Johannesburg - Johannesburg based Central Rand Gold (CRG) is being run with skeleton staff at its operation as the company grapples with a wage strike, it said on Wednesday.
The troubled JSE-listed gold and exploration company said that it had lost five days of production due to the strike following a deadlock in wage talks.
CRG said it was talking with union officials at the Commission for Conciliation, Mediation and Arbitration (CCMA) to resolve issues.
“To date, May 10, 2017, the company has lost five days’ production, as a direct result of the strike,” the company said. “On May 9 the picketing rules have been signed at the CCMA, thus allowing non-striking workers to return to work. The operation will be run with skeleton staff in the interim.”
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CRG shares remained flat to close at 9cents a share on JSE yesterday. It announced that its shareholder Jia Bang Wang had made a further cash injection as part of a loan for the installation of a concentrate circuit. Wang, its 9.48 percent shareholder, provided the company with $250000 [R3.4million] as part of a loan agreement to the tune of $1m.
“The company is currently working with Mr Wang to assist with the release of the balance of the loan monies,” the company said. “The board of directors are mindful of the company’s cash position, which has been improved by the delivery of this tranche of the loan, and will continue to exercise prudence in its expenditure,” it said.
It said it expected to update the market on progress of the shipping, instalment and commissioning of the concentrator circuit and would provide a further operational update in the coming days.
The loan agreement with Wang last year would be provided in two tranches. It announced in January it had received the first tranche of $500 000. CRG expected the loan to provide the company with sufficient working capital for the immediate future and for the procurement, shipping, installation and commissioning of a concentrator circuit.
CRG, which has dropped 88percent in the year to date, announced its plan to purchase the concentrate circuit in an effort to upgrade its gold grade of the mine waste dumps materials.
It previously said it expected the shipment and installation in the second quarter of 2017.
Last October CRG said it had executed an agreement to acquire mine waste dumps that contain 2.3 million tons of gold-bearing materials, with an average in-situ grade of 0.7grams a ton.
In the wake of the recent downgrades of the country’s credit rating, investors should not fall into the trap of panic selling and should distinguish between the economy and the market.