Implats reports a 53.88% drop in platinum production
DURBAN – Impala Platinum (Implats) has reported a 53.88 percent decline in production in refined platinum from its own mines to 83 000 ounces, down from 180 000 ounces compared to the same quarter last year, negatively impacted by a mill failure at Mimosa and scheduled maintenance and metallurgical challenges at Two Rivers.
Implats chief executive Nico Muller said the group knew that its first quarter would be characterised by an increase in working capital due to their stringent maintenance schedule at key processing assets.
“Unforeseen challenges at Mimosa and Two Rivers were addressed… to mitigate the impact of the slow-start on full-year production targets at these operations,” Muller said.
He added that the markets for their primary products remained optimistic and they have taken bold steps to advance their stated strategy of repositioning the group through the induced conversion of the dollar convertible bond, and more recently, the announcement of their offer to acquire North American Palladium (NAP).
But the group said yesterday that mining production at Mimosa was maintained during the quarter.
However, concentrate production was impacted by extended repairs to one of the milling circuits and mined volumes were stockpiled during the period and only 589 000 tons were milled, leading to a 16.1 percent decline as compared to last year and platinum in concentrate production decreased by 16.4 percent to 25 000 ounces, down from 30 000 ounces compared to the same quarter last year.
Two Rivers was also impacted by challenging operating conditions, which led to a 3.3 percent decline in tons milled to 798 000 tons during the quarter compared to 825 000 tons last year.
Its strategy at Impala Rustenburg involves plans to outsource mining operations at 1 Shaft and complete the closure of 9 Shaft.
Post the quarter update, Implats has entered into an agreement to acquire 100 percent of the outstanding shares in NAP for an estimated $708 million (R10.48 billion).
However, Implats is confident that it would meet its targets for the full 2020 financial year despite a 4.2 percent year-on-year decrease in platinum in concentrate production and a 24 percent year-on-year decrease in refined platinum output in the first quarter of the financial year.
Impala Platinum shares gained 0.39 percent on the JSE yesterday to close at R103.85.