| Thu 1 Feb 2007, 7:00 | | NHM - Northam Platinum - Unaudited interim results |
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NHM
NHM
NHM - Northam Platinum - Unaudited interim results and dividend declaration
NORTHAM PLATINUM LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1977/003282/06)
("Northam Platinum" or "the company")
JSE code: NHM
ISIN: ZAE000030912
Unaudited interim results and dividend declaration
for the six months ended 31 December 2006
KEY FEATURES
Record PGM market conditions sustained
Sales revenue up 67% to R1.8 billion
Net profit up 118% to R661 million
Headline earnings per share up 115%
Dividend of 245 cents per share declared
INCOME STATEMENT
Six months Six months Year
ended ended ended
31 December 31 December 30 June
Change 2006 2005 2006
% R000 R000 R000
Sales revenue 66.7 1 806 674 1 083 818 2 386 326
Cost of sales 24.5 822 245 660 580 1 375 377
Operating costs 14.0 696 554 610 849 1 242 970
Concentrates purchased 66 364 - -
Refining and other costs 41 650 26 538 59 520
Depreciation 63 684 56 900 114 713
Change in metal inventories (46 007) (33 707) (41 826)
Operating profit 132.6 984 429 423 238 1 010 949
Investment income 35 030 17 360 39 075
Net sundry income 3 142 4 410 19 820
Profit before tax 129.8 1 022 601 445 008 1 069 844
Tax 362 028 141 921 366 606
Net profit attributable to 117.9 660 573 303 087 703 238
shareholders
RECONCILIATION OF HEADLINE EARNINGS
Net profit attributable to 660 573 303 087 703 238
shareholders
Loss/(profit) on sale of 292 (663) (146)
property, plant and equipment
Loss/(profit) on disposal of - (129) (129)
unlisted investments
Tax effect (85) 211 61
660 780 302 506 703 024
Earnings per share - cents 114.3 279.5 130.4 300.9
Fully diluted earnings per 114.0 274.3 128.2 293.6
share - cents
Headline earnings per share - 114.9 279.6 130.1 300.9
cents
Fully diluted headline earnings 114.5 274.4 127.9 293.5
per share - cents
Dividends per share - cents 245.0 115.0 280.0
Weighted average number of 236 363 204 232 510 410 233 704 034
shares in issue
Fully diluted number of shares 240 838 612 236 454 209 239 542 861
in issue
Number of shares in issue 237 001 000 233 220 000 236 003 000
CASH FLOW STATEMENT
Cash flow from operations 728 254 300 988 849 226
Profit before tax 1 022 601 445 008 1 069 844
Depreciation 63 684 56 900 114 713
Change in working capital (90 484) (81 597) (69 755)
Tax paid (273 431) (123 119) (274 694)
Other 5 884 3 796 9 118
Cash utilised in investing (85 250) (100 381) (212 045)
activities
Property, plant and equipment
Additions to maintain (82 965) (99 171) (210 512)
operations
Disposals 1 742 2 075 4 839
Township development (4 027) (3 515) (6 602)
Investments - net - 230 230
Cash utilised in financing (380 140) (91 384) (311 777)
activities
Proceeds from issue of shares 10 031 13 654 64 053
Dividends paid (389 486) (104 451) (373 880)
Increase in investments held
by
Northam Platinum Restoration (685) (587) (1 950)
Trust Fund
Net increase in cash and cash 262 864 109 223 325 404
equivalents
Cash and cash equivalents at 831 286 505 882 505 882
beginning of period
Cash and cash equivalents at 1 094 150 615 105 831 286
end of period
STATEMENT OF CHANGES IN EQUITY
Equity at beginning of period 1 997 173 1 596 753 1 596 753
Net profit attributable to 660 573 303 087 703 238
shareholders
Credit in respect of share- 4 458 2 879 7 009
based payments
Issue of new shares 10 031 13 654 64 053
Dividends distributed (389 486) (104 451) (373 880)
Equity at end of period 2 282 749 1 811 922 1 997 173
BALANCE SHEET
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2006 2005 2006
R000 R000 R000
Property, plant and equipment 1 499 148 1 430 810 1 481 901
Available for sale investments 6 6 6
Township development 10 629 3 515 6 602
Investment held by Northam Platinum 17 078 15 030 16 393
Restoration Trust Fund
Current assets 1 647 400 1 017 012 1 231 073
Inventories 339 795 280 981 280 372
Accounts receivable 213 455 120 926 119 415
Cash and cash equivalents 1 094 150 615 105 831 286
Total assets 3 174 261 2 466 373 2 735 975
Share capital 2 028 817 1 968 387 2 018 786
Equity compensation reserve 27 246 19 553 22 788
Retained earnings/(accumulated loss) 226 686 (176 018) (44 401)
Total equity 2 282 749 1 811 922 1 997 173
Deferred tax 362 154 336 331 357 632
Long-term provisions 26 283 23 630 25 149
Current liabilities 503 075 294 490 356 021
Accounts payable 249 359 176 658 186 380
Tax 253 716 117 832 169 641
Total equity and liabilities 3 174 261 2 466 373 2 735 975
CAPITAL COMMITMENTS
Authorised but not contracted 111 846 38 569 170 105
Contracted 19 403 47 608 17 584
131 249 86 177 187 689
OTHER COMMITMENTS
Information Technology Outsource
Service Provider
Due in one year 8 251 9 351 8 123
Due in two to five years 6 745 18 920 10 224
Operating lease rentals - office
equipment
Due in one year 183 187 622
Due in two to five years 82 144 101
Operating lease rentals - premises
Due in one year 161 148 155
Due in two to five years - 161 81
Housing development 423 - 2 843
These commitments will be financed out of operating cash flows.
OPERATING STATISTICS
Change
Merensky %
Development metres 26.9 6 919 5 451 11 102
Square metres mined (7.7) 137 368 148 862 277 896
Tonnes milled (1.0) 752 215 759 479 1 424 160
Head grade (g/ton - 3 PGEs + (8.2) 5.6 6.1 6.1
Au)
Available ore reserves - 18 19 21
months
UG2
Development metres (26.9) 1 285 1 759 2 818
Square metres mined 11.2 78 152 70 297 138 170
Tonnes milled 15.2 499 397 433 566 878 924
Head grade (g/ton - 3 PGEs + (6.5) 4.3 4.6 405.0
Au)
Available ore reserves - 23 28 26
months
Combined
Development metres 13.8 8 204 7 210 13 920
Square metres mined (1.7) 215 520 219 159 416 066
Tonnes milled 4.9 1 251 612 1 193 045 2 303 084
Head grade (g/ton - 3 PGEs + (7.3) 5.1 5.5 5.5
Au)
FINANCIAL STATISTICS
Precious metals in kg (3.3) 5 618 5 807 11 247
concentrates produced *
Precious metals in kg 263 - -
concentrates purchased
*
Precious metals sold * kg (7.0) 5 455 5 867 11 285
Average price realised R/kg 66.7 278 505 167 079 189 286
*
Operating costs * R/kg 17.7 135 320 114 987 120 711
Cash costs * R/kg 17.7 122 989 104 508 109 677
Precious metals in oz (3.3) 180 623 186 704 261 599
concentrates produced *
Precious metals sold * oz (7.0) 175 382 188 628 362 821
Average price realised US$/oz 50.4 1 200 798 918
*
Operating costs * US$/oz 5.8 581 549 587
Cash costs * US$/oz 5.8 528 499 534
Average exchange rate US$1.00 10.9 7.22 6.51 6.41
realised = R
* - 3PGE + Au
Operating costs per R/tonne 8.4 607 560 589
tonne milled
Cash costs per tonne R/tonne 8.4 552 509 536
milled
COMMENT ON RESULTS
Safety
The company achieved one million fatality-free shifts in August 2006. The
company remains committed to improving safety. The Board regrets the death of
two employees in mining-related accidents and extends its condolences to the
families.
Operating performance
As a consequence of the anticipated difficult mining conditions on the Merensky
pothole facies greater emphasis was put on increasing UG2 tonnage mined.
Consequently total tonnage milled was 4.9% higher and the average head grade
declined by some 7.3%.
Mining production of metal in concentrates (3PGE + Au) at 5 618 kg (180 623 oz)
was only 3.3% lower than the production of 5 807 kg (186 704 oz) during the
period ended 31 December 2005.
Given the current mining and geological conditions the Merensky ore reserves
decreased by 14% to 18 months although total development metres increased by
13.8%. The UG2 ore reserve remained satisfactory at 23 months.
Financial results
The combination of a 50.4% increase in the average US Dollar basket price
received to US$1 200 per ounce, and a weakening of the Rand resulted in the
average Rand basket price received increasing by 66.7% to R278 505 per kg. This,
despite a drop of 7.0% in unit sales to 5 455 kg (175 382 oz) because of
increased stock levels, resulted in sales revenue increasing by 66.7% to R1 807
million.
Net sundry income increased by some 75% as a result of higher cash balances and
higher interest rates.
The profit attributable to shareholders increased by 117.9% to R661 million
compared with that for the six months ended 31 December 2005.
Costs
Total operating costs increased by 14.0% from R611 million to R696 million. This
was attributable to the 4.9% higher tonnage milled an increase in the
development metres of 13.8% together with inflationary increases in labour and
engineering costs. Operating costs per tonne milled increased by 8.4% to R607
compared with that for the six months ended 31 December 2005.
The increase in total operating costs together with the marginally lower
production resulted in the unit cash operating costs increasing by 17.7% to R122
989 per kg.
Hedging
No hedging activities occurred during the period.
Capital expenditure
Development expenditure (R21 million) and access infrastructure to 1 level and
14 level (R26 million) were the major contributors to the capital expenditure of
R83 million, with routine capital expenditure comprising the balance.
Prospects
Production of metals in concentrate and sales of PGMs in the second half of the
financial year are expected to be some 15% lower than those of the first half.
Consequently, should the Rand basket price received remain at current levels, a
decrease in earnings commensurate with the lower production may be expected in
the second half of the financial year.
Accounting policies - basis of preparation
The financial statements have been prepared on the historical cost basis, except
for financial instruments that are fairly valued, in accordance with
International Financial Reporting Standards (IFRS) issued by the International
Accounting Standards Board and incorporate the accounting policies which are
consistent with those adopted in the financial year ended 30 June 2006.
Dividend
Dividend number 16 of 245 cents per share has been declared in South African
currency, in respect of the six months ended 31 December 2006.
The dividend will be paid on Monday, 26 February 2007 to shareholders recorded
in the books of the company at the close of business on Friday, 23 February 2007
(the record date). The last day to trade cum dividend is Friday, 16 February
2007. The shares will commence trading ex dividend on Monday, 19 February 2007
and the record date is Friday, 23 February 2007.
No share certificates may be dematerialised or rematerialised between Monday, 19
February 2007 and Friday, 23 February 2007, both days inclusive.
On behalf of the Board
T M G Sexwale G T Lewis
Chairman Chief Executive Officer
Johannesburg
31 January 2007
Registered Office
1st Floor, Block 1A PO Box 412694
Albury Park Craighall, 2024
Magalieszicht Avenue Republic of South Africa
Dunkeld West, 2196
Johannesburg
Directors: T M G Sexwale (Chairman), G T Lewis (Chief Executive Officer)
(British), M E Beckett (British), Ms N J Dlamini (Dr), R Havenstein, Ms E T
Kgosi, R G Mills, R H H van Kerckhoven (Belgian), B R van Rooyen (Alternate: P C
Pienaar), M J Willcox
Company Secretary: S J van der Spuy
Sponsor: Barnard Jacobs Mellet Corporate Finance (Pty) Limited
These results are available on our website at www.northam.co.za
Date: 01/02/2007 07:00:01 Produced by the JSE SENS Department.
