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Reviewed Condensed Preliminary Consolidated Results for the Year Ended 30 June 2017
Bauba Platinum Limited
Reviewed condensed preliminary consolidated results for the year
ended 30 June 2017
www.bauba.co.za
Reviewed condensed preliminary consolidated statement of comprehensive income
for the year ended 30 June 2017
30 June 30 June
2017 2016
R'000 R'000
Revenue 205 318 78 743
Cost of sales (63 318) (29 191)
Gross profit 142 000 49 552
Other income 24 015 -
Bad debt recovery 10 392 -
Operating and administrative expenses (46 250) (53 961)
Finance income 3 987 1 061
Profit/(loss) before taxation 134 144 (3 348)
Income tax (38 615) (1 884)
Profit/(loss) for the year 95 529 (5 232)
Other comprehensive income - -
Comprehensive profit/(loss) for the year 95 529 (5 232)
Profit/(loss) attributable to:
Equity holders of the parent 55 756 (6 406)
Non-controlling interest 39 773 1 174
Comprehensive profit/(loss) attributable to:
Equity holders of the parent 55 756 (6 406)
Non-controlling interest 39 773 1 174
Basic profit/(loss) per share (cents) 14,71 (1,69)
Diluted profit/(loss) per share (cents) 14,65 (1,69)
Headline profit/(loss) per share (cents) 14,71 (1,69)
Diluted headline profit/(loss) per share (cents) 14,65 (1,69)
Reviewed condensed preliminary consolidated statement of financial position as
at 30 June 2017
30 June 30 June
2017 2016
Notes R'000 R'000
Assets
Non-current assets 170 231 171 410
Intangible assets 11 158 304 164 324
Property, plant and equipment 11 880 955
Deferred tax 47 6 131
Current assets 132 351 13 885
Inventory 8 064 -
Tax receivable - 476
Trade and other receivables 2 089 1 670
Cash and cash equivalents 122 198 11 739
Total assets 302 582 185 295
Equity and liabilities
Equity 270 940 174 934
Share capital and share premium 550 402 550 402
Reverse asset acquisition reserve (282 988) (282 988)
Share option reserve 477 -
Retained loss (39 040) (94 796)
Non-controlling interest 42 089 2 316
Non-current liabilities 3 388 5 552
Provision for rehabilitation 7 3 388 5 552
Current liabilities 28 254 4 809
Trade and other payables 20 876 1 052
Other financial liabilities 6 1 425 3 757
Provision for rehabilitation 7 4 870 -
Current tax payable 1 083 -
Total equity and liabilities 302 582 185 295
Reviewed condensed preliminary consolidated statement of cash flow
for the year ended 30 June 2017
30 June 30 June
2017 2016
R'000 R'000
Operating profit before working capital changes 140 909 6 258
Working capital changes 9 009 576
Taxation paid (30 972) (476)
Net cash effects from operating activities 118 946 6 358
Net cash effects from investing activities (8 487) (1 196)
Investments in intangible asset (872) (2 232)
Investments in property, plant and equipment (11 602) (25)
Interest received 3 987 1 061
Net cash effects from financing activities - (26 531)
Repayment of other financial liabilities – (26 531)
Total cash movement for the year 110 459 (21 369)
Cash and cash equivalents at the beginning of the
year 11 739 33 108
Cash and cash equivalents at the end of the year 122 198 11 739
Reviewed condensed preliminary consolidated statement of changes in equity for
the year ended 30 June 2017
Share Reverse
capital asset Non-
and acqui- Share Control-
share sition option Retained ling Total
premium reserve reserve loss interest equity
R'000 R'000 R'000 R'000 R'000 R'000
Balance at
1 July 2015 550 402 (282 988) - (88 390) 1 142 180 166
Total
comprehensive
loss for the year - - - (6 406) 1 174 (5 232)
Balance at 550 402 (282 988) - (94 796) 2 316 174 934
30 June 2016
Share-based
payment reserve
movement - - 477 - - 477
Total comprehensive
profit for the
year - - - 55 756 39 773 95 529
Balance at
30 June 2017 550 402 (282 988) 477 (39 040) 42 089 270 940
Notes to the reviewed condensed preliminary consolidated financial results for
the year ended 30 June 2017
1. Basis of preparation
These condensed consolidated financial results have been prepared by
Jonathan Knowlden CA(SA), the Financial Director, in accordance with IAS 34:
Interim Financial Reporting, the framework concepts and the measurement and
recognition requirements of International Financial Reporting Standards (IFRS)
as issued by the International Accounting Standards Board (IASB), SAICA
Financial Reporting Guides as issued by the Accounting Practices Committee,
the Financial Reporting Pronouncements as issued by the Financial Reporting
Standards Council, the requirements of the South African Companies Act, and
the Listings Requirements of the JSE Limited (JSE Listings Requirements).
The same accounting policies, presentation and measurement principles have
been followed in the preparation of the condensed report for the year ended
30 June 2017 as were applied in the preparation of the Group's annual
financial statements for the year ended 30 June 2016.
2. Financial review
Bauba's only operating mine, Moeijelijk, resumed mining activities in
January 2017 under a significantly improved chrome ore market. This improved
performance was therefore driven by six months of operations, while ramping
up to stable monthly open cast production. The chrome ore price dropped
significantly in May, but has since improved and is on an upward trend again.
The weighted average cost, insurance and freight (CIF) $ price realised for
the year was $237 for 38 - 40% Cr2O3 chrome ore run of mine with an average
Cr2O3 grade of 40,36%. These results demonstrate Moeijelijk’s cash generation
ability and future potential once the current underground mine development is
completed and the mine operates at stable monthly production for a full year,
drawing on both open cast and underground operations.
The Group reported profit before tax for the year ended 30 June 2017 of
R134,144 million (2016: loss of R3,348 million) and profit attributable to
equity holders of the parent of R55,756 million (2016: loss of R6,406 million)
resulting in diluted headline earnings per share of 14,65 cents
(2016: loss of 1,69 cents). The Group generated cash from operating activities
of R118,946 million (2016: R6,358 million) and ended the year with cash and
cash equivalents of R122,198 million (2016: R11,739 million).
R24,015 million of other income was recognised in the year under review arising
from the settlement of a contractual debt due to Bauba. In the 2016 annual
financial statements' Subsequent Events note, it was disclosed that an
approximate 17 300 tonnes (t) of a total 20 000 t of chrome ore supplied to a
debtor, who subsequently went into business rescue, was recovered and as a
result R10,392 million was recognised as a bad debt recovery in the current
year.
The increase in property, plant and equipment during the current year of
R10,925 million was mainly attributable to underground development capital
expenditure of R8,191 million. The decrease in deferred tax was mainly due to
the utilisation of the assessed loss in Bauba A Hlabirwa Mining Investments
Proprietary Limited and section 36 allowances on certain capital expenditure
in terms of the Income Tax Act. There was 18 801 t of inventory held at year
end (2016: nil) and trade and other payables increased R19,824 million with
both movements due to Moeijelijk resuming operations.
3. Outlook
Bauba is optimistic for the 2018 financial year considering the steadily
improving chrome ore prices from May's lows with current CIF pricing for our
product above $200 per tonne, but still with significant quantities of chrome
ore in China that must be cleared. Open cast production after the May crash
was decreased to preserve our resource for more favourable market conditions
and production is currently being increased again to capitalise on the recently
improved pricing. Our business model and low cost of production ensures that
we are able to operate sustainably in a stressed chrome ore market, if need be.
Due to additional safety measures implemented in securing the highwall face
where our underground portal is being constructed, stable underground LG6
chrome ore production of 30 000 t per month will only be achieved by the first
half of 2019 and not June 2018 as previously guided. A production rate of
20 000 t of underground LG6 chrome ore is expected to be achieved in June 2018,
with a total underground production forecast for the 2018 financial
year of 100 000 t.
Any forecast financial information contained in this announcement has not
been reviewed or reported on by Bauba's auditors.
4. Auditor's review conclusion
These condensed consolidated financial statements for the year ended 30 June
2017 have been reviewed by BDO South Africa Incorporated, who expressed an
unmodified conclusion. A copy of the auditor's review report is available for
inspection at the Company's registered office.
5. Distribution
A maiden distribution of 10,0 cents per share was declared after year end.
The source of the distribution will be from share premium and is considered
a return of contributed tax capital to shareholders recorded in the share
register of the Company at the close of business on Friday, 27 October 2017.
The Company has 379 020 249 ordinary shares in issue.
Its income tax reference number is 9475130713.
Shareholders are advised of the following salient dates in respect of
the distribution:
Last day to trade "cum" the distribution Tuesday, 24 October 2017
Shares trade "ex" the distribution Wednesday, 25 October 2017
Record date Friday, 27 October 2017
Payment to shareholders Monday, 30 October 2017
Share certificates may not be dematerialised or rematerialised between
Wednesday, 25 October 2017 and Friday, 27 October 2017, both days inclusive.
The distribution will be paid out of qualifying contributed tax capital in
terms of the Income Tax Act, and as such the distribution will be regarded
as a return of capital and may have potential capital gains tax consequences.
Shareholders are advised to consult their tax advisors regarding the impact
of the distribution.
6. Other financial liabilities
30 June 30 June
2017 2016
R'000 R'000
Royalty taxes - 2 849
The amount relates to royalty taxes
due according to the Mineral and Petroleum
Resources Royalty Act
Other 1 425 908
1 425 3 757
Current liabilities
At amortised cost 1 425 3 757
7. Provision for rehabilitation
30 June 30 June
2017 2016
R'000 R'000
Balance at the beginning of the year 5 552 2 520
Movement in provision during the year
recognised in profit or loss 2 706 3 032
Balance at the end of the year 8 258 5 552
Due within one year or less 4 870 -
Due after more than one year 3 388 5 552
Environmental obligations are based on the Group's environmental plans. Full
provision is made based on the net present value of the estimated cost of
restoring the environmental disturbance that has occurred up to the
reporting date.
8. Board
During the year under review, up to the date of this report, the following
changes were made to the board of directors of the Company:
Appointment
JA Knowlden (Financial Director) - 1 December 2016.
Resignation
CH Gernandt (Financial Director) - 1 December 2016.
9. Operating segments
Platinum Intragroup
Chrome Explora- Corpo- Elimina-
project tion rate tion Total
R'000 R'000 R'000 R'000 R'000
30 June 2017
Revenue 205 318 - 10 435 (10 435) 205 318
Profit before tax 131 359 - 2 785 - 134 144
Taxation (38 615) - - - (38 615)
Profit after tax 92 744 - 2 785 - 95 529
Interest received 1 913 - 2 074 - 3 987
Depreciation,
amortisation and
impairment (7 543) - (26) - (7 569)
Investment in 872 – - - 872
intangible assets
Total assets 249 058 20 161 45 036 (11 673) 302 582
Total liabilities (30 368) - (12 947) 11 673 (31 642)
30 June 2016
Revenue 78 743 - 4 707 (4 707) 78 743
Profit/(loss)
before tax 4 820 - (8 168) - (3 348)
Taxation (1 884) - - - (1 884)
Profit/(loss)
after tax 2 936 - (8 168) - (5 232)
Interest received - – 1 061 – 1 061
Depreciation,
amortisation and
impairment (7 605) – (27) - (7 632)
Investment in
intangible assets 2 232 – – – 2 232
Total assets 153 417 20 161 29 059 (17 342) 185 295
Total liabilities (27 472) - (231) 17 342 (10 361)
The Bauba Group segmental analysis is based on the Moeijelijk chrome project,
platinum exploration and corporate activities. The Group was reliant on one
major customer in respect of chrome ore sales.
10. Changes in share capital
There were no changes to the issued share capital during the year under review.
11 Intangible assets
Accumulated
amortisation
and Carrying
Cost impairments value
R'000 R'000 R'000
30 June 2017
Platinum mineral rights 30 555 (10 394) 20 161
Chrome mineral rights 154 714 (16 571) 138 143
Total mineral rights 185 269 (26 965) 158 304
30 June 2016
Platinum mineral rights 30 555 (10 394) 20 161
Chrome mineral rights 153 842 (9 679) 144 163
Total mineral rights 184 397 (20 073) 164 324
Opening Amorti- Closing
balance Additions tisation balance
R'000 R'000 R'000 R'000
Reconciliation
30 June 2017
Platinum mineral
rights 20 161 - - 20 161
Chrome mineral
rights 144 163 872 (6 892) 138 143
Total mineral
rights 164 324 872 (6 892) 158 304
30 June 2016
Platinum mineral
rights 20 161 - - 20 161
Chrome mineral
rights 149 204 2 232 (7 273) 144 163
Total mineral
rights 169 365 2 232 (7 273) 164 324
12. Earnings per share
30 June 30 June
2017 2016
R'000 R'000
Headline earnings reconciliation:
Profit/(loss) attributable to equity
holders of the parent 55 756 (6 406)
Loss on sale of property, plant and equipment - 3
Headline profit/(loss) 55 756 (6 403)
Basic profit/(loss) per share (cents) 14,71 (1,69)
Diluted profit/(loss) per share (cents) 14,65 (1,69)
Headline profit/(loss) per share (cents) 14,71 (1,69)
Diluted headline profit/(loss) per share (cents) 14,65 (1,69)
Number of shares in issue at the end of the year
(‘000) 379 020 379 020
Reconciliation of weighted average number of
shares to diluted weighted average number
of shares:
Weighted average number of shares ('000) 379 020 379 020
Dilutive effect of share options 1 563 -
Diluted weighted average number of shares ('000) 380 583 379 020
13. Fair value and financial instruments
The carrying value of all financial instruments approximates fair value.
All financial instruments are measured at amortised cost.
14. Subsequent events
The Directors are not aware of any significant matter or circumstance arising
since the end of the financial year, not otherwise dealt with in this report,
which significantly affect the financial position of the Group or the results
of its operations to the date of this report.
15. Going concern
Bauba has capitalised on the improved chrome ore prices and has generated
significant positive cash flows with a cash and cash equivalents balance of
R122,198 million and no interest-bearing borrowings at year end. The Group
has net current assets of R104,097 million and shareholder's equity of
R270,940 million at year end. The cash flow forecasts prepared by the
directors based on current available information, indicate the Company
will be able to meets its commitments within the next 12 months as they
fall due. The Company has sufficient resources to continue as a going
concern and has therefore concluded that it is appropriate to prepare
the financial statements on a going concern basis. Accordingly, the
financial statements do not include the adjustments that would result if
the Company was unable to continue as a going concern.
1 September 2017
Johannesburg
Corporate information
Bauba Platinum Limited:
Incorporated in the Republic of South Africa
(Registration number 1986/004649/06)
(Bauba or the Company or the Group)
JSE share code: BAU
ISIN: ZAE000145686
Postal address:
PO Box 1658, Witkoppen, 2068.
Tel no: +27 (011) 699 5720
Board of directors:
NPJ van der Hoven# (Chairman), M Luyt*, SM Dolamo*, Dr NM Phosa#, DS Smith*
King TV Thulare# (Alternate), NW van der Hoven, JA Knowlden
#Non-executive *Independent non-executive
Sponsor:
Merchantec Capital, 2nd Floor, North Block Hyde Park Office Tower Corner
6th Road and Jan Smuts Avenue, Hyde Park, Johannesburg, 2196
(PO Box 41480, Craighall, 2024)
Registered Office:
Cube Workspace, 1 Wedgewood Link, Bryanston, Johannesburg, 2191
South Africa
Company Secretary:
Merchantec Proprietary Limited
Transfer Secretaries:
Computershare Investor Services Proprietary Limited, Rosebank Towers,
15 Biermann Avenue, Rosebank, 2196 (PO Box 61051, Marshalltown, 2107)
Auditors:
BDO South Africa Incorporated, 22 Wellington Road, Parktown, 2193
Date: 01/09/2017 09:28:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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