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PAN AFRICAN RESOURCES PLC - Trading statement and ETRP update

Release Date: 12/01/2015 14:00
Code(s): PAN     PDF:  
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Trading statement and ETRP update

Pan African Resources PLC
("Pan African" or “the Company" or “the Group”)
(Incorporated and registered in England and Wales under Companies Act 1985
with registered number 3937466 on 25 February 2000)
Share code on AIM: PAF
Share code on JSE: PAN
ISIN: GB0004300496

TRADING STATEMENT AND ETRP UPDATE

In terms of paragraph 3.4(b) of the Listings Requirements of the JSE Limited,
a listed company is required to publish a trading statement as soon as it is
satisfied that a reasonable degree of certainty exists that the financial
results for the period to be reported on next, will differ by at least 20 per
cent from those of the previous corresponding period.

Pan African is incorporated in England and Wales under the Companies Act 1985
and accordingly its presentation currency is Pounds Sterling (“GBP”).

The average ZAR:GBP exchange rates affect reporting of results in GBP. For the
six month interim reporting period ended 31 December 2014, the average
prevailing ZAR:GBP exchange rate of 17.87:1 (31 December 2013: 15.94:1) was
used to translate earnings per share (“EPS”) and headline earnings per share
(“HEPS”) from ZAR to GBP. This 12.1% year-on-year change in the average
exchange rate should be taken into account for the purposes of a comparison
with the prior period.

Pan African advises shareholders that its Group EPS and HEPS for the six month
period ended 31 December 2014, calculated in ZAR, are expected to be between
60 per cent and 80 per cent lower than the 15.11 cents EPS and HEPS for the
period ended 31 December 2013. Calculated in ZAR, EPS and HEPS are therefore
expected to be between 3.02 cents and 6.04 cents. EPS and HEPS denominated in
GBP are expected to be between 63 per cent and 83 per cent lower than the 0.95
pence EPS and HEPS reported for the period ended 31 December 2013.     In GBP,
EPS and HEPS are therefore expected to be between 0.16 pence and 0.35 pence.

The primary reasons for the decrease in EPS and HEPS are as follows:


Low grade mining cycle at Evander Gold Mines (Pty) Ltd (“Evander Mines”)

   The Group has previously communicated that Evander Mines is currently in a
   low grade mining cycle. This low grade mining cycle has impacted gold
   production and resulted in reduced profit margins and net profits generated
   by Evander Mines, in comparison to the previous corresponding reporting
   period.

   The low grade mining cycle at Evander Mines is expected to continue until
   February 2015, where after the operation should return to higher grade
   mining.   The operation is implementing measures to ensure that the impact
   of future lower grade mining cycles will be less pronounced.           These
   measures include advancing the lower section of the mine downwards from 25
   level to 26 level. In addition to increasing Evander Mines’ life of mine,
   this development will create additional stoping areas and therefore
   alleviate the mining flexibility constraints currently being experienced.
Section 54 notice of orders at both Barberton Mines (Pty) Ltd (“Barberton
Mines”) and Evander Mines

  On 21 November 2014 Pan African announced to shareholders that Section 54
  notice of orders were issued by the South African Department of Mineral
  Resources (“DMR”) to Barberton Mines and Evander Mines. These notices were
  issued after deviations were identified by the DMR’s Mine Health and Safety
  Inspectorate in respect of certain operating procedures and administrative
  processes pertaining to the mining operations’ lamp room, self-rescuers and
  gas monitors. The stoppages resulted in 5 days lost production at Barberton
  Mines and 3 days lost production at Evander Mines.

  The Group together with the operations’ Safety and Health Committees have
  since corrected the deviations and action plans were presented to the DMR.


Barberton Mines’ Biox® plant update

  As previously reported, Barberton Mines’ Biox® plant was subject to oil
  contamination from a breakdown at the Fairview primary crusher. This set-
  back continued to impact operations during the current six month reporting
  period, however the Biox® plant recoveries had improved to approximately 96%
  by December 2014 (historically recoveries have been between 96% and 97%).


Power supply interruptions

  During the interim reporting period ended 31 December 2014, the operations
  at both Barberton Mines and Evander Mines were impacted by power supply
  interruptions as a result of load shedding by the South African power
  utility, Eskom. The South African electricity supply is expected to remain
  constrained in the next year.


Update on the construction of the Evander Tailings Retreatment Plant (“ETRP”)

  The company is pleased to advise shareholders that the commissioning of the
  ETRP is on schedule and on budget, with 1st gold production expected during
  January 2015.   The ETRP is expected to add an additional 10,000oz of gold
  production per annum at Evander Mines.


The financial information contained in this trading statement has neither been
reviewed nor audited by the Company`s auditors. Pan African is currently
finalising its unaudited interim results for the period ended 31 December
2014, which is anticipated to be released on or about 27 February 2014.


For further information on Pan African, please visit the Company’s website at
www.panafricanresources.com

12 January 2015




Contact Details
Corporate Office
The Firs Office Building
1st Floor, Office 101
Cnr. Cradock and Biermann Avenues
Rosebank, Johannesburg
South Africa
Office:   + 27 (0) 11 243 2900
Facsmile: + 27 (0) 11 880 1240

Registered Office
Suite 31
Second Floor
107 Cheapside
London
EC2V 6DN
United Kingdom

Office:   + 44 (0) 207 796 8644
Facsmile: + 44 (0) 207 796 8645

Ron Holding                             Cobus Loots
Pan African Resources PLC               Pan African Resources PLC
Chief Executive Officer                 Financial Director
Office: + 27 (0)11 243 2900             Office: + 27 (0) 11 243 2900

Phil Dexter                             Neil Elliot/Peter Stewart
St James's Corporate Services Limited   Canaccord Genuity Limited
Company Secretary                       Nominated Adviser
Office: + 44 (0)207 796 8644            Office: +44 (0)207 523 8000

Sholto Simpson                          Matthew Armitt / Ross Allister
One Capital                             Peel Hunt LLP
JSE Sponsor                             Joint Broker
Office: + 27 (0)11 550 5009             Office: +44 (0)020 7418 8900

Julian Gwillim                          Daniel Thole
Aprio Strategic Communications          Bell Pottinger PR
Public & Investor Relations SA          Public & Investor Relations UK
Office: +27 (0)11 880 0037              Office: + 44 (0)203 772 2500



www.panafricanresources.com

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