HARARE: AQUARIUS Platinum’s quarterly financial and production results to end-March released on Tuesday production from operating mines was 6% higher than in the same period last year.
But quarter-on-quarter production fell 5% due to fewer working days, although group production for the year to date remains ahead of guidance, the miner said yesterday, in reporting a consolidated net loss after tax of $8m in the quarter.
The group said that platinum prices, after rising at the start of January, continued their recent downward trend — falling to their lowest level in more than five years, and ending the quarter at $1,141 an ounce, down 6%. Palladium prices ended 8% lower in the period, at $736/oz.
But Aquarius said cost increases at its Kroondal mine and its Zimbabwean mine Mimosa were kept below inflationary targets in the nine months ended March this year, compared with the same period last year. However, quarter-on-quarter costs rose for both mines — by 7% and 2%, respectively.
Aquarius shares the Kroondal mine in SA with Anglo American Platinum and the Mimosa mine in Zimbabwe with Impala Platinum. It said platinum producers in Zimbabwe continued to engage with Zimbabwe’s government over “resolving” a 15% royalty on the export of unrefined platinum, which was introduced in January.
Imara SP Reid analyst Sibonginkosi Nyanga said on Tuesday better production coupled with “excellent cost management” enabled Aquarius to generate positive operational cash flows, despite a fall in platinum group metals (PGMs) prices.
“It looks like Aquarius’ assets are cash generative at current prices,” he said. “This positive picture is partly offset by regulatory uncertainty in Zimbabwe with regard to indigenisation and the newly approved 15% tax on raw platinum exports.”
The average PGMs basket price fell 4% quarter on quarter in dollar terms, and was down 9% compared to the previous corresponding period. The rand had weakened 5% on average quarter on quarter, and 8% compared with the quarter last year. This saw the miner’s revenue slip 2% to $50m.
Jean Nel, Aquarius Platinum CEO, said despite the “challenging operating environment”, the group had recorded another “credible operating result”.
“Most importantly, both Kroondal and Mimosa delivered production ahead of guidance and managed to contain annualised cost increases well below inflation,” he said.
