| Wed 11 Jul 2001, 0:00 | | President Steyn Gold Mines Limited - Quarterly And |
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QUARTERLY AND INTERIM RESULTS JUNE 2001
Highlights This Previous Percentage
quarter quarter increase
Gold recovered kg 1 427 1 346 6,0
Operating profit Rm 15,9 14,9 6,9
Headline EPS cents 1,7 1,3 28,0
Strong operating cash flow of R27,1 million for the six months to June
Three Three Six
months months months
to June to March to June
GOLD PRODUCTION 2001 2001 2001
Ore milled 000 mt 306 316 621
Gold recovered kg 1 427 1 346 2 773
oz 45 871 43 275 89 147
Yield total g/t 4,7 4,3 4,5
underground g/t 4,9 4,7 4,8
Cash operating costs R/kg 58 118 55 993 57 086
$/oz 223 219 223
Gold price received R/kg 69 309 66 144 67 773
ABRIDGED INCOME STATEMENT '000
Sales: gold 98 887 89 030 187 917
other operations 3 202 3 979 7 181
Cash operating costs:
gold (82 920) (75 366) (158 286
other operations (3 240) (2 741) (5 981)
Cash operating profit: 15 929 14 902 30 831
Amortisation: fixed assets (4 763) (4 134) (8 897)
goodwill (2 319) (2 319) (4 638)
Corporate expenditure (425) (660) (1 085)
Net finance charges (2 080) (2 569) (4 649)
Profit before tax 6 342 5 220 11 562
Taxation (285) (952) (1 237)
Net profit 6 057 4 268 10 325
Weighted average shares in issue '000 503 380 503 380 503 380
Headline earnings per share cents 1,7 1,3 3,0
ABRIDGED BALANCE SHEET 30 June 31 December
2001 2000
R000 R000
ASSETS
Property plant and equipment 186 393 182 882
Goodwill 171 624 176 262
Current assets 58 227 56 029
Total assets 416 244 415 173
EQUITY AND LIABILITIES
Shareholders equity 288 451 278 126
Long-term liabilities 46 205 55 419
Deferred tax 12 345 11 108
Provision for environmental
rehabilitation 18 584 19 567
Current liabilities 50 659 50 953
Total equity and liabilities 416 244 415 173
Capital expenditure:
- incurred for the period 16 073 24 722
- committed but not contracted 23 500 33 750
Number of shares in issue (000) 503 380 503 380
Net asset value per share (cents) 57 55
ABRIDGED CASH FLOW STATEMENT Six months
to 30 June
2001
R000
Cash flow from operating activities 27 102
Cash flow from investing activities (9 188)
Cash flow from financing activities (10 197)
Net increase in cash resources 7 717
Cash and cash equivalents at
beginning of period (20 495)
Cash and cash equivalents at
end of period (12 778)
Production and profitability.
Production for the quarter was increased from 43 275 ounces to 45 871 ounces
(6,0%). Loraine 3 shaft increased its contribution and further increases are
expected.
Cash operating profit increased from R14,9 million to R15,9 million
(6,9%) for the three months. Recovered grade increased from 4,3 grams per
ton to 4,7 grams per ton. President Steyn's mine call factor increased from
61% to 66% during the period.
Strong operating cash flow of R27,1 million for the six months was
achieved. This resulted in a net increase in cash resources of R7,7 million
after the repayment of R10,2 million on long-term loans. Capital expenditure
of R16 million was expedited during the first six months.
Management has decided to build up ore stock to counter a possible
strike. This strike has subsequently been avoided. The stockpile was 16 000
tons at the end of June and the production costs relating to the additional
production has been accommodated in the quarterly figures.
Cash cost for the quarter was US$223 per ounce (R58 118 per kilogram and
R270 per ton milled). This is marginally higher than expected, but the
figure includes the costs relating to the 16 000 tons stock build-up.
Projects such as the "Pot of Gold" and "Golden Triangle" is starting to
contribute to the financial results of the mine.
Prospects
Low energy controlled rock breaking is as previously reported, the backbone
of an integrated continuous mining system. Brandrill has conducted 200
cartridge tests at President Steyn 1a shaft, establishing the integrity of
the controlled rock breaking blasts. The tests were successfully concluded
on the "A" reef as well as the Basal reef. The proficient execution of low
energy controlled rock breaking, under fractured rock circumstances, is a
paramount breakthrough. President Steyn and Brandrill have consummated a co-
operation agreement for the development and implementation of a continuous
mining system. The development phase of the system will be completed during
the next four to six months. Commercial role-out of the system will start
during this final development stage. President Steyn has also entered into a
preferential licensing agreement with Brandrill that will regulate the
execution of the jointly developed intellectual property as well as the
commercial implementation of the technology.
A system has been developed to haul gold bearing mud from underground.
The introduction of this system will add to the recovered gold once in full
operation. This system is based on wet vacuum cleaners sucking the mud from
mud containing dams and a drying process making the mud transportable to the
processing plant.
The ore reserves were increased from 0,87 million ounces to 2,59 million
ounces since October 2000. All shafts are progressing towards opening of
additional working areas that will enhance the flexibility of the
operations.
A production plan is presently being drawn up for the working of the
Freddies waste dump and dam. It is anticipated that gold production will be
initiated by early 2002 from this project.
Efforts to facilitate merging of similar assets with synergistic
attributes have been unsuccessful as has negotiations to accommodate
meaningful black empowerment.
Future
President Steyn's share price and trading liquidity is impeding optimising
the growth potential of the company. Management is investigating this
situation and the company's JSE Securities Exchange South Africa listing and
will in due course make proposals to address the situation.
On behalf of the Board
JS (Mac) van der Merwe
Chief Executive Officer
12 July 2001
Transfer secretaries
Mercantile Registrars Limited, 7th Floor, 11 Diagonal Street,
Johannesburg
Registered office
7 Main Reef Road, Germiston. PO Box 915, Bedfordview 2008
Directors
JS van der Merwe, CR de Wet, FN Lotz, DL Parodi
www.psgold.co.za
