Eastplats says loss widens

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IOL BR mining PIC001 REUTERS File image: Reuters

Eastern Platinum Ltd posted a wider quarterly loss due to lower prices and an impairment charge of $88.3 million, and forecast a drop in production for this year and the next.

Platinum producers have been grappling with depressed prices and a rise in pay-related labor disputes in South Africa.

Prices of platinum have suffered from lower demand from European carmakers for the autocatalyst metal used in diesel engines. Even the threat of supply outages in major producer South Africa has failed to reverse the price decline.

Platinum prices have fallen 16 percent from last year to average $1495.17 per ounce during April-June.

Eastplats, which produces platinum group metals such as platinum, palladium and rhodium, expects to produce about 75,000 platinum group metals (PGM) ounces this year and 60,000 ounces in 2013.

It produced 92,724 ounces in 2011.

The net loss attributable to equity shareholders widened to $85.7 million, or 9 cents per share, in the second quarter from $8.0 million, or 1 cent per share, a year earlier.

Eastplats recorded the impairment charge on its Eastern Limb properties in the quarter, said the company, which operates the Crocodile River mine on the Western Limb of the Bushveld Complex.

The company said PGM sold in the quarter increased 29 percent to 26,412 ounces.

Eastplats suspended funding for its Mareesburg mine and Kennedy's Vale concentrator plant in South Africa in May.

Aquarius Platinum Ltd, the world's fourth-largest platinum miner, reported a full-year loss last week on lower production and foreign exchange loss.

Eastplats shares closed at 18.5 Canadian cents on Monday on the Toronto Stock Exchange. - Reuters

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