Eastern Platinum reported a 163 percent increase in revenue for the March quarter, despite foreign exchange losses due to the Covid-19 pandemic.
Picture: Supplied
Eastern Platinum reported a 163 percent increase in revenue for the March quarter, despite foreign exchange losses due to the Covid-19 pandemic. Picture: Supplied

Eastplats remains wary despite rise in revenue

By Dineo Faku Time of article published Jun 5, 2020

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JOHANNESBURG - Eastern Platinum (Eastplats) reported a 163 percent increase in revenue for the March quarter, despite foreign exchange losses due to the Covid-19 pandemic that widened the net loss to equity shareholders.

Eastplats, the Canadian company with South African platinum group metals (PGM) and chrome assets, reported that its revenue had increased to $14.2 million (R241.4million) in March from $5.4 million a year earlier.

The JSE-listed company reported an $8.2 million net loss to equity shareholders, or a $0.09 loss a share compared with a $800000 net loss a year earlier, or a loss of $0.01 share. “The increase resulting from a $8.7 illionm change in foreign exchange losses due to a significant devaluation in the rand to dollar (is) as a result of Covid-19,” it said.

Eastplats said it was in a strong financial position with cash of $8.3 million and net working capital, excluding non-cash deferred revenue of $8.1 million as at March 31.

Net operating cash flows generated were $7.6 million compared with $3.7m a year earlier. Its operating loss narrowed to $1.2 million from $1.8 million last March.

Eastplats warned that the Covid-19 effects were changing rapidly and would impact its ability to meet its 2020 targets and outlook.

The company’s 2020 targets subject to capital availability included the completion of the optimisation programme for the retreatment project and maximising operating results of the retreatment project.

Eastplats said tailings retreatment had returned to full operation at Barplats Mines, following the easing of lockdown restrictions, adding that employees had returned to work.

“Barplats operations were not producing for 18 days. Further, as a result of the change in lockdown levels effective June 1, 2020, Barplats will recall construction contractors in a phased return. Based on the appropriate mobilisation, construction activities are expected to begin in relation to the tailings storage facility wall building and the retreatment project optimisation,” it said.

Eastplats said it continued to update and monitor its risk assessments. It had adopted appropriate procedures, consistent with government directives, to maintain a safe workplace for its employees. “The effects of Covid-19 are changing and evolving and the company cannot reasonably estimate at this time all the impacts of Covid-19 or if new or unexpected changes to the lockdown levels will be imposed by the government of South Africa,” said the company.

Eastplats tumbled 19.19 percent to close at R3.20 on the JSE yesterday.

BUSINESS REPORT ONLINE

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