Eastplats shares dive by more than 13% over its impairments
The JSE-listed platinum group metals (PGM) and chrome company which has plunged 23percent in the year to date told investors that it incurred a net loss to equity shareholders of $21.8million (R313.28m), or a loss of $0.24 per share compared with $7.4m or a loss of $0.08 a share in 2017.
The losses were a result of the $15.5m write down on the Crocodile River Mine (CRM) underground.
The company said cash flows used during the year eased $2.8m compared with $7.8m in 2017, a continued improvement since 2016.
Eastplats chief executive Diana Hu said that the group had generated its first profit in almost six years helped by the chrome retreatment plant at the CRM near Brits which has rebounded from five years of care and maintenance.
“Eastplats has made tremendous strides during 2018 to start the Retreatment Project operations, generate revenue and overall to revitalise the company. Eastplats is targeting the creation of shareholder value and our 2019 goals will further this objective,” Hu said.
The company capitalised $64m at the retreatment plant, which began producing in December last year.
It said it produced some 46786 tons of chrome concentrate at an average grade of 38.6percent at the operation between late December to February.
The company said it expected to ramp-up throughput of tailings material and estimated its ramp-up to near full capacity during the second quarter of the year.
“The Retreatment Project at full capacity is forecast to generate mine operating cash flows from the off-take of chrome concentrate of approximately $1m per month for approximately 5 years,” the company said.
The company also said that it had begun the process of testing and assessing PGM opportunities available for the Retreatment Plant during the second quarter of 2019.
Late last year Eastplats subsidiary Barplats entered into an agreement with Union Solutions on the processing of tailings and chrome from CRM.
The chrome circuit was designed to improve recoveries of chrome concentrate compared to traditional technology, which could expand available resources for mining and processing.
At the end of September 2018, the company said that it had spent $14678, with an estimated $3853 remaining, to complete the Retreatment Project and bring it into revenue generating operations.