| Thu 6 Feb 2003, 9:08 | | NORTHAM PLATINUM LIMITED - INTERIM REPORT AND DIVI |
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NORTHAM PLATINUM LIMITED
A broadly-based black empowerment company
(Registration number 1977/003282/06)
(Incorporated in the Republic of South Africa)
Interim report and dividend declaration for the six months ended 31 December
2002
KEY FEATURES
* Sales revenue up 28% to R854 million
* Headline earnings up 64% to R207 million
* Interim dividend up 29% to 90 cents per share
* Merensky ore reserves up 50% to 18 months
* Smelter rebuild on schedule
* Two million fatality free shifts achieved
Income statement
Six months Six months Year
ended ended ended
31 December 31 December 30 June
Change 2002 2001 2002
% R000 R000 R000
Sales revenue 27.6 854 382 669 411 1 560 685
Cost of sales 15.9 552 544 476 712 975 549
Operating costs 32.0 493 611 374 075 803 514
Refining and other costs 35 627 17 528 41 394
Depreciation 47 100 42 924 99 451
Change in metal stocks (23 794) 42 185 31 190
Operating profit 56.6 301 838 192 699 585 136
Investment income 35 343 23 000 52 023
Sundry revenue 2 375 21 181 20 852
Sundry expenditure (2 090) - (59)
Profit before tax 42.5 337 466 236 880 657 952
Tax 129 999 109 881 259 121
Net income 63.4 207 467 126 999 398 831
Reconciliation of headline earnings
Net income 207 467 126 999 398 831
Impairments - - 7 873
Profit/(loss) on sale of fixed assets 13 183 421
Headline earnings 207 454 126 816 406 283
Headline earnings 63.6 207 454 126 816 406 283
Headline earnings per share - cents 63.3 89.8 55.0 176.1
Fully diluted earnings
per share - cents 62.5 88.7 54.6 174.6
Distribution per share - cents 28.6 90.0 70.0 245.0
Weighted average number
of shares in issue 231 097 549 230 634 856 230 744 049
Number of shares in issue 231 516 000 230 724 500 230 914 500
Cash flow statement
Cash flow from operations 308 168 215 444 747 481
Profit before tax 337 466 236 880 657 952
Depreciation 47 100 42 924 99 451
Change in working capital (48 175) (15 966) 58 522
Tax paid (28 883) (48 976) (69 176)
Other 660 582 732
Cash utilised in investing activities (49 210) (43 785) (87 575)
Cash from/(utilised in) financing activities (398 167) (310 829) (472 802)
Proceeds from issue of shares 6 608 865 1 580
Reduction of share premium (173 298) - -
Dividends paid (231 064) (311 350) (472 942)
Increase in Restoration Trust Fund (413) (344) (1 440)
Net cash flow (139 209) (139 170) 187 104
Cash at beginning of period 731 313 544 209 544 209
Cash at end of period 592 104 405 039 731 313
Operating statistics
Merensky
Development metres 7 230 7 635 14 622
Square metres mined 170 487 127 312 264 463
Tons milled 797 422 599 040 1 288 141
Head grade (g/ton - 3 PGEs + Au) 6.0 5.9 6.1
Available ore reserves - months 18 12 17
UG2
Development metres 783 949 2 148
Square metres mined 66 018 55 092 116 931
Tons milled 332 655 300 476 643 286
Head grade (g/ton - 3 PGEs + Au) 4.0 3.8 3.8
Available ore reserves - months 37 25 36
Combined
Development metres 8 013 8 584 16 770
Square metres mined 236 505 182 404 381 394
Tons milled 1 130 077 899 516 1 931 427
Head grade (g/ton - 3 PGEs + Au) 5.4 5.2 5.3
Statement of changes in equity
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2002 2001 2002
R000 R000 R000
Equity at beginning of period 1 892 908 1 965 439 1 965 439
Net income for the period 207 467 126 999 398 831
Issue of new shares 6 608 865 1 580
Reduction of share premium (173 298) - -
Dividends distributed (231 064) (311 350) (472 942)
Equity at end of period 1 702 621 1 781 953 1 892 908
Balance sheet
Fixed assets 1 251 870 1 261 976 1 249 774
Unlisted investments 187 226 173
Northam Platinum Restoration Trust Fund 8 981 7 472 8 568
Current assets 960 078 777 097 1 038 062
Inventories 272 529 243 993 249 252
Accounts receivable 95 445 128 065 57 497
Cash and cash equivalents 592 104 405 039 731 313
2 221 116 2 046 771 2 296 577
Share capital 2 124 303 2 290 278 2 290 993
Accumulated loss (421 682) (508 325) (398 085)
Shareholders` equity 1 702 621 1 781 953 1 892 908
Deferred tax 303 873 127 867 249 103
Long-term provisions 10 053 8 761 9 393
Current liabilities 204 569 128 190 145 173
Accounts payable 137 600 115 371 124 550
Tax 66 969 12 819 20 623
2 221 116 2 046 771 2 296 577
Capital expenditure
Capital expenditure incurred
during the period R000 49 196 43 741 90 170
Capital committments at end of period
Contracted R000 114 790 9 010 7 259
Authorised but not contracted R000 73 304 48 136 89 760
R000 188 094 57 146 97 019
Precious metals in
concentrates produced - 3 PGEs + Au kg 5 205 3 867 8 458
oz 167 348 124 330 271 937
Precious metals sold - 3 PGEs + Au kg 4 898 4 192 8 994
oz 157 461 134 776 287 546
Average price realised - 3 PGEs + Au R/kg 158 289 147 596 160 367
$/oz 508 486 497
Operating costs - 3 PGEs + Au R/kg 103 881 107 832 105 426
$/oz 320 355 325
Cash costs - 3 PGEs + Au R/kg 94 705 96 582 94 861
$/oz 292 318 292
Accounting policies
The financial statements have been prepared on the historical cost basis in
accordance with International Accounting Standards and South African Statements
of Generally Accepted Accounting Practice and incorporate the accounting
policies which are consistent with those adopted in the previous year.
Comment on results
Safety
Management is pleased to record that the mine achieved two million fatality
free shifts in September 2002. Management deeply regrets the subsequent death of
an employee in a mining-related accident during December 2002.
Operating performance
Production of 5 205 kg (3 PGE + Au) metals in concentrates was 34.6% higher
than production for the six months ended 31 December 2001. The latter period was
affected by the previously reported 5-week strike.
Good progress continues with the development programme to establish Merensky
reserves as evidenced by the increase in the available ore reserves from 12
months at 31 December 2001 to 18 months at 31 December 2002. UG2 reserves are as
planned.
Production from the UG2 reef horizon has met the planned production targets.
The rebuilding of the smelter furnace, which commenced in January 2003, is
proceeding according to plan, and the furnace is expected to be operational in
March 2003.
Financial results
In US Dollar terms, the decline in the prices of palladium and rhodium was
more than offset by the rising platinum price, but this benefit was partially
negated by the strengthening Rand. The average price realised per kg (3 PGE +
Au) therefore increased by only 7% to R158 289. This, coupled with the 706 kg
improvement in sales volumes, resulted in a 28% improvement in sales revenues to
R854 million.
The focus on reducing costs was maintained and unit cash costs declined by
2.0% compared to the six months ended 31 December 2001. Cost of sales increased
in line with the higher production and sales.
The strengthening Rand was largely responsible for the decrease in net sundry
revenue.
The profit attributable to shareholders increased by 63% compared to the six
months ended 31 December 2001.
Hedging
During the period the company embarked on a hedging programme to protect its
revenues from a potential decline in the palladium price. At 31 December 2002,
an average of 2 000 ounces of palladium per month until December 2003 had been
hedged at an average of US$247 per ounce.
In terms of AC 133 - Financial Instruments: Recognition and Measurement, the
hedging instruments have been recognised at fair value at the end of the period,
with a gain of R2.7 million being included in net income.
Prospects
Provided production and cost targets are met, and the Rand basket price for
metals remains at its current level, earnings for the second half of the year
should approximate those of the current reporting period.
Retirement of managing director
The board extends its appreciation for the outstanding contribution to the
company over the years made by Ian Watson, who retired as managing director in
December 2002. Ian Watson was involved with Northam since its inception and has
served as managing director since 1998, during which time the company
experienced a dramatic turnaround.
Glyn Lewis has assumed the position of general manager, reporting directly to
the board.
Proposed reduction of share premium
The company is proposing a further reduction in its share premium account,
amounting to 20 cents per share. A notice convening a meeting of shareholders to
consider this proposal will be issued shortly.
Dividend
Dividend number 9 of 90 cents per share has been declared in South African
currency, in respect of the six months ended 31 December 2002.
The dividend will be paid on Monday, 3 March 2003 to shareholders recorded in
the books of the company at the close of business on Friday, 28 February 2003
(the record date). To comply with the requirements of STRATE the last day to
trade cum dividend is Friday, 21 February 2003. The shares will commence trading
ex dividend on Monday, 24 February 2003 and the record date is Friday, 28
February 2003.
No share certificates may be de-materialised or re-materialised between
Monday, 24 February 2003 and Friday, 28 February 2003, both days inclusive.
On behalf of the board
T M G Sexwale B R van Rooyen
Chairman Director
Johannesburg
5 February 2003
Registered Office: Kenilworth House PO Box 37160
Rutherford Estate Birnam
1 Scott Street 2015
Waverley 2090 Republic of South Africa
Johannesburg
Share code: NHM
ISIN: ZAE 000030912
Directors: T M G Sexwale (Chairman), M E Beckett (British), B E Davison,
D T G Emmett, A S Malone, E Molobi, R H H van Kerckhoven
(Belgian), B R van Rooyen, M J Willcox
Company Secretary: S J van der Spuy
These results are available on our website at www.northam.co.za
Date: 06/02/2003 07:30:00 AM Produced by the JSE SENS Department
