Wrap Text
Financial and Production Results to 31 March 2015
Aquarius Platinum Limited
(Incorporated in Bermuda)
Registration Number: EC26290
ISIN Code: BMG0440M1284
JSE Share Code: AQP
Financial and Production Results to 31 March 2015
Highlights
- Attributable production for the quarter from operating mines was 84,792 PGM ounces – 6% higher compared
to the previous corresponding period ended March 2014 (pcp), quarter-on-quarter production decreased 5%
due to a shorter production quarter
- Group production for year to date remains ahead of guidance
- Cash costs increases at Kroondal remained below inflationary targets increasing 1% for the nine months ended
March 2015 compared to the nine months ended March 2014, although quarter-on-quarter costs increased
7%, driven by less production shifts and stock pile reduction over Christmas holidays
- Cash costs at Mimosa significantly lower, 8% for the nine months ended 31 March 2015 compared to the nine
months ended March 2014, while quarter-on-quarter costs increased 2%
- Average PGM basket price decreased 4% quarter-on-quarter in Dollar terms, down 9% compared to the pcp
- The Rand weakened against the US Dollar by 5% on average quarter-on-quarter – down 8% compared to pcp
- Revenue down 2% to $50 million (Q2 2015: $51 million) in line with lower production and low prices
- Mine EBITDA marginally up at $4.4 million (Q2 2015: $3.6 million), down $6.7 million compared to pcp due to a
$6 million negative sales adjustment caused by lower PGM prices
- Attributable cash balance increased by $2 million during the quarter to $174 million (of which $13 million is
held in JV entities)
Q3 2015 Operating Results Summary
Kroondal Mimosa Platinum Mile
4E PGM Production
Total (100% basis) 107,089 57,391 2,552
Attributable 53,544 28,696 2,552
4E Basket Price
R/oz 12,446 12,187
$/oz 1,062 1,036 1,039
Cash Costs (4E basis)
R/oz 9,560 9,327
$/oz 815 799 795
Cash Margin (%) 6 21 3
Stay-in-Business Capex
R/oz 698 0
$/oz 90 119 0
Commenting on the results, Jean Nel, CEO Aquarius Platinum said:
Despite the challenging operating and macro environment, Aquarius recorded another credible operating result
and made progress on a number of strategic initiatives during the quarter. Most importantly both Kroondal and
Mimosa delivered production ahead of guidance and managed to contain annualised cost increases well below
inflation, whilst continuing to improve its longer term safety record.
Kroondal delivered a record 9th consecutive quarter of PGM production in excess of 105,000 ounces with
annualised cost increases well below inflation, a credible result that could have been much better had it not
been for the 113,000 tonnes of lost production (valued at R73 million) due to six Section 54 stoppages imposed
on Kroondal by the DMR in the quarter.
In Zimbabwe, Mimosa’s strong production record continued uninterrupted while costs were maintained below
$800 PGM ounce for the second consecutive quarter.
The combined operational efforts at Kroondal and Mimosa contributed to the company increasing its cash levels
slightly to $174 million on an attributable basis, despite the Dollar metal basket price reducing during the
quarter by 4%.
During the quarter work on fulfilling the conditions precedent to the sale of the Everest mine to Northam, first
announced on 10 February 2015, also continued and Part A of the sale become unconditional on 22 April 2015
with the result that Aquarius is entitled to receive the Part A proceeds of R400 million on 26 June 2015.
A critical work stream during the quarter entailed the three platinum producers in Zimbabwe continuing their
engagement with the Government of Zimbabwe aimed at resolving the 15% royalty on the export of unrefined
platinum which was introduced in January 2015. Although not yet resolved Aquarius is satisfied with progress
made to date and remain optimistic that the matter will be resolved in due course.
Management’s focus in the short term will remain consistently on maintaining safety, production and cost
discipline, a view informed by our assessment that at a macro level there is little suggesting that Dollar metal
prices may strengthen materially in the short term.
Production by mine
Quarter ended
PGMs (4E)
Mar 2015 Dec 2014 % Change Mar 2014 % Change
Kroondal 107,089 111,115 (4) 107,818 (1)
Mimosa 57,391 60,842 (6) 51,907 11
Platinum Mile 2,552 2,996 (15) 289 783
Total 167,032 174,953 (5) 160,014 4
Production by mine attributable to Aquarius (Operating mines)
Quarter ended
PGMs (4E)
Mar 2015 Dec 2014 % Change Mar 2014 % Change
Kroondal 53,544 55,557 (4) 53,909 (1)
Mimosa 28,696 30,421 (6) 25,954 11
Platinum Mile 2,552 2,996 (15) 289 783
Total 84,792 88,974 (5) 80,152 6
Aquarius Group quarterly attributable production (PGM ounces) to 31 March 2015
Please refer to www.aquariusplatinum.com for the graph.
Market Summary
After an initial rise at the start of January, the price of platinum continued its recent downward trend falling to
its lowest level in over 5 years, ending the quarter at $1,141 per ounce (down 6%). Palladium also struggled
across the quarter, weighed down by a weak end to March which saw the metal finish 8% lower over the period
closing at $736 per ounce.
More recently, Platinum imports into China fell by 58% year on year to 91.2koz across the last week of March,
the weakest since November 2008, impacted in particular by a lack of demand for jewellery from China. Given
the weakness in China’s recent trade data and the weak volumes on the Shanghai Gold Exchange, the near term
looks uncertain for platinum, but in the longer term demand outside of the jewellery sector should provide
support for prices. Gold prices finished the quarter marginally higher after rallying throughout January to highs
of $1,300 per ounce, however a sharp fall in February saw the metal close only 0.2% higher over the quarter at
$1,184 per ounce.
Palladium along with the rest of the PGM complex suffered as evident from the latest weekly import data -
Palladium imports fell 54% year on year to 33.2koz in the last week of March, the lowest since January 2009.
Palladium imports have trended lower since the middle of last year as auto sales growth slowed, falling 0.2% in
February year on year, declining for the first time since February 2013. The precious metal did however form a
small rally during the period climbing to $829 per ounce by early March, however this was not sustained moving
back into negative territory.
The average Rand-Dollar exchange rate weakened during the quarter by 5% from R11.53 to R12.14. Since then,
the Rand has weakened further 1% in the first two weeks of April, and trending around a level of R12.2.
12-month individual PGM prices to March 2015
Please refer to www.aquariusplatinum.com for the graph.
12-month PGM basket prices to March 2015
Please refer to www.aquariusplatinum.com for the graph.
12-month Rand-Dollar exchange rate to March 2015
Please refer to www.aquariusplatinum.com for the graph.
Average PGM basket prices achieved at Aquarius operations
US$ per PGM Quarter ended
ounce (4E) Mar 2015 Dec 2014 % Change Mar 2014 % Change
Kroondal 1,062 1,090 (3) 1,179 (10)
Mimosa 1,036 1,100 (7) 1,112 (7)
Platinum Mile 1,039 1,090 (5) 1,179 (12)
Weighted 1,053 1,097 (4) 1,157 (9)
Financials
Aquarius recorded an on-mine EBITDA profit of $4.4 million from controlled entities for the quarter ended 31
March 2015, marginally higher compared to the December 2014 quarter. This was despite a 5% reduction in
production in the March quarter, a shorter production quarter due to the seasonal holidays. Compared to the
pcp (March 2014) EBITDA was adversely impacted by $6 million adverse negative sales adjustments. The result
reflects the material impact price decreases have on cash flows and results in the present low PGM price
environment. Aquarius recorded a consolidated accounting net loss after tax (IFRS) of $8 million for the quarter.
Profit & Production Summary
March 2015 Quarter Aquarius JV entities Total Consolidation Aquarius
operations adjustment Group
Mine EBITDA $4.4M $8M $12.4M ($8M) $4.4M
Revenue $50.2M $32M $82.2M ($32M) $50.2M
Cost of sales ($51.2M) ($29M) ($80.2M) $29M ($51.2M)
Net profit/(loss) after tax ($6.3M) ($1.8M) ($8.1M) - ($8.1M)
PGM ozs production 56,096 28,696 84,792 - 84,792
Revenue was 2% lower quarter on quarter on lower production (due to a shorter production quarter) and lower
prices. Compared to the pcp, revenue was $10 million lower despite an increase in production due to $6 million
adverse sales adjustments caused by decreasing prices. In Rand terms, PGM prices were 1% lower compared to
the pcp and 9% lower in Dollar terms due to a weaker Rand which depreciated 8% compared to the pcp.
Group production for the quarter was 6% higher compared to the pcp and remains within guidance for the year.
On a quarter on quarter comparison, production was 5% lower due to the March quarter having less working
days due to seasonal holidays. The Kroondal mine continued to excel maintaining production in excess of
105,000 PGM ounces (50% attributable to Aquarius) by drawing from stockpile to mitigate lower production
shifts due to the Christmas holiday period. Production at joint venture entity Mimosa remained strong up 10%
compared to the pcp. Production at PlatMile which resumed in July 2014 and yet to achieve steady state
production was down 15% in the quarter because of planned maintenance.
Total cost of sales of $51 million was 7% lower compared to the pcp, despite a 6% increase in production, due to
a 8% weakening in the Rand/Dollar exchange rate. In Rand terms, total cost of sales was 1% higher compared to
the pcp.
Kroondal's unit costs for the nine months to 31 March 2015 remain within inflationary targets having increased
1% compared to the pcp. For the quarter under review, Kroondal's cash costs per ounce in Rand terms increased
7% quarter on quarter but only 2% in Dollar terms due to the weaker Rand. This increase in costs was driven
primarily by lower production than the record December quarter, resulting in (as previously guided) increase in
reportable cash costs from the treatment of the ore stock pile during the December Christmas break. The good
production performance at Kroondal was achieved notwithstanding the mine encountering a number of
operational challenges.
Mimosa's unit costs of $799 per PGM ounce for the nine months to 31 March 2015 were 8% lower compared to
the pcp in line with efficiency initiatives introduced during the financial year. For the quarter under review, cash
costs per PGM ounce were $799, a 2% increase quarter on quarter. The 2% increase in unit costs was due to
reduced PGM production (6%) as a result of planned plant maintenance and a shorter production quarter due to
the Christmas holidays. These challenges notwithstanding Mimosa’s production levels continue to exceed
company guidance.
Administrative costs of $1.4 million (of which $0.2 million was non-cash) are in line with previous quarters,
maintaining cost reduction initiatives previously implemented. Depreciation and amortisation for the quarter of
$4.7 million was lower due to an increased resource base resulting from the extension of Kroondal’s mine life, as
previously announced. Finance costs include interest paid on borrowings of $1.4 million, non-cash interest
accretion on convertible bonds of $1.2 million and the unwinding of the rehabilitation provision of $1.1 million.
Finance costs for the quarter were 46% lower compared to the pcp following the $172.6 million bond buy back
in May 2014.
Net operating cash outflow for the quarter of $4 million comprised $52 million inflow from sales, $58 million
paid to suppliers and $2 million interest received. Development and capital expenditure for the quarter was $5
million. Net financing cash inflows of $8 million related to proceeds from AQPSA finance leases.
The Group’s cash balance of $161 million at the end of the quarter was held as follows:
AQP $108 million
AQPSA $48 million
ASACS $1 million
Platmile $2 million
Ridge Mining $2 million
Total $161 million*
* Mimosa and Blue Ridge (in which Aquarius has a 50% equity interest) are accounted for using the equity
method. Cash held in these two entities at 31 March 2015 was $26 million and does not form part of the above
cash balances. Under the previous method of proportionately consolidating its investment in Mimosa and Blue
Ridge, 50% of this cash ($13 million) would have been included in Aquarius' Group cash balance.
Joint venture entities
Mimosa
Mimosa recorded an EBITDA profit attributable to Aquarius of $8 million and a net profit before tax of $1.8
million for the quarter. The result was achieved on production of 28,696 PGM ounces attributable to Aquarius.
Mimosa is in discussions with the authorities to have royalties deemed deductible for tax purposes. The tax
liability relating to the non- deductibility of royalties as at March 2015 (on a 100% basis) was $7.7m ($4.2m prior
year and $3.5m current year). The liability has been accrued in the financials awaiting the finalisation of
negotiations with the authorities and any legislative amendments.
Cash held in Mimosa at 31 March 2015 was $25 million (100%).
Blue Ridge and Sheba’s Ridge
Blue Ridge and Sheba’s Ridge recorded a net loss after tax of $0.2 million for the quarter representing care and
maintenance costs incurred.
(The segment note provided on page 10 details the income statement for each operating division of the
Aquarius Group.)
Consolidated Income Statement
Quarter ended 31 March 2015
$’000
Quarter Ended Nine months Financial Year
Ended Ended
Note 31/03/15* 31/03/15* 30/06/14
PGM production – Kroondal & Platmile 56,096 172,607 220,961
PGM production – Mimosa 28,696 88,016 110,681
Total PGM production 84,792 260,623 331,642
Revenue (i) 50,241 163,504 233,056
Cost of sales (including D&A) (ii) (51,203) (160,929) (231,158)
Gross profit/(loss) (962) 2,575 1,898
Other income 41 151 174
Administrative costs (iii) (1,417) (4,655) (7,353)
Foreign exchange gain/(loss) (iv) 164 (239) 1,843
Finance costs (v) (3,783) (11,597) (28,091)
Impairment losses (253) (827) (3,084)
Profit on repurchase of bonds - - 10,925
Profit on sale of assets 13 1,139 653
Closure, transition and rehabilitation reversal/(cost) - - 5,342
Share of (loss)/profit from joint venture entities (vi) (1,783) (50,970) 5,055
Loss before income tax (7,980) (64,423) (12,638)
Income tax expense (vii) (122) (415) (544)
Net loss (8,102) (64,838) (13,182)
Net loss is attributable to:
Equity holders of Aquarius Platinum Limited (8,069) (64,900) (13,048)
Non-controlling interests (viii) (33) 62 (134)
(8,102) (64,838) (13,182)
Earnings per share
Basic loss per share (cps) (0.49) (4.42) (1.38)
* Unaudited
Notes on the March 2015 Consolidated Income Statement
(i) Revenue for the quarter of $50 million was 2% lower than the previous quarter due to lower production
and $2 million negative sales adjustments
(ii) Cost of sales of $51 million for the quarter was 4% lower in line with lower production (down 5%) compared
to the previous quarter December 2014
(iii) Administrative costs for the quarter of $1.4 million are in line with previous periods in the current financial
year. Costs for the nine months ended March 2015 includes $0.6 million of non-cash expenses
(iv) The foreign exchange gain is attributable to revaluation adjustments on cash balances held in Rand,
Australian Dollars and Pound Stirling, and the revaluation of pipeline debtors in line with movements in the Rand
against the US Dollar
(v) Finance costs include interest paid on borrowings of $1.4 million, non-cash interest accretion on convertible
bonds of $1.2 million and the unwinding of the rehabilitation provision of $1.1 million
(vi) Represents share of (loss)/profit of Mimosa and Blue Ridge, the joint venture entities. Cumulative share of
(loss)/profit from joint venture entities comprises operating profit of $4 million offset by impairment of Blue
Ridge/Sheba's Ridge of $26 million and discounting of the RBZ receivable of $28.5 million. An accrual of $3.8 million
has been taken up for income tax payable pending conclusion of discussions with the authorities on the tax
deductibility of mine royalties.
(vii) Income tax expense consists of AQPSA deferred tax and royalties
(viii) Non-controlling interests reflect the 8.3% non-controlling interest of Platinum Mile Resources (Pty) Ltd
Consolidated Statement of Cash Flows
Quarter ended 31 March 2015
$’000
Quarter Nine months Financial Year
Ended ended Ended
Note 31/03/15* 31/03/15* 30/06/14
Net operating cash (outflow)/inflow (i) (4,075) 1,948 21,092
Net investing cash (outflow)/inflow (ii) (4,870) 9,885 (27,224)
Net financing cash inflow (iii) 8,393 22,009 62,271
Net decrease/(increase) in cash held (552) 33,842 56,139
Opening cash balance 164,211 136,820 77,773
Exchange rate movement on cash (3,040) (10,043) 2,908
Closing cash balance (iv) 160,619 160,619 136,820
* Unaudited
Notes on the March 2015 Consolidated Statement of Cash Flows
(i) Net operating cash flow for the quarter includes $52 million inflow from sales, $58 million paid to suppliers and
$2 million interest received
(ii) Comprises $5 million of development and plant & equipment expenditure at AQPSA
(iii) Consists of proceeds from AQPSA finance leases
(iv) Mimosa and Blue Ridge (in which Aquarius has a 50% equity interest) are accounted for using the equity
method
(v) Cash held in these two entities at 31 March 2015 was $26 million and does not form part of the above cash
balances. Under the previous method of proportionately consolidating its investment in Mimosa and Blue Ridge,
50% of this cash would have been included in the Aquarius' Group cash balance
Consolidated Balance Sheet
At 31 March 2015
$’000
Note As at As at
31/03/15* 30/06/14
Assets
Cash and cash equivalents 160,619 136,820
Current receivables (i) 29,125 30,104
Other current assets (ii) 12,505 15,246
Investments in joint venture entities (iii) 151,633 230,410
Mining assets (iv) 191,310 209,211
Intangible asset (v) 46,799 54,499
Other non-current assets (vi) 40,450 41,185
Total assets 632,441 717,475
Liabilities
Current liabilities (vii) 157,354 40,123
Non-current interest-bearing liabilities (viii) 1,651 118,919
Other non-current liabilities (ix) 78,762 84,665
Total liabilities 237,767 243,707
Net assets 394,674 473,768
Equity
Issued capital 75,134 73,216
Treasury shares (25,872) (26,239)
Reserves 765,053 781,692
Accumulated losses (425,350) (360,450)
Total equity attributable to equity holders of
Aquarius Platinum Limited 388,965 468,219
Non-controlling interests (x) 5,709 5,549
Total equity 394,674 473,768
* Unaudited
Notes on the March 2015 Consolidated Balance Sheet
(i) Reflects debtors receivable on PGM concentrate sales
(ii) Reflects PGM concentrate inventory, consumables, stores and critical spares
(iii) Represents the investment in Mimosa, Blue Ridge and Sheba’s Ridge. Reduction in investments in joint venture
entities reflects impairment of Blue Ridge/Sheba's Ridge of $26 million and discounting of the RBZ receivable of
$28.5 million as reported in December 2014.
(iv) Includes Group mining assets at Kroondal, Marikana, Everest, CTRP and Platmile
(v) Includes intangibles relating to contract value acquired on the acquisition of equity interest in Platinum Mile
Resources (Pty) Ltd
(vi) Includes the recoverable portion of the rehabilitation provision from Anglo Platinum of $9 million, carrying
amount of receivable from Blue Ridge $5 million, investments in rehabilitation trusts of $14 million and deferred
tax assets of $12 million
(vii) Includes convertible bonds of $121 million, trade creditors of $27 million, AQPSA finance leases of $2 million,
tax payable of $3 million and annual leave provision of $4 million
(viii) Comprises AQPSA equipment leases of $2 million
(ix) Includes deferred tax liabilities of $16 million, provision for closure costs of $61 million and other payables $2
million
(x) Reflects the 8.3% non-controlling interest of Platinum Mile Resources (Pty) Ltd
Segment Note
Quarter ended 31 March 2015
$’000
Kroondal Marikana Everest Mimosa Plat Mile CTRP Blue Ridge Corporate/ Segment Reconciliation Consolidated
Unallocated Result to Consolidated
Information
Revenue 46,895 53 23 31,959 2,007 17 9 1,246 82,209 (31,968) 50,241
Cost of sales
- mining, processing and administration (43,640) (287) (553) (23,557) (2,024) (4) (183) - (70,248) 23,740 (46,508)
- depreciation and amortisation (4,934) (13) 950 (5,258) (648) (47) - (3) (9,953) 5,258 (4,695)
Gross profit/(loss) (1,679) (247) 420 3,144 (665) (34) (174) 1,243 2,008 (2,970) (962)
Other income - - (329) - - 4 37 (288) 329 41
Administrative costs - - - - - - - (1,446) (1,446) 29 (1,417)
Foreign exchange gain/(loss) 2,316 - - (4) 110 - - (2,259) 163 1 164
Finance costs - - - - - - - (4,691) (4,691) 908 (3,783)
Impairment losses - - - - - - - (253) (253) - (253)
Profit on sale of assets - - - - - - - 13 13 - 13
Community share ownership trust - - - (1,050) - - - - (1,050) 1,050 -
Share of loss from joint venture entities - - - - - - - - - (1,783) (1,783)
Profit/(loss) before income tax 637 (247) 420 1,761 (555) (34) (170) (7,356) (5,544) (2,436) (7,980)
Income tax (expense)/benefit - - - - - - - (2,558) (2,558) 2,436 (122)
Net profit/(loss) from ordinary activities 637 (247) 420 1,761 (555) (34) (170) (9,914) (8,102) - (8,102)
On-mine EBITDA 5,180 (266) (534) 7,996 79 (4) (179) - 12,272 (7,825) 4,447
Income tax expense for the nine months to March 2015 includes a $1.8m accrual for non-deductibility of royalties at Mimosa.
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 per 200,000 man hours deteriorated slightly to 0.65 from 0,62
- Production decreased to 1,576,000 tonnes from 1,807,000 tonnes predominantly due to section 54
stoppages and the less production shifts due to the year-end holidays
- Head grade improved from 2.41 g/t to 2.46 g/t
- Recoveries improved by 1% to 80%
- Volumes processed decreased to 1,688,000 tonnes, down 7% quarter-on-quarter
- Stockpiles at the end of the quarter totalled approximately 47,000 tonnes, down 113,000 tonnes
- PGM production decreased by 4% to 107,089 PGM ounces
- Revenue increased by 4% to R1,093 million quarter-on-quarter due to weakening of the exchange rate
- Mining cash costs increased by 11% to R606 per tonne, due to lower volumes and stock pile milling during
the Christmas holidays. Unit cost per PGM ounce only increased by 7% to R9,560 per PGM ounce due to
improved quality
- Kroondal’s cash margin for the period increased from 5% to 6% due to an improved Rand basket price
Kroondal: Production, Cash Cost and Price Analysis
Please refer to www.aquariusplatinum.com for the graph.
Commentary
There were no fatalities during the quarter. The number of injuries decreased from 29 to 16 quarter on quarter
and the 12 Rolling DIIR Rate deteriorated from 0.62 to 0.65. The deterioration in safety took place despite a
focused safety campaign throughout the quarter. Safety campaigns were re-energised in January 2015. During
the quarter, six Section 54 instructions were issued resulting in approximately 113,000 tonnes of lost production.
Tonnes mined for the quarter was 13% lower at 1,676,000 tonnes due primarily to the six Section 54 instructions
issued by the DMR. In spite of these factors, Kroondal achieved its ninth consecutive +105,000 PGM production
quarter.
Operations at K6 Shaft remained challenging due to poor ground which necessitated rehabilitation in order to
get the belt infrastructure installed as well as high incidence of poor ground conditions in the stoping panels.
Kwezi shaft experienced poor ground conditions which resulted in all ends being reduced for safety. Simunye
shaft replaced part of its old generation fleet load haul dumpers, as well as engineering organisational changes.
Efficiencies continue to be pursued with the critical focus being the management of the TMM fleet. Bambanani
is scheduled to have its chairlift commissioned in Q4 in order to reduce face time lost due to long travelling to
the working places. Kopaneng shaft experienced some poor ground challenges in the decline as well as the
western part of the mine, which resulted in some ventilation challenges.
Various trials to mitigate the treating of iron-rich ultramafic pegmatite (IRUP) ore being mined at Kwezi has
resulted in potential solutions comprising blending the material, changing reagents and increasing the floatation
retention time in the process plants. Recoveries improved by 1% quarter on quarter. Further work will continue
in Q4 2015.
A recognition agreement was concluded with AMCU in January 2015, negotiations of which were conducted in a
cordial manner.
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 remains subject to the conclusion of a sale contract.
The conditions precedent to Part A of the sale agreement were fulfilled on 22 April 2015 which results in
Aquarius being entitled to the Part A proceeds of R400 million by 26 June 2015. The fulfilment of the additional
condition required to render Part B unconditional, being Section 11 approval by the DMR, is expected to
materialise before the end of the 2015 calendar year following which Aquarius would be entitled to a further
R50 million.
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 9,560 7,835 7,642
Capital expenditure
Kroondal
(R’000 unless otherwise stated) Total Per 4E oz
Ongoing establishment of infrastructure 69,854 652
Project capital (K6 shaft) 4,853 45
Mobile equipment 40,866 382
Total 115,573 1,079
Kroondal mine: reconciliation of cash costs per 4E ounce
Cost per 4E ounce
(Rand)
Q2 2015 Q3 2015
Total operating expenditure 10,213 10,106
Less:
Ongoing capital expenditure & mobile
equipment (1,195) (1,034)
Project capex (K6 shaft) (59) (45)
Transferred (to)/from stockpile (34) 533
On mine cash costs 8,925 9,560
MIMOSA INVESTMENTS (Aquarius Platinum - 50%)
Mimosa Platinum Mine
- 12-month rolling average DIIR was constant at 0.05 per 200,000 man hours worked
- Production decreased by 8% to 610,929 tonnes as result of lower operating days (82 days) in the third
quarter compared to 88 days worked in the 2nd quarter. This was due to 4 public holidays in the third
quarter as well as a shorter February month (2 days less)
- Head grade improved slightly to 3.65 g/t
- Recoveries improved to 78.7% from 78.3% in the second quarter
- Volumes processed deteriorated by 7% to 621,586 tonnes as result of lower milling days (81 days) in the
third quarter compared to 84 days worked in the 2nd quarter. The milling days were affected by a shorter
February month as well as planned maintenance shut downs in the third quarter
- Stockpile at the end of the quarter was approximately 170,600 tonnes
- PGM production deteriorated by 6% to 57,391 PGM ounces in line with reduced milled volumes as
explained above
- Revenue was the same as the previous quarter
- Mining cash costs per tonne increased to $75 in line with reduced milled tonnage as explained above
- Stay-in-business capital expenditure was $119 per PGM ounce for the quarter
Mimosa: Production, Cash Cost and Price Analysis
Please refer to www.aquariusplatinum.com for the graph.
Commentary
Safety, Health and Environment
No fatalities or LTIs occurred at Mimosa during the quarter.
Operations
The Mimosa mine operated very well during the quarter, enjoying cordial industrial relations and meeting most
of its production targets. Mimosa continues to implement cost containment initiatives and have managed to
operate within budget.
Regulatory and fiscal environment
As reported in the previous quarter, the following regulatory issues have a significant bearing on the operations
of the mine:
Indigenisation
Mimosa continues to interact with the Ministry of Indigenization and Ministry of Mines to work towards a
sustainable solution.
15% Export Levy on un-beneficiated PGMs
Discussions with the authorities continued during the quarter to find a way forward with regards to this issue.
The company has not yet made provision for this levy in the financials. If the levy were to be implemented, it
would have a significant impact on the financial position of the company.
Royalties
The company is continuing engagements with the authorities to have royalties deductible for tax purposes. The
tax liability relating to the non-deductibility of royalties as at March 2015 (on a 100% basis) was $7.7m ($4.2 m
prior year and $3.5m current year). The liability has been accrued in the financials awaiting the finalisation of
negotiations with the authorities and any legislative amendments.
Operating cash costs per ounce
Unit cash cost per PGM ounce (before by-product credits) was 2% higher compared to the previous quarter
mainly as a result of decreased production.
Mimosa 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)
Mimosa 799 754 566
Capital expenditure
The total capital expenditure for the second quarter amounted to $7 million. 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 9% to 1.2 million tonnes
- Head grade increased to 0.59 g/t from 0.55 – quarter on quarter
- Recoveries decreased to 12%, down from 13% quarter on quarter
- Production decreased to 2,552 PGM ounces as explained below
- Cash costs increased to R9,327 per PGM ounce
- Revenue was lower at R25 million for the quarter
- Cash margin for the quarter was 3%, down from 14% in the previous quarter
Commentary
Platinum Mile
The results for the quarter were lower than those of the previous quarter because of planned maintenance
resulting in operational downtime. Anglo Platinum has as yet not started their tailings re-treatment operations
and therefore the opportunity was utilised to do critical maintenance. It is anticipated that the Anglo
Platinum tailings project should increase feed volumes by some 275,000 tonnes of Merensky tailings material
per month. Once full production ramp-up is achieved the operation should increase production substantially in
relative terms.
Platinum Mile: 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 9,327 7,851 7,311
Chromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum - 50%)
There has been no change to the CTRP operations which remain on care and maintenance until further notice.
CORPORATE MATTERS
Everest Sale (announcement date 10 February 2015 / 3 March 2015)
As announced on 23 April 2015 the conditions precedent in respect of the Part A disposal process of the sale of
Everest were fulfilled on 22 April 2015. Part A of the disposal process is now unconditional and the consideration
of R400 million is due and payable by Northam on 26 June 2015.
Part B of the disposal process is subject to the consent of the Minister of Mineral Resources in terms of section
11 of the Mineral and Petroleum Resources Development Act. The section 11 application has been submitted to
the Department of Mineral Resources.
Should the Ministerial Consent not be obtained the first part of the Disposal will not be unwound.
Zimbabwe Royalty Update
As previously announced, in 2013 the Government of Zimbabwe proposed an export tax on unrefined platinum,
with a view to encouraging platinum mining companies to invest in smelting and refining capacity in Zimbabwe.
This export tax, at a rate of 15% of revenue, was deferred to take effect from 1 January 2015. In the 2015
National Budget statement made in December 2014, the Minister of Finance announced that the Government
had deferred the export tax on un-beneficiated platinum until 1 January 2017. However, the 2015 Finance Bill,
which was gazetted on 9 January 2015, does not provide for the deferral of the tax. The platinum mining
companies, represented by the Chamber of Mines, are in the process of engagement with the Government of
Zimbabwe to resolve the matter. Although the matter has not yet been resolved substantial progress was made
during the quarter and Aquarius and Mimosa are hopeful that the matter will be resolved in due course.
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
Sir Nigel Rudd 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)
Tim Freshwater
Edward Haslam
Kofi Morna
Sir Nigel Rudd
Remuneration Committee
Edward Haslam (Chairman)
David Dix
Zwelakhe Mankazana
Sir Nigel Rudd
Nomination Committee
Sonja De Bruyn Sebotsa (Chairman)
Tim Freshwater
Edward Haslam
Kofi Morna
Willi Boehm
Chief Operating Officer
Robert Schroder
Company Secretary
Willi Boehm
AQPSA Management
Robert Schroder Managing Director
Jean Nel Executive Director
Benjamin Gaseemelwe Acting General Manager: Kroondal
Mimosa Mine Management
Winston Chitando Chairman
Peter Chimboza Resident Director
Fungai Makoni Managing Director
Platinum Mile Management
Richard Atkinson Managing Director
Paul Swart Financial Director
Issued Capital
At 31 March 2015, the Company had on issue: 1,502,695,183 fully paid common shares.
Substantial Shareholders 31 March 2015 Number of Shares Percentage
HSBC Custody Nominees (Australia) Limited 107,881,143 7.18
JP Morgan Nominees Australia Limited 55,479,748 3.69
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) Broker (ASX) Sponsor (JSE)
Barclays Euroz Securities Rand Merchant Bank
5 The North Colonnade Level 18 Alluvion (A division of FirstRand Bank
Canary Wharf 58 Mounts Bay Road, Limited)
London E14 4BB Perth WA 6000 1 Merchant Place
Tel: +44 (0) 20 7623 2323 Telephone: +61 (0) 8 9488 1400 Cnr of Rivonia Rd and Fredman
Telephone: +44 (0)20 7628 1000 Drive, Sandton 2196
Johannesburg, South Africa
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 1, Suite 6, South Point, 100 Mill Point Road, 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
28 April 2015
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
Date: 28/04/2015 08:00:00 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
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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.
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