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Barplats Investments Limited - Consolidated Interim Results For The Six Months
Release Date: 12/02/2004 08:00:24 Code(s): BPL
Barplats Investments Limited - Consolidated Interim Results for the six months
ended 31 December 2003
Barplats Investments Limited
(Incorporated in the Republic of South Africa)
(Registration number 1987/004830/06)
Share code: BPL
ISIN: ZAE000028692
("Barplats")
Consolidated Interim Results for the six months ended 31 December 2003
Key features
* Net loss of R21 million
* Mining operations suspended at Crocodile River and operation placed on care-
and-maintenance
Income Statement
Six months Six months Year to
to 31 Dec. to 31 Dec. 30 June
2003 2002 2003
(R"000) (Reviewed) (Unaudited) (Audited)
Sales 109 367 107 781 154 558
Cost of sales 115 541 107 283 198 185
Contract mining cost 50 595 56 728 100 004
Smelter slag purchased 22 268 - -
Contract concentrating costs 23 900 23 472 44 511
Amortisation 14 672 22 960 45 257
Other costs 4 106 4 123 8 413
(Loss)/profit from operations (6 174) 498 (43 627)
Profit on disposal of mineral - - 1 611
rights
Net exploration (235) (4 162) 266
(expense)/income
Other expenses (1 403) (978) (4 744)
Finance costs - net (13 292) (12 278) (20 346)
Loss before taxation (21 104) (16 920) (66 840)
Income tax expense 25 76 127
Net loss (21 129) (16 996) (66 967)
Basic loss per share (cents) (9) (8) (30)
Headline loss per share (9) (8) (31)
(cents)
Balance Sheet
As at As at As at
31 Dec. 31 Dec. 30 June
2003 2002 2003
(R"000) (Reviewed) (Unaudited) (Audited)
ASSETS
Non-current assets 206 860 215 798 217 866
Current assets 52 140 51 322 30 785
Total assets 259 000 267 120 248 651
EQUITY AND LIABILITIES
Capital and reserves 81 086 152 186 102 215
Non-current liabilities 22 952 33 591 29 299
Current liabilities 154 962 81 343 117 137
Total equity and liabilities 259 000 267 120 248 651
Statement of Changes in Shareholders" Equity
Share Share Retained
(R"000) capital premium earnings Total
Balance at 31 Dec. 2 225 1 049 928 (899 967) 152 186
2002
Net loss (49 971) (49 971)
Balance as at 30 2 225 1 049 928 (949 938) 102 215
June 2003
Net loss (21 129) (21 129)
Balance at 31 Dec. 2 225 1 049 928 (971 067) 81 086
2003
Cash Flow Statement
Six months Six months Year to
to 31 Dec. to 31 Dec. 30 June
2003 2002 2003
(R"000) (Reviewed) (Unaudited) (Audited)
Cash flows from operating (45 136) 24 387 3 936
activities
Cash flows from investing (10 655) (20 195) (34 776)
activities
Cash flows from financing 55 832 (4 201) 30 947
activities
Net increase/(decrease) in 41 (9) 107
cash and cash equivalents
Cash and cash equivalents at 204 97 97
beginning of period
Cash and cash equivalents at 245 88 204
end of period
Notes
The interim financial statements have been prepared using accounting policies
consistent with those of the annual financial statements for the year ended 30
June 2003 and conform with IFRS on Interim Financial Reporting.
Finance costs - net includes exchange rate transaction losses of R5.6 million,
as a result of the stronger rand as at 31 December 2003 (2002: R6.2 million).
Capital expenditure for the period under review amounted to R4.4 million (2002:
R21.1 million). Capital expenditure approved and committed at 31 December 2003
amounted to nil (2002: R19.2 million).
Current liabilities includes a loan facility from Impala Platinum Limited of
R200 million of which R136,7 million has been utilised. This facility bears
interest at the Johannesburg Interbank Acceptance Rate (JIBAR) plus 2% and any
outstanding balance will be repaid from cash generated from operations.
Non - current liabilities comprises the provision for environmental obligations.
Audit review
The results for the six months ended 31 December 2003 have been reviewed in
terms of the listing requirements of the JSE Securities Exchange SA by the
company"s auditors, PricewaterhouseCoopers Inc. This review opinion is available
on request from the Company Secretaries.
Operating Statistics
Six months Six months Year to
to 31 Dec. to 31 Dec. 30 June
2003 2002 2003
Production
Ore milled (000t) 178 307 472
Smelter slag (000t) 127 - -
purchased and
processed
Metal in concentrate
Platinum (ozs) 19 281 16 290 24 500
Palladium (ozs) 8 050 7 415 11 000
Rhodium (ozs) 2 848 2 584 3 900
Nickel (t) 71 25 37
PGM in concentrate (ozs) 36 953 32 300 48 800
Average exchange (R/$) 7.08 10.14 9.46
rate achieved
Closing rate 31 (R/$) 6.61 8.56 7.52
December/30 June
Prices achieved
Platinum ($/oz) 655 491 513
Palladium ($/oz) 169 240 213
Rhodium ($/oz) 401 406 426
Nickel ($/t) 9 535 4 994 5 443
Cost per platinum
ounce in concentrate
Cash operating cost (R/oz) 5 226 5 114 6 242
Net of revenue (R/oz) 3 942 3 150 4 502
received from other
metals
Capital expenditure (R000) 4 407 21 095 50 961
The Market
* Ongoing solid fundamentals in the platinum market together with renewed
investor interest pushed prices to 23-year highs. Calendar year 2003 was the
fifth year of consecutive supply deficits in the platinum market.
* While the strength in the platinum price impacted on jewellery demand for the
year, the resilience of this market, given the impact of the SARS epidemic as
well as global economic uncertainty, has been remarkable. Once again, ever
stricter emission legislation and the growth in the popularity of European
diesels underpinned platinum demand.
* The average dollar price achieved for platinum during the six months to end
December 2003 was 33% higher than for the corresponding period in 2002.
* The palladium and rhodium markets continued to be adequately supplied and the
dollar prices received of both these metals declined.
* As with platinum, speculative interest resurfaced in palladium towards the end
of the year, which would appear to belie the short-term fundamentals.
* Nickel prices were boosted by strong Asian demand which led to a 91% increase
in US dollar revenues derived from nickel sales.
* Whereas the basket price per platinum ounce in concentrate sold was 22% higher
in dollar terms, the rand basket was 15% lower than the corresponding period.
Crocodile River
* The value of sales rose by 1.5% predominantly due to the treatment of
externally sourced material.
* Platinum produced in concentrate was 18.4% up. Overall production of PGMs in
concentrate was 14.4% up when compared to the previous interim period while the
volume of nickel produced rose by 184%. This increase in production was a result
of the treatment of smelter slag purchased from a third party. The additional
revenue earned by the sale of concentrate produced from the smelter slag
purchased helped to significantly reduce the losses incurred by the mining
activities.
* Cost of sales increased by 7.7% period-on-period, largely owing to the cost of
smelter slag purchased for processing of R22 million but was more than off-set
by the additional revenue.
* The net loss of R21 million for the six months ended December 2003, was 24% up
on the R17 million loss incurred during the previous interim period.
Corporate issues
* Following on the announcement a year ago of the poor performance at the
Crocodile River Mine as a result of the difficult geological conditions
prevailing in the area and weakness in the palladium and rhodium prices,
investigations were held on ways of improving operational efficiency and
returning it to profitability.
* The mine continued to incur substantial losses and the various options
considered to restore viability proved unsuccessful. The situation was
exacerbated by the increase in the value of the rand against the US dollar
during the period.
* Consequently, the Barplats board suspended operations at Crocodile River and
placed the mine on care-and-maintenance. Trial mining at Zandfontein continues
and efforts were made to source supplementary supplies of ore to process through
the plant. As a consequence of terminating the mining contract, a dispute has
arisen with BTX, which has been referred to abitration.
* Barplats has been reliant on a R200 million loan from Impala Platinum Limited
to fund operations. Of this, R136.7 million had been used by the end December
2003. Sufficient funds are available through the Implats loan to support the
business as a going concern for the next twelve months after taking into account
the ongoing cost of care and maintenance as well as any potential environmental
and legal liabilities.
* Impala Platinum Holdings Limited, which has an 83% interest in Barplats, has
been involved in negotiations since July 2003 concerning the sale of this
holding.
On behalf of the board
KC Rumble D H Brown Johannesburg
Chairman Director 12 February 2004
Registered office
3rd Floor, Old Trafford 4, Isle of Houghton, Boundary Road, Houghton 2198 (POBox
61386, Marshalltown 2107)
Transfer secretaries
Computershare Limited, 8th Floor, 70 Marshall Street, Johannesburg 2001
(PO Box 61051, Marshalltown 2107)
A copy of this Report is available on Internet website:
http://www.barplatsinvestments.co.za
