second quarter was undoubtedly the continued increase in production and reduction in
costs at Mimosa and specifically at Kroondal which is now consistently producing at levels higher than at any
point in its 10 year life. This is testimony to excellent operational management by the AQPSA team lead by MD
Rob Schroder and Kroondal GM, Wessel Phumo as well as a motivated stable work force at Kroondal. The
improved cost performance partially offset the lower prices which prevailed during the quarter.
At Mimosa production was stable and costs reduced further, in line with expectations. Unfortunately Mimosa
does not benefit from a weakening currency and hence the lower Dollar metal prices impacted its margin
directly. Platinum Mile’s production for the quarter was at reduced levels following interruptions in its feed
caused by industrial action at Anglo Platinum, but still managed a credible performance for the half year.
Overall the company’s safety, production and cost performance continued to improve and are at credible levels.
The challenge is to maintain this credible performance whilst making incremental productivity and efficiency
improvements, something we are absolutely committed to.
The quarter also saw a further decline in Dollar and Rand metal prices. At the prices which prevailed during the
quarter our business remains marginal, despite the cost reductions which we have successfully implemented.
The decline in metal prices reversed after quarter end, albeit for the wrong reasons, as industrial action looms in
South Africa and regulatory uncertainty continues in Zimbabwe. For as long as this increase prevails we will
benefit from higher revenues and margin expansion provided production remains uninterrupted. Our resolute
focus on incremental improvements in safety, production and costs remains paramount with improvement
programs in place across all operations.
The continued regulatory uncertainty in Zimbabwe is of particular concern to us as it impacts Mimosa’s ability to
plan future production levels and capital allocation efficiently. Discussions with the Government of Zimbabwe
continue and, seeing as we share the Government of Zimbabwe’s vision for a healthy growing Zimbabwean
platinum mining sector, we remain hopeful the matters could be agreed in due course.
Production by mine
Quarter ended
PGMs (4E)
Dec 2013 Sept 2013 % Change Dec 2012 % Change
Kroondal 110,303 106,441 4 102,525 8
Mimosa 55,586 53,048* 5 52,752 5
Platinum Mile 1,583 3,729 (58) 1,349 17
Total 167,472 163,218 3 156,626 7
*comparative figure (Sept '13) has been amended to reflect adjustment in production ounces reconciled.
Production by mine attributable to Aquarius (Operating mines)
Quarter ended
PGMs (4E)
Dec 2013 Sept 2013 % Change Dec 2012 % Change
Kroondal 55,152 53,220 4 51,262 8
Mimosa 27,793 26,524* 5 26,376 5
Platinum Mile 1,583 3,729 (58) 1,349 17
Total 84,528 83,473 1 78,987 7
*comparative figure (Sept '13) has been amended to reflect adjustment in production ounces reconciled.
Aquarius Group quarterly attributable production (PGM ounces) to 31 December 2013
Please refer to www.aquariusplatinum.com for the graph.
Market Summary
The second quarter PGM Rand basket price performance was characterised by the same volatility and overall flat
direction that characterised the rest of 2013. Like the other “Fragile Five” emerging market currencies, the South
African Rand continued to weaken on tapering fears and finished at a multiyear low against the dollar of R10.49.
This weakness in the Rand offset a small weakening in the US dollar metal prices. Platinum prices shrugged off
the strike at Northam Platinum that begun on November 4 and continued for the rest of the year, indicating the
presence of large above ground stockpiles. ETF investment demand did continue into Q2, albeit at a slower pace
than previous quarters, with c.250koz added. Non-commercial net futures positioning, that has been the key
driver for the metal price in 2013, lost c.620koz of platinum, leaving positioning a net long of 1.15 Moz and
relatively neutral compared to previous years.
The average platinum price decreased by 3.9%, while palladium increased by 0.2% and rhodium decreased by
4.6% quarter on quarter. Gold decreased by 4.3% on average. Platinum closed the quarter down 3.6% at $1,357
per ounce, while palladium fell by 1.4% to $716 per ounce and rhodium fell by 1.5% to $975 over the same
period. Gold fell 9.4% to $1,203 per ounce.
Rand-Dollar exchange rate
The average Rand-Dollar exchange rate weakened during the quarter, falling by 1.3% from R9.99 to R10.12 to
the US dollar. Since then, the Rand has weakened further to average R10.67 in the first two weeks of January.
The average Rand basket price for the quarter decreased by 2% quarter-on-quarter, and the spot price by 2%
over the period. The US Dollar weighted average group basket price decreased by 2% to $1,138 per 4E PGM
ounce compared to the previous quarter. The average South African basket price at AQPSA’s operations was
R11,624 per PGM ounce for the period. Subsequent to the end of the quarter, the PGM basket price has
consolidated to average R12,421 per PGM ounce for the first two weeks of January.
12-month individual PGM prices to December 2013
Please refer to www.aquariusplatinum.com for the graph.
12-month PGM basket prices to December 2013
Please refer to www.aquariusplatinum.com for the graph.
12-month Rand-Dollar exchange rate to December 2013
Please refer to www.aquariusplatinum.com for the graph.
Average PGM basket prices achieved at Aquarius operations
US$ per PGM Quarter ended
ounce (4E) Dec 2013 Sept 2013 % Change Dec 2012 % Change
Kroondal 1,145 1,183 (3) 1,261 (9)
Mimosa 1,126 1,128 - 1,213 (7)
Platinum Mile 1,117 1,173 (5) 1,269 (12)
Weighted Avg. 1,138 1,165 (2) 1,245 (9)
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 0.99 per 200,000 man hours from 1.05 in the previous quarter
- Production increased to 1,867,000 tonnes from 1,851,000 tonnes
- Head grade improved from 2.38 g/t to 2.42 g/t
- Recoveries improved by 2% to 79%
- Volumes processed increased to 1,800,000 tonnes, up 1% quarter-on-quarter
- Stockpiles at the end of the quarter totalled approximately 147,000 tonnes, up 67,000 tonnes
- PGM production increased by 4% to 110,303 PGM ounces
- Revenue decreased by 6% to R1,026 million quarter-on-quarter due a negative sales adjustment of R72.4
million due to the lower metal prices in the quarter
- Mining cash costs decreased by 2% to R528 per tonne, due to improved production and electricity prices
alternating to summer rates and stock pile adjustments
- Unit cost per PGM ounce reduced 5% to R8,612 per PGM ounce due improved quality and electricity
alternating to summer rates and stock pile adjustments
- Kroondal’s cash margin for the period deteriorated from 12% to 7% despite the credible cost performance
because of lower Rand prices including a negative sales adjustment of R72.4 million
Please refer to www.aquariusplatinum.com for the graph.
Commentary
Kroondal:
Production at Kroondal was maintained at 1.867 million tonnes, up 1% compared to the previous quarter. While
the iron-rich ultramafic pegmatite (IRUP) ore is still being mined at Kwezi a solution has been found to the issue
of recovery by blending the material and increasing floatation retention time in the process plants. Recoveries
thus improved by 2% quarter on quarter.
A new safety campaign was launched on the 27 of September 2013 where operations for the entire mine were
closed with the purpose of re-energising safety awareness at Kroondal. The theme for the new safety strategy is
“My Life, My responsibility, I will comply” which was settled on after an analysis was carried out on incidents and
accidents during the past year which showed that our employees don’t comply with our own standards and
procedures. The launch was also attended by the Principal Inspector of the Department of Mineral Resources
(who gave a short address) and two Senior Inspectors.
During the quarter the Kroondal work force maintained a positive outlook with open communication channels
on all levels. As previously reported, regrettably a fatal incident was recorded during the quarter at Kwezi when
Miss (Cynhthiah) Anikie Setuke was fatally assaulted at her workplace underground. There were three Section 54
instructions during this quarter in review. These resulted in an aggregate loss of 5 working days in underground
production.
P&SA2 at Marikana (Aquarius Platinum – 50%)
There has been no change to the Marikana operations which remain on care and maintenance until further
notice.
Everest Mine
There has been no change to the Everest operations which remain on care and maintenance until further notice.
AQPSA Operating cash costs per ounce (Rand)
4E 6E 6E net of by-products
(Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni&Cu)
Kroondal 8,612 7,067 6,868
Capital expenditure
Kroondal
(R’000 unless otherwise stated) Total Per 4E oz
Ongoing establishment of infrastructure 86,113 781
Project capital (K6 shaft) 23,003 209
Mobile equipment 29,539 267
Total 138,655 1,257
The Company continues to develop the K6 shaft at Kroondal and conduct design work at Everest. The K6 shaft
sinking project remains on budget and is ahead of schedule. The Company expects to incur R90 million in capital
(R45 million attributable to Aquarius) during H2 on this project, in line with budget.
The company continues to maintain all other project and growth capital expenditure on hold, pending improved
market conditions. The Company is continuing with the necessary maintenance capital expenditure required by
its operating mines. The capital expenditure on mobile equipment is financed through a lease agreement over
the life of the equipment.
Kroondal mine: reconciliation of cash costs per 4E ounce
Cost per 4E ounce
(Rand)
Q1 2014 Q2 2014
Total operating expenditure 10,076 10,106
Less:
Ongoing capital expenditure & mobile
equipment (543) (1,048)
Project capex (K6 shaft) (236) (209)
Transferred (to)/from stockpile (203) (237)
On mine cash costs 9,094 8,612
Stockpile movements
Kroondal's stockpile is utilised to maximise production efficiencies at the concentrator plants. Typically ore will
be drawn from the stockpile to cover breaks in underground mining that may occur. Ore was drawn from the
stockpile in Q3 to cover anticipated shortfalls due to the Christmas break. This will result in an increase in costs
during Q3.
MIMOSA INVESTMENTS (Aquarius Platinum - 50%)
Mimosa Platinum Mine
- 12-month rolling average DIIR deteriorated to 0.05 per 200,000 man hours worked
- Production increased by 1% to 629,101 tonnes
- Head grade improved to 3.65 g/t
- Recoveries improved slightly to 78%
- Volumes processed increased by 2% to 632,872 tonnes
- Stockpile at the end of the quarter was approximately 135,573 tonnes
- PGM production increased by 5% to 55,586 PGM ounces
- Revenue whilst flat on a PGM ounce basis, increased in line with increased ounces sold
- Mining cash costs decreased by 1% to US$75 per tonne, costs per PGM ounce decreased by 4% to $837 on
higher production
- Stay-in-business capital expenditure was $176 per PGM ounce for the quarter
- Mimosa’s cash margin for the period remained the same at 18% as in previous quarter.
Please refer to www.aquariusplatinum.com for the graph.
Commentary
The Mimosa mine continues to operate well, despite cost pressures which has increased in recent quarters. The
Mimosa management team has identified a number of cost saving initiatives which are currently being
implemented.
Operating cash costs per ounce
Unit cash cost per PGM ounce (before by-product credits) was 4% lower than those achieved in the previous
quarter on increased production. Comparatives production figures for September 2013 quarter have been
revised down by 1,031 PGM ounces on an attributable basis following reconciliation of production.
4E 6E 4E net of by-products
(Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu & Co)
Mimosa 837 792 544
Capital expenditure
The total capital expenditure for the second quarter amounted to $11.4 million (on a 100% basis, in line with the
guidance provided by AQP). Expenditure was mainly incurred on mobile equipment, Drill Rigs and LHD; Conveyor
belt extension and Down dip Development.
TAILINGS OPERATION
Platinum Mile (Aquarius Platinum – 91.7%)
- Material processed decreased 8% to 1,043,000 tonnes
- Head grade decreased to 0.62 g/t
- Recoveries decreased to 8%
- Production decreased to 1,583 PGM ounces
- Cash costs decreased to R6,641 per PGM ounce
- Revenue was lower at R13 million for the quarter due to lower production
- Cash margin for the quarter was 20%, down from 23% in the previous quarter
Commentary
Platinum Mile
The results for the quarter were negatively impacted by strikes at Anglo Platinum during the month of October
and the Christmas break in operations. A total of 21 production days were lost for these reasons.
As a result of the recent restructuring at Anglo, Platinum Mile has resumed treating UG2 material that has
traditionally provided lower recoveries at higher chrome levels. It is expected that the course grinding expansion
due to be commissioned by the end of the third quarter of this financial year will replace the lost yields resulting
from the Anglo Platinum restructuring.
Whilst the results for the quarter were impacted by the Anglo Platinum strikes and restructuring, encouragingly
a positive cash margin was achieved despite these trying circumstances.
Chromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum - 50%)
The operation remains on care and maintenance since 6 August 2012.
Operating cash costs per ounce
4E 6E 4E net of by-products
(Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu& Co)
Platinum Mile 6,641 5,726 5,212
CORPORATE MATTERS
Results of AGM
Shareholders approved all resolutions tabled at the recent AGM held on 28 November 2013. As a result, the
company has commenced the implementation of the cash preservation initiatives outlined to shareholders at
the AGM comprising:
- a reduction in directors' fees of 10% and directors’ to receive 25% of the remaining directors’ fees in shares in lieu of cash; and
- implementation of a Director and Employee Share Plan through which the CEO Mr. Nel would receive 70%
of his salary and any applicable bonuses he may receive over the next three years (commencing from 1 July
2013) in shares, instead of cash.
Zimbabwean Budget update
Mimosa has noted amendments contained in the proposed Zimbabwean national budget for 2014 which, if
implemented, will impact on the company. These include royalties which is proposed will be non-deductible for
income tax purposes (currently deductible) and an export tax on un-beneficiated platinum. The implementation
of further taxes will have a significant negative impact on the profitability and cash flows of the entire
Zimbabwean platinum sector, particularly in the current low price environment. Mimosa management in
consultation with the Zimbabwe Chamber of Mines will continue to engage with the Government of Zimbabwe
in an effort to clarify the proposed changes to the fiscal regime, acknowledging that Aquarius and Mimosa share
the vision of a growing platinum mining sector with the Government of Zimbabwe..
More information on all corporate matters can be found at www.aquariusplatinum.com
Statistical Information: Kroondal P&SA1
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: Platinum Mile
Please refer to www.aquariusplatinum.com for the Statistical Information.
Aquarius Platinum Limited
Incorporated in Bermuda
Exempt company number 26290
Board of Directors
Nicholas Sibley Non-executive Chairman
Jean Nel Chief Executive Officer
David Dix Non-executive
Tim Freshwater Non-executive (Senior Independent Director)
Edward Haslam Non-executive
Kofi Morna Non-executive
Zwelakhe Mankazana Non-executive
Sonja de Bruyn Sebotsa Non-executive
Audit/Risk Committee
David Dix (Chairman)
Edward Haslam
Tim Freshwater
Kofi Morna
Nicholas Sibley
Remuneration Committee
Edward Haslam (Chairman)
David Dix
Zwelakhe Mankazana
Nicholas Sibley
Nomination Committee
Sonja de Bruyn Sebotsa (Chairman)
Edward Haslam
Tim Freshwater
Kofi Morna
Willi Boehm
Company Secretary
Willi Boehm
AQPSA Management
Robert Schroder Managing Director
Jean Nel Executive Director
Graham Ferreira Finance Director
Wessel Phumo General Manager: Kroondal
Mimosa Mine Management
Winston Chitando Chairman
Herbert Mashanyare Technical Director
Peter Chimboza Resident Director
Fungai Makoni Managing Director
Platinum Mile Management
Richard Atkinson Managing Director
Paul Swart Financial Director
Issued Capital
At 31 December 2013, the Company had on issue: 487,605,536 fully paid common shares.
Substantial Shareholders 31 December 2013 Number of Shares Percentage
Wellington Management Company 40,593,492 8.33
The Capital Group of Companies 37,117,112 7.61
HSBC Custody Nominees (Australia) Limited 32,262,154 6.62
Primary Listing: Australian Securities Exchange (AQP.AX) Trading Information
Premium Listing: London Stock Exchange (AQP.L) ISIN number BMG0440M1284
Secondary Listing: JSE Limited (AQP.ZA) ADR ISIN number US03840M2089
Convertible Bond ISIN number XS0470482067
Broker (LSE) (Joint) Broker (ASX) Sponsor (JSE)
Liberum Capital Limited Rand Merchant Bank
Ropemaker Place, Level 12 Euroz Securities (A division of FirstRand Bank
25 Ropemaker Street, London Level 18 Alluvion Limited)
EC2Y 9LY 58 Mounts Bay Road, 1 Merchant Place
Telephone: +44 (0) 20 3100 2000 Perth WA 6000 Cnr of Rivonia Rd and Fredman
Barclays Telephone: +61 (0) 8 9488 1400 Drive, Sandton 2196
5 The North Colonnade Johannesburg South Africa
Canary Wharf
London E14 4BB
Tel: +44 (0) 20 7623 2323
Aquarius Platinum (South Africa) (Proprietary) Ltd
100% Owned
(Incorporated in the Republic of South Africa)
Registration Number 2000/000341/07
1st Floor, Block C, Rosebank Office Park, 181 Jan Smuts Avenue, Rosebank, South Africa
Postal Address: PO Box 7840, Centurion, 0046, South Africa
Telephone: +27 (0) 10 001 2848
Facsimile: +27 (0) 12 001 2070 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 the United Kingdom and South Africa: In Australia:
Jean Nel Willi Boehm
+27 (0) 10 001 2848 +61 (0) 8 9367 5211
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 Mineral 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)
TARP Trigger Action Response Procedure
UG2 Reef A PGE-bearing chromite layer within the Critical Zone of the Bushveld Complex
28 January 2014
Date: 28/01/2014 09:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
