Johannesburg - The Gupta-owned mining company, Oakbay Resources, surprised the markets by releasing their annual results to the end of February after business closed on Friday.
Members of the Gupta family have been accused of influencing President Jacob Zuma to appoint certain ministers to key cabinet positions among other things.
Observers noted that the release of the results at the end of the business day could have been a strategy to avoid unnecessary media attention.
The results showed a 66 percent increase in revenue to R274 million for the year, while its loss was cut to R17m from R61m during the corresponding period last year.
“The group experienced significantly difficult conditions in recent months as a result of adverse and intense media interest surrounding the company’s majority shareholder. These adverse conditions have resulted in the company experiencing a loss of professional service providers,” the group said in a statement.
The results were audited by SizweNtsalubaGobodo, which stepped in after KPMG dumped the company in March and the country’s four big banks: Absa, First National Bank, Standard Bank and Nedbank announced that they were closing accounts associated with the Gupta businesses.
In April Oakbay announced that non-executive chairman Atul Gupta and chief executive Varun Gupta had resigned with immediate effect. Zuma’s son, Duduzane, also stepped down from the board.
Its flagship Shiva mine near Klerksdorp in the North West province saw a 1 kilogram drop in gold production to 377kg from the previous year. The group reported a 66 percent increase in turnover and a 104 percent improvement in profit before tax as a result of earnings from coal contracts undertaken during the year under review.
Gold production remained constant with 378kg produced in the previous period, compared with 377kg produced in the current period.
Bad publicity has clouded the company since it was reported that Duduzane had a stake in a company that was buying Glencore’s Optimum Coal mine along with the Gupta family.
Before Duduzane’s involvement was disclosed, the transaction had attracted criticism from opposition parties and labour unions because Mines Minister Mosebenzi Zwane was accused of facilitating the deal with Glencore’s chief executive Ivan Glasenberg. Optimum is now selling coal to the Arnot power plant, which is owned by Eskom after the utility decided not to renew a supply contract with Exxaro Resources.
Oakbay also acquired Tegeta Exploration and Resources through its subsidiary Shiva Uranium at the end of February. At the time of the acquisition, the business of Tegeta solely consisted of the Brakfontein coal project. The acquisition was settled through an issue of 100 million shares in Shiva.
Oakbay shares rose 6.98 percent on the JSE on Friday to close at R23.
BUSINESS REPORT