Sallies Initiates Turnaround Strategy As Performan
Sallies Limited
For further information call
Lindsay Robertson on 082 807 7709
SALLIES INITIATES TURNAROUND STRATEGY AS PERFORMANCE PLUMMETS
Johannesburg, 26 March 2003 - Fluorspar miner Sallies today reported a sharp
deterioration in its operational and financial results for the six months to
December but said recently retained turnaround specialists FRM Strategies had
started implementing a recovery plan.
The company posted an attributable loss of R6.6 million at the halfway mark
against a profit of R2.4million for the corresponding period in 2001. It
attributed this mainly to a 22% drop in production, resulting from lower head
grades and recoveries, and a consequent rise in costs. The production decline
was due to an enforced shift from a higher grade to a lower grade deposit.
FRM"s Lindsay Robertson, who took over as Sallies" interim chief executive last
month, said an extensive exploration programme was being undertaken to improve
the reliability of the current geological model. Resumption of mining the
higher-grade ores would be considered when this had been completed.
"We"re also looking at ways of optimising the upgrade of the flotation plant,
completed in December last year, with a view to its accommodating a higher feed
rate, increasing recoveries and improving quality," he said. Early indications
were that the upgrade had already cut production costs by some 15%, he noted.
Robertson said the turnaround drive would also focus on the improvement of mine
planning, operational efficiencies and overall controls at Sallies" Witkop
operation. While the recovery plan should arrest Sallies" rate of decline in
the second half of 2003, it would take several years for its full effects to
flow through to the bottom line, he said.
The bulk of Sallies" revenue comes from the export of acid-grade fluorspar and
it has already sold the plant"s full production for the 2003 calendar year. The
plant upgrade has also enabled it to produce metallurgical grade fluorspar,
which it previously bought from another producer and briquetted for sale into
the local market.
Issued by du Plessis Associates on behalf of Sallies Limited. dPA contact
Kathy du Plessis on Tel : +27 11 728 4701, Fax: +27 11 728 2547 or e-mail:
gen@dpapr.com
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