| Mon 7 Dec 2009, 11:17 | | MTX - Metorex - Chairman`s Statement - Annual General Meeting: December 7th 2009 |
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MTX
MEMTX
MTX - Metorex - Chairman`s Statement - Annual General Meeting: December 7th 2009
METOREX LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1934/005478/06)
JSE code: MTX
ISIN: ZAE000022745
Issuer code: MEMTX
("Metorex")
Chairman`s Statement - Annual General Meeting: December 7th 2009
Metorex Shareholders, Ladies and Gentleman,
Your attention is drawn to the 2009 Annual Report and the notice of today`s
annual general meeting contained therein. I would remind all present that the
company is currently trading under a cautionary.
Your company commenced the past year fighting for its very survival. With
substantial group debt and the Ruashi project finance in default, the important
Ruashi project far from completed and commissioning and production ramp up at an
early stage and amidst a sharp worldwide recession affecting commodity prices
across group operations, immediate and definitive corrective action was
required. This action was taken.
Your company now has a balanced, transformed and experienced new board with
improved governance and substantially new and talented executive teams at both
group and operational levels. The company strategy has been sharply repositioned
and refocused and, primarily via asset sales amounting to in excess of R900
mill, the balance sheet has been improved.
This process includes the sale of Vergenoeg Mining Company which sale will be
subject to shareholder approval at an Extraordinary General Meeting to be held
on 21 December 2009. A circular in this regard has been sent to shareholders on
4 December. An outstanding objective is the sale or closure, by no later than
February 2010, of Consolidated Murchison, which operation is non-core to the
refocused group strategy. We remain hopeful that a solution to save the mine and
its associated community will be found.
Critically, the process of restoring the company`s reputation for operational
and technical excellence is well advanced and all operations have made steady
and consistent progress throughout the financial year and to date. Safety,
health and environmental standards and practices have dramatically improved and
the core operational focus on volumes, value, quality, costs and capital have
all yielded results leading to improved profitability.
Your company has this year also improved its transparency, and thus hopefully
its credibility, by providing detailed quarterly operational and general updates
and consistently meeting or exceeding forecasts made for each forthcoming
quarter. We are looking forward to publishing our December quarterly report and
to continue to deliver against market expectations.
We are now entering the last phase of the rebirth of Metorex and are doing so
off the solid foundations of a competent and determined executive team, group
operations increasingly performing to specification and improving commodity
prices. The negative hedge profile, which Metorex had to enter into to secure
debt funding during 2008, has a limited period to run out which, combined with
the commodity prices and the disposal of Vergenoeg and further management
action, will enable Metorex to soon complete the restoration of its balance
sheet and to position the company to recommence growth in the period ahead.
Fortunately Metorex has a stellar new project pipeline. Kinsenda, Musonoi and
Lubembe, all located near the Zambian border in the Katanga province of the
Democratic Republic of the Congo ("DRC"), are all world class assets. Together
with Chibuluma and Ruashi these will form the initial base for our renewed value
creation for our shareholders and enable Metorex to reach its immediate medium
term target of producing 120,000 tons of copper per annum.
It bears mentioning that Metorex is the only significant South African company
on the Copper Belt, that Chibuluma in Zambia is a model underground sulphide ore
copper mine and that Ruashi is now the state-of-the-art SX-EX oxide ore
copper/cobalt mining operation in the DRC. Your company has now made material
progress in developing the depth of operational expertise and intellectual
capital in its new focus area that will constitute the sustained competitive
advantage needed to grow shareholder value.
Finally, on behalf of all Metorex shareholders, I would like to thank my fellow
directors and especially the executive team and all staff, led by our new CEO,
Terence Goodlace, for their considerable efforts in very difficult
circumstances. They have all shown character and steady resolve.
Rob Still
Chairman
December 7th 2009
Sponsor:
Barnard Jacobs Mellet Corporate Finance (Pty) Limited
Public relations adviser:
College Hill
011 447 3030
Date: 07/12/2009 11:17:01 Produced by the JSE SENS Department.
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