Londiwe Buthelezi
The JSE has suspended the listing of platinum exploration company Platfields with immediate effect after it failed to submit its provisional report on time, putting the company at risk of being delisted.
The JSE said companies had three months after their year-end to produce financial statements, after which it warned them and the market about a possible suspension.
“If the company still fails to produce the information after another month, the JSE will suspend,” the JSE’s general manager of issuer regulation, Andre Visser, explained.
This is the first time that Platfields has not produced the information needed by the JSE on time.
Visser said the JSE would consider lifting the suspension when the company complied with requirements and published the information.
Bongani Mbindwane, the chief executive of Platfields, said the junior exploration company chose a technical withdrawal of its shares from the JSE because it was in negotiations with potential investors, which were looking to acquire controlling shares in the company.
He said Platfields’s projects had been put under care and no exploration was taking place pending the capital injection, which could come from new investors, and amid worsening global sentiment on exploration.
“While investor negotiations are under way, including the acquisition of a disputed right between Platfields and Anglo Platinum, it is believed that with all things being equal, the resumption of full exploration activities will start in last quarter of 2013,” Mbindwane said.
Platfields has struggled financially for some time and after the fall of platinum prices last year it said its woes were even greater than those of producers because its operations were solely exploratory.
Its exploration assets include the Leeuwkop project in Limpopo, the Berg project and Marula project. Its operations are still not cash generative. In the six months to August last year, the company reported a R7.19 million total comprehensive loss. Its total comprehensive losses for the full year looked even worse. Last year they amounted to R11.3m and in 2011 they were R73m.
Although Platfields was founded in 2002, it has not produced anything from its exploration activities. The accumulated amount the company has spent on exploration in the past two years has been exceeded by operating and other administration expenses.
In the 2011 and 2012 financial years, Platfields accumulatively spent R2.24m on exploration and R23.54m on general and administration costs.
Mbindwane explained the high costs by saying they were related to the listing. It was expensive to be listed when the company was not doing any exploration.
Mbindwane said Platfields had applied to Minister of Mineral Resources Susan Shabangu for the consolidation of its rights in the northern part of the Eastern Bushveld. Part of this application called on the minister to consider the automatic extension of the duration of the rights.
Last year, Mbindwane wrote to the minister saying that many explorers were not going to meet targeted exploration due to the lack of funding for exploration activities in the market. He called on the government to provide protection for the South African junior explorers sector.