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Aquarius Platinum: Production Results to 31 December 2015

Thu 28th January, 2016 7:00am
AQUARIUS PLATINUM LIMITED                           

                    Production Results to 31 December 2015                     


  * Attributable production from operating mines up 0.5% compared to previous
    corresponding period, quarter ended December 2014(pcp), but lower by 4%
  * Kroondal recorded its highest Q2 production since 2011 and production at
    both Kroondal and Mimosa well ahead of guidance
  * Average US$ PGM basket price decreased 7% for the quarter - down 27%
    compared to pcp
  * Kroondal PGM basket price increased 3% on average (due to the 10% weakness
    in the ZAR/Dollar exchange rate) to R11,206 per PGM ounce
    quarter-on-quarter -  down 12% compared to the pcp
  * Mimosa PGM basket price decreased 12% on average to $890 per PGM ounce
    quarter-on-quarter - down 26% compared to the pcp
  * The Rand weakened against the US Dollar 10% on average quarter-on-quarter -
    down 23% compared to the pcp
  * Cash costs at Kroondal were slightly down to R9,112 per PGM ounce
    quarter-on-quarter - up 2% compared to the pcp
  * Cash costs at Mimosa further reduced by 3% to $772 per PGM ounce
    quarter-on-quarter - down 2% compared to the pcp
  * Track record of excellent cost management continues with costs at both
    Kroondal and Mimosa at lower levels than 3 years ago despite substantial
    increases input costs such as labour, electricity and other costs
  * Aquarius redeemed the outstanding Convertible Bonds which it issued in
    December 2009 at their principal amount outstanding of $125 million in the
  * Cash balance at quarter end of $42 million with a further $2 million
    attributable to Aquarius in JV entities.

                     Q2 2016 Operating Results   
                    Kroondal     Mimosa  PlatMile
4E PGM production                                
      Total (100%    114,842     58,019     2,968
     Attributable     57,421     29,010      2968
4E basket price                                  
             R/oz     11,204               10,743
             $/oz        797        818       756
Cash costs (4E                                   
             R/oz      9,112                8,377
             $/oz        648        772       590
Cash margin (%)          (7)          4       (1)
             R/oz        754                    -
             $/oz         54     186.37         -

Commenting on the results, Jean Nel, CEO Aquarius Platinum said:

Both Kroondal and Mimosa produced ahead of guidance and at reduced costs during
the quarter. Kroondal's production performance deserves particular mention as
Q2 was Kroondal's 12th consecutive quarter of higher than 105 000 PGM quarterly
production and H1 production was highest since 2007. The fact that both
Kroondal and Mimosa's PGM unit costs are lower today than 3 years ago despite
steep increases in labour, electricity and other costs is testimony to
excellent operational management for which Rob Schroder and Winston Chitando
and their teams deserve credit. That said, the lower PGM prices experienced
during the quarter impacted both Kroondal and Mimosa. In order to ensure
sustainability in this macro environment (US$ PGM prices fell to the lowest
level in more than a decade) further cost saving initiatives were implemented
at Kroondal, and specifically Mimosa, which management expects to result in
unit costs reducing further going forward.

In relation to the proposed Amalgamation between AQP and Sibanye, following the
approval by AQP shareholders of the Amalgamation in general meeting on 18
January 2016, AQP continues to co-operate with Sibanye in fulfilling the
remaining conditions precedent to the Amalgamation Agreement and AQP
shareholders will be advised of any material progress in due course.

Production by mine attributable to Aquarius (Operating mines)

PGMs (4E)                             Quarter ended                           
              Dec 2015       Sept 2015     % Change     Dec 2014     % Change 
Kroondal   57,421              58,418        (2)         55,557         3     
Mimosa     29,010              31,205        (7)         30,421        (5)    
PlatMile   2,968               3,890         (24)        2,996          48    
Total      89,399              93,513        (4)         88,974        0.5    

Average PGM basket prices achieved at Aquarius operations

US$ per PGM                             Quarter ended                         
ounce (4E)                                                                    
                Dec 2015     Sept 2015     % Change     Dec 2014     % Change 
Kroondal           797          852          (6)         1,090         (27)   
Mimosa             818          890          (8)         1,111         (26)   
Platinum Mile      756          860          (12)        1,090         (31)   
Weighted Avg.      802          865          (7)         1,097         (27)   

Aquarius Group quarterly attributable production (PGM ounces) to 31 December

See for graph

PGM markets update

Platinum price fell in the final months of the year, despite moving 9.8% higher
across October, ending the quarter below the $900/oz level to finish at circa
$877, a fall of 1.2% across the quarter. Palladium prices also moved lower
across the period, falling significantly in November as the metal fell over
18%, stabalising across December to finish around the $562/oz level.

Macro concerns continued to impact the prices of precious metals with the main
factors impacting demand across the month including: impact of the VW scandal
and continued demand and supply concerns of the PGM complex in China.

The impact of the VW "dieselgate" scandal intially saw a decrease in the demand
for Platinum and an increase in Palladium demand throughout late September.
However, despite an initial rally for Palladium, gains were rapidly given back
as Palladium prices fell through US$600/oz. The longer term implications of the
VW issue remain somewhat unclear with either demand for Palladium increasing as
the primary metal for gasoline catalysts, whilst diesel volume sales will
determine the demand for Platinum as the dominant metal.

Supply in Platinum remained relatively robust and despite weaker US$ prices,
the weakness in the rand and ruble also resulted in a softer fall in prices for
the South African producers which in turn saw supply remain more resilient.
Meanwhile demand looks set to grow for platinum but the pace of this growth is
unclear. Autocats, which equate to circa 43% of platinum demand, look set to
remain relatively resilient as the US continues the strong run, whilst threats
include movement away from diesel engines following the VW scandal.

The rand has endured a torrid weakening run, this year, falling 34% across 2015
from the starting level of circa R11.55/US$1 and breaking through the R14/US$1
level in early November and continuing this trend.

Specific PGM prices commentary

The price of Platinum fell 1.2% over the quarter, finishing at $877/oz with an
average price of $908/oz.   Palladium moved down 13.8% to $563/oz with an
average price of $617 over the quarter. Gold also reported negative gains
across the quarter and reversed gains from the last quarter as it moved 4.8%
lower, finishing at 1061/oz, with an average price of $1104/oz.

12 month individual PGM prices to 31 December 2015 (US$/oz)

12 month PGM basket prices to 31 December 2015 (US$ and ZAR per PGM basket

See for graphs

Operating Review Summary (all numbers on 100% basis)


P&SA1 at Kroondal (Aquarius Platinum - 50%)

  * 12-month rolling average DIIR per 200,000 man hours improved 21%  to 0.50,
    quarter on quarter
  * Production decreased to 1,873,000 tonnes from 1,934,000 tonnes,
  * Head grade decreased  to 2.45 g/t from 2.50 g/t
  * Recoveries increased by 1% to 80%
  * Volumes processed lower at 1,810,000 tonnes
  * Stockpiles at the end of the quarter totalled approximately 205,341 tonnes
  * PGM production decreased by 2% to 114,842 PGM ounces, quarter-on-quarter
  * Revenue in Rand terms increased by 4% to R978 million, quarter-on-quarter,
    due to the weakening of the rand
  * Mining cash costs decreased by 1% to R578 per tonne
  * Unit cost per PGM ounce decreased 0.1% to R9,112 per PGM ounce, Kroondal's
    cash margin for the period improved from -13% to -7%

Kroondal: Production, Cash Cost and Price Analysis

See for graph

   Capital Expenditure                       
   (R'000 unless otherwise   Total  Per 4E oz
   Ongoing establishment of  83,958       731
   Project capital            2,688        23
   Mobile equipment          18,787       164
   Total                    105,432       918



The 3 month DIIR rate increased from 0.38 to 0.48 (two additional accidents in
the current quarter) however the 12 month DIIR improved to 0.50 from 0.65.
Seven Section 54 instructions were issued during the quarter.

Production at Kroondal for the quarter was down 3% to 1,873,000 tons
quarter-on-quarter due to production challenges at Simunye and Kopaneng however
was credibly up 4% compared to the previous corresponding quarter, December
2014 (pcp).

Kroondal achieved its twelfth consecutive +105,000 PGM production quarter. Unit
costs in Rand terms continued to respond positively down 0.1% quarter on
quarter and up 2% compared to the PCP in spite of South Africa's inflation rate
of approximately 6%.

Bambanani, K6 and Kwezi produced ahead of business plan.  Kopaneng focussed on
improving safety and showed a positive production improvement in the last month
of the quarter. Simunye's challenge with machine availability continued during
the quarter and resulted in some structural changes in the machine maintenance
methodology. The December break was used to complete additional maintenance and
repairs to certain units in the fleet.

The raise bore hole at Kopaneng was holed, during the Quarter and equipping is
expected to be completed in Quarter three. Both the other two raise bore holes
scheduled for BP 16, at Simunye and Kwezi are on schedule with the piloting
having been started at Simunye.

Grade declined for the quarter and management control systems were improved on
to assist in the general management of ore quality delivered, these include
waste management/ accounting and also real time Stope Width recording and

Although the plants managed to improve on recoveries, production for the
quarter was down due to a section 54 issued against the K2 plant which resulted
in AQPSA delivering reduced ounces for the quarter.

Operating cash costs per ounce

Unit cash cost per PGM ounce in Dollar terms (before by-product credits) was 9%
lower quarter-on-quarter mainly due to the weaker Rand which depreciated 10%
quarter-on-quarter. Dollar unit cash costs compared to the pcp were 19% lower
due to a 26% weakness in the Rand.

In Rand terms, Kroondal's unit costs for the three months to 31 December 2015
were 0.1% lower and only increased 2% compared to the pcp. This is a very
credible performance with operating costs contained below inflationary levels
of approximately 6% for the third consecutive year.

Kroondal mine: reconciliation of cash costs per 4E ounce

                                      Cost per 4E ounce  
                                      Q2 2016   Q1 2016  
Total operating expenditure             10,255     10,249
Ongoing capital expenditure & mobile     (895)      (619)
Project capex                             (23)       (46)
Transferred from/(to) stockpile          (225)      (461)
On mine cash costs                       9,112      9,123

MIMOSA INVESTMENTS (Aquarius Platinum - 50%)

  * 12-month rolling average DIIR was 0.21 per 200,000 man hours worked
  * Production increased marginally to 656,844 tonnes, quarter-on-quarter
  * Head grade decreased by 1% to 3.63 g/t, quarter-on-quarter
  * Recoveries were  consistent at 78.6%
  * Volumes processed decreased  by 5 % to 638,652 tonnes
  * Stockpiles at the end of the quarter  decreased by 2%  to 133,219 tonnes
  * PGM production decreased by 4% compared to PCP and by 7% to 58,019 PGM
    ounces quarter-on-quarter
  * Revenue decreased by 13% to $46 million from $53 million quarter-on-quarter
  * Mining cash costs per PGM ounce at $772, was 3% lower quarter-on-quarter
  * Stay-in-business capital expenditure was $186 per PGM ounce for the quarter
  * Gross cash profit margin for the period increased from 4% to 7%

Mimosa: Production, Cash Cost and Price Analysis

See for graph

Safety, Health and Environment

  * No fatality was recorded during the quarter.
  * Two LTIs were recorded during the quarter.
  * No restricted work case was recorded during the quarter.
  * Three minor injuries occurred during the quarter.
  * The 12 month rolling LTIFR as at the end of the quarter was 0.13.

Regretfully subsequent to the end of the quarter an employee was fatally
injured whilst working underground on 4 January 2016.  There were no other


Operating cash costs per ounce

Unit cash cost per PGM ounce (before by-product credits) were 3% below the
previous quarter. In response to the sharply lower metal prices, Mimosa
implemented a number of significant cost cutting initiatives during the quarter
which will result in operating costs reducing significantly in H2.

Capital expenditure

Total capital expenditure for the second quarter amounted to $10.8 million.
Expenditure was incurred mainly on mobile equipment, support & drill rigs and
LHDs, the conveyor belt extension, down dip development and ventilation walls.

Mining operations

Mimosa mine operated very well during the quarter, with cordial industrial
relations and meeting most of its production targets. A total of 651,629 tonnes
of ore were blasted for the quarter under review with blasted grades of 1.910g/
t Pt. and 0.158% Ni. The blasted tonnage represents a 2.7% increase compared to
the previous quarter's 634,396 tonnes. Most teams mined through poor ground
conditions during the quarter resulting in preparation constraining the ore
generation cycle.

Hoisted tonnage for the quarter at 656,844 tonnes was 0.4% above previous
quarter`s tonnage of 654,127 tonnes. Hoisting performance is expected to
improve in line with the anticipated improvement in the amount of blasted ore.

Processing plant

The milled tonnage for the second quarter at 638,652Mt was 5% below the
671,507Mt achieved in the previous quarter. Tonnes milled were lower in the
quarter as a result of plant stoppages associated with the rainy season mainly
lightning which often results in power dips as well as a breakdown of the plant
mill motor.

At 79.1% platinum recovery was slightly less than the 79.2% achieved in the
previous quarter with 4Es recovery at 78.6% slightly less than 78.7% achieved
in the previous quarter. The Process Team continues to focus on initiatives to
improve recoveries further.

15% Export Levy on un-beneficiated PGMs/ Deductibility of Royalties

In the 2016 National Budget presentation, the deferment of the VAT on
un-beneficiated platinum to 1 January 2017 was confirmed. However, the
subsequent Finance Bill and Finance Act of 2016 did not include the deferment.
Management is continuing engagements to have the deferment gazetted in a
Statutory Instrument that will give legal effect to the deferment.


The 2016 National Budget was silent on the non-deductibility of royalties for
income tax purposes.

The proposal to render royalties payable by Mimosa non-deductible for income
tax purposes was implemented with effect from the year of assessment beginning
on 1 January 2014, and therefore impacted Mimosa from the start of the 2014
financial year on 1 July 2013.  This position has remained in the 2016 national
budget and hence Mimosa continues to provide for royalties on a non-deductible
basis in its financial statements. The financial impact of the
non-deductibility of royalties for the six months ended December 2015 was
US$1.7 million, 50% of which is attributable to Aquarius. Negotiations are
continuing with the authorities to confirm that the royalties are deductible
for income tax purposes.


The Minister of Youth, Indigenisation and Economic Empowerment gazetted the
frameworks, templates and procedures for implementing the indigenization policy
on the 8th of January 2016. The proposed frameworks simply provide clarity on
the indigenisation law and its implementation, and the Indigenisation Act
remains unchanged.

Mimosa continues to interact with the Ministry of Indigenisation and Ministry
of Mines to work towards a sustainable solution in relation to indigenisation.


Platinum Mile - PMR (Aquarius Platinum - 91.7%)

  * Material processed decreased 4% to 1,124 million tonnes - quarter on
  * Head grade  decreased to 0.57 g/t from 0.58 g/t - quarter on quarter
  * Recoveries decreased to 15%, down from 19% quarter on quarter
  * Production decreased  to 2,968 PGM ounces
  * PGM ounces Cash costs  increased 21% to R8,377 per PGM ounce
  * Revenue decreased to R25 million for the quarter
  * Cash margin for the quarter was (1)%, a decrease  from 23% in the previous

Anglo Platinum started the commissioning of their tailings re-treatment
facility in the quarter. During the start-up feed from this section was
understandably erratic and negatively impacted PMR's  flotation stability and

At the end of the quarter PMR had implemented feed stability through level and
flow control utilizing UG2 feed to keep the flow to the rougher circuit
constant and maximized, which management expects should impact recoveries

Operating cash costs per ounce

                      4E                   6E           4E net of by-products
                 (Pt+Pd+Rh+Au)     (Pt+Pd+Rh+Ir+Ru+Au)      (Ni, Cu& Co)     
Platinum Mile        8,377                7,257                 6,745        


P&SA2 at Marikana (Aquarius Platinum - 50%)

Given the continuing low Rand PGM basket prices, Marikana 4 shaft, the
remaining operating shaft, and the processing plant at Marikana continue on
care and maintenance until further notice.

Chromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum - 50%)

This operation remains on care and maintenance.


Convertible bonds

Aquarius Platinum Limited (Company) redeemed the outstanding Convertible Bonds
which it issued in December 2009 (Convertible Bonds).  The Convertible Bonds
were redeemed at their principal amount outstanding of $125.4 million.

Update on Takeover Offer

Aquarius Platinum Limited shareholders approved the Amalgamation Agreement and
Amalgamation on 18 January 2016. The approvals were a condition precedent to
the transaction between the Company and Sibanye Gold Limited proceeding.  The
only outstanding regulatory approvals required for the transaction to proceed
are those of the South African Competition Commission and the Competition
Tribunal (refer section 1.9 of the Explanatory Memorandum of the Meeting
Materials for further detail).  Once these competition approvals have been
obtained, a timetable of events leading up to the date for payment of the
consideration will be announced to ASX, LSE and JSE and published on Aquarius'
website at

Annual General Meeting

Aquarius Platinum Limited advise that the resolutions put to the meeting on 18
January 2016 were carried by the requisite majority.

Statistical information: Kroondal P&SA1

See for statistical information

Statistical information: Mimosa

See for statistical information

Statistical information: Platinum Mile

See for statistical information

Issued capital

At 31 December 2015, the Company had on issue: 1,508,344,873 fully paid common

Substantial shareholders 31 December     Number of Shares     Percentage   
HSBC Custody Nominees (Australia)              108,473,857             7.19
Chase Nominees Limited                          58,565,718             3.88


Primary       Australian Securities       Trading Information           
Listing:      Exchange (AQP.AX)                                         
Premium       London Stock Exchange       ISIN number BMG0440M1284      
Listing:      (AQP.L)                                                   
Secondary     JSE Limited (AQP.ZA)        ADR ISIN number US03840M2089  
                                          Convertible bond ISIN number  


Broker (LSE)             Broker (ASX)            Sponsor (JSE)           
Barclays                 Euroz Securities        Rand Merchant Bank      
5 The North Colonnade    Level 18 Alluvion       (A division of FirstRand
Canary Wharf             58 Mounts Bay Road,     Bank Limited)           
London E14 4BB           Perth WA 6000           1 Merchant Place        
Telephone: +44 (0) 20    Telephone: +61 (0) 8    Cnr of Rivonia Rd and   
7623 2323                9488 1400               Fredman Drive, Sandton  
                                                 Johannesburg South      

Aquarius Platinum (South Africa) (Proprietary) Ltd

100% owned
(Incorporated in the Republic of South Africa)

Registration Number 2000/000341/07

1st Floor, Block C, Rosebank Office Park, 181 Jan Smuts Avenue, Rosebank, South
Postal Address:          PO Box 7840, Centurion, 0046, South Africa

Telephone:                 +27 (0)10 001 2848

Facsimile:                  +27 (0)12 001 2070

Aquarius Platinum Corporate Services Pty Ltd

100% Owned

(Incorporated in Australia)

ACN 094 425 555

Level 1, Suite 6, SOUTHPOINT, 100 Mill Point Road, South Perth WA 6151,

Postal Address:          PO Box 485, South Perth, WA 6951, Australia

Telephone:                 +61 (0)8 9367 5211

Facsimile:                  +61 (0)8 9367 5233


For further information please visit or contact:

In the United Kingdom and South Africa: In Australia:                          
Jean Nel                                Willi Boehm                            
+27 (0)10 001 2843                      +61 (0) 8 9367 5211                    


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