A collapse in platinum prices and the suspension of operations in South Africa have been named as the main factors for South Perth-based Aquarius Platinum recorded a $45.7 million net loss for 2008/09.
A collapse in platinum prices and the suspension of operations in South Africa have been named as the main factors for South Perth-based Aquarius Platinum recorded a $45.7 million net loss for 2008/09.
The 2009 financial year loss compares to the previous year's $236.5 million net profit after tax.
"The [loss] is attributable to a number of factors but in the main a collapse of PGM prices during the first half of the financial year and reduced production due to the suspension of operations at the Everest mine in December 2008," Aquarius said.
"Significantly, earnings in the second half of the financial year (2H 2009) reflected a $94.4 million swing resulting in a net profit of $24.4 million in 2H."
Highlights below:
- Group attributable production at target level, closing at 455,675 PGM ounces for the full year
- Net loss reduced from $70.1 million at 1H to $45.7 million (US 13.30 cents per share) at full year
- Successful capital base restructure completed in 2H, with overwhelming shareholding support
- Cash balance at FY close of $154 million, after repayment of R1.577 billion ($177 million) bridge facility in AQPSA
- Recovery in US Dollar prices of major metals from lows experienced towards end of 1H
Operational
- Group attributable production at 455,675 PGM ounces achieved despite suspension of
operations at the Everest Platinum Mine (2008: 500,203 PGM ounces)
- Improved production at all operating units; up 13% in total (excluding Everest & Platinum Mile)
- Recovery in operating margins through 2H at SA operations
Financial
- Revenue decreased 66% from $919 million to $311million as PGM prices collapsed
- Net profit of $24.4 million achieved in 2H reduces full year loss to $45.7 million
- Net mine operating cash flow of $27 million achieved, despite negative provisional price adjustments and significant pipeline advance repayments
- Group debt reduced to $82 million from $210 million
- Group cash balance at $154 million
Strategic
- Capital raising completed by way of equity placement, rights issue and convertible note issue
- Completion of the acquisition of Ridge Mining in July 2009
- FirstPlats transaction agreement concluded, pending s11 transfer in order to complete
- Expansion of Aquarius exploration portfolio in SA
- Mimosa Wedza Phase 5.5 expansion successfully completed and commissioned
Commenting on the results, Stuart Murray, CEO of Aquarius Platinum said, "What a year this was; a year of highs and lows; be it prices, currency volatility in both of our operating domains, the Everest mine suspension, the acquisition of Ridge, and the capital base restructuring, along with the usual challenges the mining industry.
There is no doubt that the collapse in PGM prices pose this industry great issues and indeed posed this company some unique challenges as margins were cut to the bone. Despite this ongoing overhang, Aquarius has responded decisively and has delivered an aggregate 13% production improvement across all its current operations and has managed to reduce the half year net loss of $70 million announced in February 2009 to $45 million by year-end, with more positive prospects appearing. We are grateful to our shareholders for backing the successful strengthening of the balance sheet during these challenging times, enabling opportunities such as the successful acquisition of Ridge and the restart of Everest to occur, both of which will in time further add to the growth profile of Aquarius."
