News Column

AQUARIUS PLATINUM LIMITED - Financial and Production Results to 31 March 2014

April 28, 2014

AQUARIUS PLATINUM LIMITED ASX, LSE & JSE Financial and Production Results to 31 March 2014 Highlights Revenue increased by 13% to $60 million (Q2 2014: $54 million) in line with higher prices Mine EBITDA increased 3 fold to $11 million (Q2 2014: $4 million) Group cash balance (excluding cash in joint venture entities) at quarter end $83 million (Dec 2013: $83 million) Cash held in joint venture entities $17 million (Dec 2013$12 million) - 50% attributable to Aquarius Attributable production from operating mines remains ahead of guidance and was in line compared to the quarter ended March 2013, quarter-on-quarter production decreased 4% Cash costs at Kroondal remain below inflationary targets increasing 5% for the nine months ended 31 March 2014 compared to the nine months ended 31 March 2013 (pcp) - quarter-on-quarter costs increased 9% Cash costs at Mimosa remain flat for the nine months ended 31 March 2014 compared to the pcp - quarter-on-quarter costs increased 7% Surface stockpile at Mimosa increased - now 165,000 tonnes Average PGM basket price increased 2% quarter-on-quarter in Dollar terms, down 11% compared to the quarter ended March 2013 The Rand weakened against the US Dollar by 7% on average quarter-on-quarter - down 20% compared to pcp Q3 2014 Operating Results Summary Kroondal Mimosa Platinum Mile 4E PGM production Total (100% basis) 107,818 51,907 289 Attributable 53,909 25,954 289 4E basket price R/oz 12,764 12,810 $/oz 1,179 1,112 1,179 Cash costs (4E basis) R/oz 9,376 27,084 $/oz 866 892 2,492 Cash margin (%) 21 26 (123) Stay-in-business capex R/oz 903 $/oz 83 114 Commenting on the results, Jean Nel, CEO Aquarius Platinum said: During Q3 the company delivered a competent operational performance, Kroondal again delivered production ahead of guidance and Mimosa in line with guidance, while costs at both operations continued to be well maintained at annual increase rates below inflation (CPI). Kroondal in particular continued its good performance and recorded not only its highest ever production for a third financial quarter (107,818 4E oz's) which is traditionally a poor mining quarter due to the Christmas break, but also delivered its 5th consecutive quarter in excess of 105,000 4E oz's per quarter, a record performance in Kroondal's 10 year life. As always, credit for the operational performance is due to the operational management teams at both Kroondal and Mimosa. At corporate level, during the quarter Aquarius finalised the mechanics and terms of the restructure of Aquarius' balance sheet, details of which were announced post quarter end. The Board is particularly encouraged and appreciative of the level of support from our largest shareholders who have indicated their support for the restructure. The Board and management team take their responsibility as custodians of capital seriously, and management will resolutely continue its focus on disciplined safety, production and cost management as the primary focus. Following the completion of the balance sheet restructure, and depending on the metal price and industrial relations environment, Aquarius will carefully assess the merits of pursuing a number of smaller, incremental growth initiatives aimed at increasing production and lowering unit costs. Whilst Aquarius' operations have not been materially impacted by the industry wide strike (Plat Mile production has been interrupted), the company shares the concerns expressed by the entire industry. The company also noted the muted metal price reaction to in excess of 50% of primary platinum production being interrupted for more than a quarter of a year. This further supports management's focus on disciplined capital and cost management. At company level, Aquarius management continues to focus on building sound relations with its work force and organised labour representatives to maintain stability, but clearly Aquarius' South African operations are not isolated and the risk of industrial action remains foremost in our minds and a primary risk to manage. Production by mine Quarter ended PGMs (4E) Mar 2014 Dec 2013 % Change Mar 2013 % Change Kroondal 107,818 110,303 (2) 105,027 3 Mimosa 51,907 55,586 (7) 51,611 1 Platinum Mile 289 1,583 (82) 3,152 (91) Total 160,014 167,472 (4) 159,790 - Production by mine attributable to Aquarius (Operating mines) Quarter ended PGMs (4E) Mar 2014 Dec 2013 % Change Mar 2013 % Change Kroondal 53,909 55,152 (2) 52,514 3 Mimosa 25,954 27,793 (7) 25,805 1 Platinum Mile 289 1,583 (82) 3,152 (91) Total 80,152 84,528 (5) 81,471 (2) Aquarius Group quarterly attributable production (PGM ounces) to 31 March 2014 See www.aquariusplatinum.com for graph PGM markets update The average third quarter platinum price posted a decent gain of 2.3% despite a reasonable degree of volatility over the period primarily due to the supply losses caused by the widespread labour strife in South Africa. Whilst platinum has performed well, it was outperformed by palladium among the PGMs, given that palladium prices have recently reached their highest since late summer/early autumn 2013. Against the dim supply backdrop South African listed palladium ETP holdings continued to build throughout the third quarter, with two funds having been launched in March, while platinum ETP holdings have continued to scale all-time record highs. The South African Rand remained under pressure during the first 3 months of 2014 on the back of macro uncertainty in Europe and weaker growth data from China. Despite considerable intra-period volatility, the Rand closed at R10.52, similar as at the start of the quarter. China's auto sales grew 17.8% year on year (y/y) in February, after a weak January (6% y/y) that was likely affected by the Chinese New Year holiday. In the US, February auto sales also represented an improvement compared to January (15.3M versus 15.2M). Consequent firming up of underlying demand for autocatalytic converters provided support to PGM prices during the quarter. Specific PGM prices commentary The average platinum price increased by 2.3%, while palladium increased by 2.9% and lesser traded rhodium increased by 11.8% quarter on quarter. Gold decreased by 1.6% on average. Platinum closed the quarter up 3.6% at $1,418 per ounce, while palladium rose by 8.3% to $776 per ounce and rhodium rose by 15.9% to $1,130 over the same period. Gold increased 6.5% to $1,284 per ounce. Whilst PGM prices increased during the quarter, it should be noted that the Dollar basket prices for both Kroondal and Mimosa have not increased substantially in nominal terms over the longer term. Since March 2007 (before the GFC) Kroondal's Dollar basket prices decreased by 18% (its Rand basket price increased by 20% due to Rand weakness) whilst Mimosa's Dollar basket price increased by 12%. 12-month individual PGM prices to 31 March 2014 (US$/oz) See www.aquariusplatinum.com for graph 12-month PGM basket prices to 31 March 2014 (US$ and ZAR per PGM basket ounce) See www.aquariusplatinum.com for graph 12-month ZAR price to 31 March 2014 (ZAR/US$) See www.aquariusplatinum.com for graph Average PGM basket prices achieved at Aquarius operations Quarter ended US$ per PGM ounce (4E) Mar 2014 Dec 2013 % Change Mar 2013 % Change Kroondal 1,179 1,145 3 1,315 (10) Mimosa 1,112 1,126 (1) 1,247 (11) Platinum Mile 1,179 1,117 6 1,335 (12) Weighted Avg. 1,157 1,138 2 1,295 (11) Financials Aquarius recorded an on-mine EBITDA profit of $11.1 million for the quarter ended 31 March 2014. This represents an increase in EBITDA of $7.3 million, a 190% increase compared to the previous quarter ended 31 December 2013. Whilst production was marginally down from record levels at Kroondal, this quarter was the fifth consecutive quarter the Kroondal mine achieved in excess of 105,000 PGM ounces of production, 50% of which is attributable to Aquarius. EBITDA, Profit and Production Comparison: Quarter ended Mar Dec Sept Nine months Mar 2014 2013 2013 2014 EBITDA $11.1M$3.8M$6.3M$21.2M Revenue $60.3M$53.5M$59.7M$173.5M Share of profit/(loss) from joint venture $1.8M$1.0M ($0.8M) $2.0M entities (Mimosa & Blue Ridge) (note a) Aquarius Group - Net profit/(loss) after $0.2M ($13.8M) ($10.3M) ($23.9M) tax note a: Share of profit/(loss) from joint venture entities (Mimosa & Blue Ridge) consists of: EBITDA $8.5M$7.8M$5.3M$21.6M Other expenses ($6.7M) ($6.8M) ($6.1M) ($19.6M) Net profit/(loss) after tax contribution $1.8M$1.0M ($0.8M) $2.0M to Aquarius Group Revenue (PGM sales, interest) for the quarter was $60 million, 13% higher compared to the previous quarter following higher metal prices. The PGM basket price achieved for the quarter was $1,157 per PGM ounce, up 2% from the previous quarter. Revenue from Mimosa which is included in "share of profit/ (loss) from joint venture entities" was in line with the previous quarter despite lower production. Quarter ended Kroondal & Platinum Mile Mar Dec Sep Jun Mar 2014 2013 2013 2013 2013 Revenue $56.2M$57.0M$59.4M$61.3M$64.0M PGM sales adjustments $4.1M ($3.5M) $0.3M ($5.4M) $1.6M Total revenue $60.3M$53.5M$59.7M$55.9M$65.6M Mimosa & Blue Ridge (joint venture entities) Revenue $31.5M$34.5M$33.5M$39.5M$35.3M PGM sales adjustments - ($3.3M) ($5.3M) ($4.5M) ($0.4M) Total revenue $31.5M$31.2M$28.2M$35.0M$34.9M Production for the quarter remained strong and is within guidance despite a 4% decrease to 80,124 PGM ounces in the quarter. The reduction in production for the quarter comes off record levels of production being experienced at the Group's mines and also takes into account very low production at Platmile, Aquarius' tailings retreatment plant that receives its feed ore from the Amplats operations, which is currently impacted by labour disputes. Production comparisons Quarter ended Mar Dec Sep Jun Mar 2014 2013 2013 2013 2013 PGM production - Kroondal & 54,198 56,735 56,962 58,261 55,666 Platmile PGM production - Mimosa 25,954 27,793 26,525 28,584 25,805 Total attributable production (PGM 80,152 84,528 83,487 86,845 81,471 oz) Average PGM basket price per ounce achieved Kroondal & Platinum Mile R12,757 R11,577 R11,815 R11,225 R11,674 Kroondal & Platinum Mile $1,179$1,144$1,183$1,193$1,316 Mimosa $1,112$1,126$1,133$1,217$1,247 Total cost of production of $55 million was 5% lower compared to the previous quarter December 2013, in line with lower production, down 4%. This 4% reduction is a function of Plat Mile's production being interrupted. Kroondal production for Q3 is the highest ever third quarter production by Kroondal in its 10 year mine life. Kroondal's unit costs for the nine months to 31 March 2014 remain within inflationary targets having increased 5% compared to the pcp. For the quarter under review, Kroondal's cash costs per ounce in Rand terms increased 9% quarter-on-quarter but only 3% in Dollar terms due to the weaker Rand. This increase in costs was driven primarily by lower production than the record December quarter, and the previously guided increase in reportable cash costs from the treatment of the ore stock pile during the December Christmas break. The good production performance at Kroondal was achieved notwithstanding the mine encountering a number of operational challenges, including, K6 shaft's build up being hampered by a high number of potholes encountered while setting up the strike sections and Kwezi shaft encountering very difficult ground conditions which necessitated a reduction in panel lengths. Despite these challenges, Kroondal's tonnes mined in the third quarter was a record for Q3 tonnes mined. Mimosa's unit costs for the nine months to 31 March 2014 remain flat compared to the pcp at $866. For the quarter under review, cash cost per PGM ounce was $892, a 7% increase quarter-on-quarter. The 7% increase in unit costs was due to reduced PGM production (7%) as a result of planned plant modifications, below budget metal recoveries and power outages. These challenges notwithstanding Mimosa's production levels continue to be in line with company guidance. Depreciation and amortisation for the quarter of $6.6 million was lower due to an increased resource base resulting from the extension of Kroondal's mine life, as previously announced. Administration costs of $1.4 million were lower, in line with the cost reduction initiatives taken by the Aquarius Group. Finance costs for the quarter included interest paid on borrowings of $3 million, non-cash interest accretion on convertible bonds of $3 million and unwinding of the rehabilitation provision of $1 million. The income tax benefit of $0.7 million includes a $0.4 million normal tax credit and a $0.4 million deferred tax credit, offset by $0.1 million, of withholding taxes. Net operating cash inflow for the quarter of $4 million comprised $51 million inflow from sales, $46 million paid to suppliers, $2 million settlement of Everest housing litigation and $1 million interest received. Development and capital expenditure for the quarter was $7 million. Net financing cash inflows of $3 million included dividends of $2 million from Mimosa, $3 million proceeds from equipment leases and $2 million repayment of AQPSA lease liabilities. The Group's cash balance was $83 million at the end of the quarter, held as follows: AQP $42 million AQPSA $35 million ACS(SA) $1 million Platmile $4 million Ridge Mining $1 million Total $83 million (note a) note a Mimosa and Blue Ridge (which Aquarius has a 50% equity interest in) are accounted for using the equity method. Cash held in these two entities at 31 March 2014 was $17 million and does not form part of the above cash balances. Under the previous method of proportionately consolidating its investment in Mimosa and Blue Ridge, 50% of this cash would have been included in Aquarius' Group cash balance. Aquarius Platinum Limited Consolidated Income Statement Quarter ended 31 March 2014 $'000 Quarter Nine Months Financial Ended Ended Year Ended Note 31/03/14 31/03/14* 30/06/13 * PGM production - Kroondal & 54,198 167,867 216,167 Platmile PGM production - Mimosa 25,954 80,272 108,936 Total PGM production 80,152 248,139 325,103 Revenue (i) 60,300 173,473 237,115 Cost of sales (including D&A) (ii) (55,122) (175,873) (248,308) Gross profit/(loss) 5,178 (2,400) (11,193) Other income 43 115 278 Administrative costs (iii) (1,426) (5,762) (12,786) Foreign exchange gain/(loss) (iv) 502 3,233 (19,322) Finance costs (v) (6,992) (22,287) (26,670) Impairment losses (vi) (265) (2,752) (214,111) Profit on sale of assets (vii) 597 566 - Closure, transition and - - (54,538) rehabilitation costs Share of profit/(loss) from joint 1,790 1,956 (2,698) venture entities Loss before income tax (573) (27,331) (341,040) Income tax benefit (viii) 734 3,464 53,127 Net profit/(loss) 161 (23,867) (287,913) Net profit/(loss) is attributable to: Equity holders of Aquarius 224 (23,816) (287,207) Platinum Limited Non-controlling interests (ix) (63) (51) (706) 161 (23,867) (287,913) Earnings per share Basic earnings/(loss) per share 0.00 (5.07) (61.13) (cents per share) * Unaudited Notes on the March 2014 Consolidated Income Statement Revenue for the quarter of $60.3 million was 13% higher than the previous quarter following higher prices and a $7.6 million positive turnaround in sales adjustments. Cost of sales of $55 million for the quarter was 5% lower compared to the previous quarter December 2013 in line with lower production, down 4%. Administrative costs of $1.4 million are in line with previous periods in the current financial year and lower than comparable periods of previous years. Foreign exchange gain is attributable to revaluation adjustments on intercompany loans, cash balances held in Rand, Australian Dollars and Pound Sterling, and the revaluation of pipeline debtors in line with movements in the Rand against the US Dollar. Finance costs include interest paid on borrowings $3 million, non-cash interest accretion on convertible bond $3 million and unwinding of the rehabilitation provision $1 million. Impairment losses arising from a review of the carrying value of non-operating assets, namely Marikana, Ridge Mining, the tailings retreatment operation Platmile, and several mining rights. Profit on sale of assets arose from the disposal of sundry tenements not forming part of the Group's strategic plan. Income tax benefit includes $0.4 million normal tax credit and a $0.4 million deferred tax credit, offset by $0.1 million of withholding taxes. Reflects the 8.3% non-controlling interest of Platinum Mile Resources (Pty) Ltd. Following the acquisition of an additional 41.7% during the during the 2012 financial year, the Group holds 91.7% and controls Platinum Mile Resources (Pty) Ltd.Aquarius Platinum Limited Consolidated Statement of Cash Flows Quarter ended 31 March 2014 $'000 Quarter Nine months Financial Year Ended Ended ended Note 31/03/14* 31/03/14* 30/06/13 Net operating cash inflow/(outflow) (i) 3,759 8,466 (21,448) Net investing cash outflow (ii) (6,922) (17,911) (20,629) Net financing cash inflow/(outflow) (iii) 3,025 12,937 (34,364) Net (decrease)/increase in cash held (138) 3,492 (76,441) Opening cash balance 82,998 77,773 166,652 Exchange rate movement on cash 366 1,961 (12,438) Closing cash balance (iv) 83,226 83,226 77,773 * Unaudited Notes on the March 2014 Consolidated Statement of Cash Flows Net operating cash flow for the March quarter includes $51 million inflow from sales, $46 million paid to suppliers, $2 million settlement of Everest housing litigation (accrued in December accounts) and $1 million interest received. Includes development and plant and equipment expenditure on AQPSA. Includes mining equipment lease facility drawdown $3 million, repayment of lease liabilities $2 million and $2 million dividend received from Mimosa Investments Limited. Aquarius Platinum Limited Consolidated Balance Sheet At 31 March 2014 $'000 As at As at Note 31/03/14* 30/06/13 Assets Cash assets 83,226 77,773 Current receivables (i) 30,200 33,965 Other current assets (ii) 14,138 16,181 Property, plant and equipment (iii) 98,480 105,030 Mining assets (iv) 112,242 121,694 Intangible asset (v) 54,985 59,449 Investments in joint venture entities (vi) 205,128 223,643 Other non-current assets (vii) 68,263 66,203 Total assets 666,662 703,938 Liabilities Current liabilities (viii) 37,627 43,109 Non-current interest-bearing liabilities (ix) 278,171 268,788 Other non-current liabilities (x) 94,161 96,099 Total liabilities 409,959 407,996 Net assets 256,703 295,942 Equity Issued capital 24,416 24,370 Treasury shares (27,286) (26,526) Reserves 625,161 639,854 Accumulated losses (371,218) (347,402) Total equity attributable to equity holders of Aquarius Platinum Limited 251,073 290,296 Non-controlling interests (xi) 5,630 5,646 Total equity 256,703 295,942 * Unaudited Notes on the March 2014 Consolidated Balance Sheet Reflects debtors receivable on PGM concentrate sales. Reflects PGM concentrate inventory, consumables, stores and critical spares. Represents plant and equipment within the Group. Includes group's mining assets at Kroondal, Marikana, Everest, CTRP and Platmile. Includes intangibles relating to contract value acquired on the acquisition of equity interest in Platinum Mile Resources (Pty) Ltd. Reflects investments in joint venture entities, Mimosa and Blue Ridge. Includes the recoverable portion of rehabilitation provision from Anglo Platinum of $10 million, receivable from outside shareholders of Blue Ridge and Sheba's Ridge of $23 million, investments in rehabilitation trusts of $16 million and AQPSA deferred tax asset of $19 million. Includes trade creditors and other payables of $31 million, AQPSA equipment leases of $2 million and leave provisions of $4 million. Includes convertible bonds of $277 million and AQPSA lease facilities of $1 million. Includes deferred tax liabilities $17 million, provision for closure costs $74 million and rehabilitation obligations on PSA1 and PSA2 structures of $3 million. Reflects the 8.3% non-controlling interest of Platinum Mile Resources (Pty) Ltd. Following the acquisition of an additional 41.7% during the 2012 financial year end, the Group now holds 91.7% and controls Platinum Mile Resources (Pty) Ltd. Operating Review Summary (all numbers on 100% basis) AQUARIUS PLATINUM (SOUTH AFRICA) (PTY) LTD (Aquarius Platinum - 100%) P&SA 1 at Kroondal (Aquarius Platinum - 50%) 12-month rolling average DIIR improved to 0.98 per 200,000 man hours from 0.99 in the previous quarter Production decreased to 1,686,000 tonnes from 1,867,000 tonnes, quarter-on-quarter Head grade decreased to 2.38 g/t from 2.42 g/t Recoveries decreased by 0.37% to 78% Volumes processed lower at 1,796,000 tonnes Stockpiles at the end of the quarter totalled approximately 38,000 tonnes PGM production decreased by 2% to 107,818 PGM ounces, quarter-on-quarter Revenue increased by 24% to R1,275 million, quarter-on-quarter, due to improved basket prices and a R43 million positive sales adjustment for the quarter Mining cash costs increased by 7% to R563 per tonne, due to lower volumes Unit cost per PGM ounce increased 9% to R9,376 per PGM ounce due to lower volumes and stock pile treatment costs of R405 per ounce compared to a R237 per ounce credit in the previous quarter Kroondal's cash margin for the period improved from 7 % to 21 % Despite the above, this was a record production Q3 for Kroondal of 107,818 PGM ounces with the next best Q3 production being 107,548 in 2006 This is the 5th consecutive quarter of above 105,000 PGM ounces produced, a Kroondal first See www.aquariusplatinum.com for graph Commentary Kroondal: The 12 month rolling DIIR improved slightly to 0.98 from 0.99 in the previous quarter, whilst the 3 months DIIR rate improved materially from 0.79 to 0.57 following continued focus and management of safety performance including in the implementation of a new Safety programme of "My Life, My responsibility, I will comply". Production at Kroondal for the quarter of 1.7 million tonnes was a Q3 record despite being 10% lower compared to the previous quarter. This good production level was achieved notwithstanding the mine encountering operational challenges including K6 shaft's build up being hampered by a high number of potholes that were encountered while setting up the strike sections and Kwezi shaft encountering very difficult ground conditions which necessitated a reduction in panel lengths. This quarter also saw the changeover of Ackerman's Sections from Simunye Shaft to Bambanani Shaft. This change in management process initially resulted in lower production from this section but has now normalised. A total of seven DMR visits were conducted for the quarter on Kroondal shafts and one concentrator plant which resulted in one section 54 instruction issued at Kopaneng shaft. The focus is still to maintain good working relationships with the DMR office. P&SA2 at Marikana (Aquarius Platinum - 50%) Given the continuing low Rand PGM basket prices, Marikana 4 shaft, the remaining operating shaft, and the processing plant at Marikana continue on care and maintenance until further notice. Everest Mine Similarly, given the continuing low Rand PGM basket prices, temporary geological problems and unstable labour relations, the Everest mine remains placed on care and maintenance until further notice. AQPSA Operating cash costs per ounce (Rand) 4E 6E 6E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni&Cu) Kroondal 9,376 7,702 7,501 Capital expenditure Kroondal (R'000 unless otherwise stated) Total Per 4E oz Ongoing establishment of infrastructure 86,440 802 Project capital (K6 shaft) 10,883 101 Mobile equipment 42,111 391 Total 139,433 1,293 Kroondal mine: reconciliation of cash costs per 4E ounce Cost per 4E ounce (Rand) Q3 Q2 Total operating expenditure 10,084 10,106 Less: Ongoing capital expenditure & mobile equipment (931) (1,048) Project capex (K6 shaft) (182) (209) Transferred from/(to) stockpile 405 (237) On mine cash costs 9,375 8,612 Development of the K6 shaft at Kroondal continues. The project remains on budget and is slightly ahead of time. The Company expects to incur R90 million in capital expenditure (R45 million attributable to Aquarius) on this project during FY14, in line with budget. The final phase of the project relating to the surface infrastructure continues and is scheduled for commissioning in the latter part of Q4. The permanent power construction will be completed during H1 of FY15. MIMOSA INVESTMENTS (Aquarius Platinum - 50%) 12-month rolling average DIIR remained constant at 0.05 per 200,000 man hours worked Production decreased by 5% to 598,094 tonnes, quarter-on-quarter Head grade improved to 3.67 g/t Recoveries were 77.5% Volumes processed decreased by 9% to 568,608 tonnes Stockpiles at the end of the quarter totalled approximately 165,060 tonnes PGM production decreased by 7% to 51,907 PGM ounces quarter-on-quarter, due to challenges experienced after the February 2014 plant shutdown Revenue increased by 1% to $63 million, from $62m in the previous quarter Mining cash costs increased by 9% to $81 per tonne, and costs per PGM ounce by 7% to $892 due to decrease in production Stay-in-business capital expenditure was $114 per PGM ounce for the quarter Cash profit margin for the period increased from 18% to 26% See www.aquariusplatinum.com for graph Operating cash costs per ounce Unit cash costs per PGM ounce (before by-product credits) were 7% higher than the previous quarter. The 7% increase was due to a reduction in PGM production (7%) as a result of production challenges experienced during the quarter. These challenges included plant breakdowns, below budget metal recoveries and power outages. 4E 6E 4E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu & Co) Mimosa 892 844 595 Capital expenditure The total capital expenditure for the third quarter amounted to $6.5 million. Expenditure was incurred mainly on mobile equipment, drill rigs and LHDs, the conveyor belt extension and down dip development. TAILINGS OPERATION Platinum Mile (Aquarius Platinum - 91.7%) Material processed decreased 75% to 265 000 tonnes, quarter-on-quarter Head grade decreased to 0.51 g/t Recoveries decreased to 6% Production decreased to 289 PGM ounces from 1,583 PGM ounces in the previous quarter Cash costs increased to R27,084 per PGM ounce from R6,641 per PGM ounce in the previous quarter Revenue was R4 million for the quarter The cash margin for the period was negative 123% Commentary Platinum Mile: Platinum Mile derives its feed-stock from a concentrate plant owned and managed by Anglo Platinum which has been on strike since 25 January 2014. This strike has entered its 11th week and the parties remain far apart in the wage negotiations. As a result of the strike the Platinum Mile operation has received no feed from Anglo. It is not possible to draw any meaningful comparison with the results of the previous quarter. The cash costs numbers are also materially distorted because of very low feed and production volumes. It should also be noted that the fourth quarter's production will also be impacted by the strike action which at the time of this release was still ongoing. The coarse grinding expansion has been completed during the strike period and commissioning will start once Anglo Platinum resumes its operations. Operating cash costs per ounce 4E 6E 4E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu& Co) Platinum Mile 27,084 23,365 Chromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum - 50%) This operation remains on care and maintenance. CORPORATE MATTERS Tender Offer and Rights Issue On 7 April 2014, Aquarius Platinum Limited announced a tender offer to purchase a minimum of $150 million and a maximum of $225 million in principal amount of the currently $298 million in principal amount outstanding at a repurchase price of $92,000 per $100,000 in principal amount of Existing Convertible Bonds. The aggregate nominal amount of convertible bonds validly tendered pursuant to the Tender Offer was $172,600,000. The Company advised that the Tender Offer would be financed upon the successful completion of a Rights Issue to finance part or all of the amount payable by the Company for the Existing Convertible Bonds accepted for repurchase pursuant to the Tender Offer. On 15 April 2014, the Company announced the issue of up to 976,206,906 Rights Issue Shares to qualifying shareholders. The Rights Issue is on the basis of 2 Rights Issue Shares for every Existing Share held by qualifying shareholders at the close of business on the applicable record date. Subject to certain exceptions, shareholders with a registered address, resident, or otherwise believed to be in the United States, Canada or Japan will not be entitled to participate in the Rights Issue. The Issue Price of A$0.25 represents a discount of approximately 58 per cent to the closing price on the ASX of A$0.59 per Common Share on 11 April 2014. The Issue Price of 14 pence represents a discount of approximately 65 per cent to the closing price on the London Stock Exchange of 40.25 pence per common share on 11 April 2014. The Issue Price of ZAR2.41 represents a discount of approximately 66 per cent to the closing price on the JSE of ZAR7.15 per common share on 11 April 2014. The Rights Issue is expected to raise gross proceeds of up to $225 million through the issuance of up to 976,206,906 new Common Shares (the "Rights Issue Shares"). Assuming all Rights Issue Shares are issued, they will represent approximately 67 per cent of the Enlarged Issued Share Capital. Proceeds raised pursuant to the Rights Issue will be used to fund the settlement of the Tender Offer. In the event the net proceeds of the Rights Issue exceed the amount required to settle the Tender Offer, the Company intends to retain any additional amounts to improve the Aquarius Group's liquidity in order to fund the future redemption of the Existing Convertible Bonds not validly tendered and repurchased pursuant to the Tender Offer on the scheduled redemption date (being 18 December 2015). Subject to the satisfaction or waiver of certain customary conditions, Rand Merchant Bank, a division of FirstRand Bank Limited ("RMB"), Absa Bank Limited, acting through its corporate and investment banking division ("Absa") and Euroz Securities Limited ("Euroz") have agreed to underwrite the subscription of 737,578,551 Rights Issue Shares (less any Rights Issue Shares taken up under the Rights Issue or subscribed for in any rump offering) at ZAR2.41 per Rights Issue Share (in the case of RMB and Absa) and at A$0.25 per Rights Issue Share (in the case of Euroz). As a result, the Company has certainty that it will raise minimum gross proceeds equal to approximately $170 million from the Rights Issue. The latest date for acceptances and payment in full in respect of the Rights Issue is 14 May 2014. Full details of the Tender Offer and Rights Issue can be found at www.aquariusplatinum.com Update on Sale of Assets The company released details of the planned sale of two non-core assets being its interest in the Blue Ridge Mine and its interest in the Kruidfontein prospecting right on 30 January 2014. Work in relation to the fulfilment of the conditions precedent, noted in the releases, continues. Shareholders will be informed of any material developments in this regard as soon as is practical. Statistical information: Kroondal P&SA1 See www.aquariusplatinum.com for statistical information Statistical information: Mimosa See www.aquariusplatinum.com for statistical information Statistical information: Platinum Mile It is not possible to draw any meaningful comparison with the results of the previous quarter as unit costs are materially distorted because of very low feed and production volumes. See www.aquariusplatinum.com for statistical information Aquarius Platinum Limited Incorporated in Bermuda Exempt company number 26290 Board of Directors Nicholas Sibley Non-executive Chairman Jean Nel Chief Executive Officer David Dix Non-executive Tim Freshwater Non-executive (Senior Independent Director) Edward Haslam Non-executive Kofi Morna Non-executive Zwelakhe Mankazana Non-executive Sonja de Bruyn Sebotsa Non-executive Audit/Risk Committee David Dix (Chairman) Tim Freshwater Edward Haslam Kofi Morna Nicholas Sibley Remuneration Committee Edward Haslam (Chairman) David Dix Zwelakhe Mankazana Nicholas Sibley Nomination Committee Sonja de Bruyn Sebotsa (Chairman) Edward Haslam Tim Freshwater Kofi Morna Willi Boehm Company Secretary Willi Boehm AQPSA Management Sonja de Bruyn Sebotsa Non-executive Chairman Robert Schroder Managing Director Jean Nel Executive Director Wessel Phumo General Manager: Kroondal Mimosa Mine Management Winston Chitando Chairman Herbert Mashanyare Technical Director Peter Chimboza Resident Director Fungai Makoni General Manager Finance & Company Secretary Platinum Mile Management Richard Atkinson Managing Director Paul Swart Financial Director Issued capital At 31 March 2014, the Company had on issue: 487,782,536 fully paid common shares. Substantial shareholders 31 March 2014 Number of Shares Percentage Wellington Management Company 40,593,492 8.32 The Capital Group of Companies 37,117,112 7.61 HSBC Custody Nominees (Australia) Limited 28,849,362 5.91 Primary Australian Securities Exchange Trading Information Listing: (AQP.AX) Premium London Stock Exchange (AQP.L) ISIN number BMG0440M1284 Listing: Secondary JSE Limited (AQP.ZA) ADR ISIN number US03840M2089 Listing: Convertible Bond ISIN number XS0470482067 Broker (LSE) (Joint) Broker (ASX) Sponsor (JSE) Liberum Capital Limited Ropemaker Place, Level 12 Euroz Securities Level 18 Alluvion 25 Ropemaker Street, 58 Mounts Bay Road, Rand Merchant Bank London Perth WA 6000 (A division of FirstRand Bank Telephone: +61 (0) 8 Limited) EC2Y 9LY 9488 1400 1 Merchant Place Telephone: +44 (0) Cnr of Rivonia Rd and Fredman 20 3100 2000 Drive, Sandton 2196 Johannesburg South Africa Barclays 5 The North Colonnade Canary Wharf London E14 4BB Telephone: +44 (0) 20 7623 2323 Aquarius Platinum (South Africa) (Proprietary) Ltd 100% owned (Incorporated in the Republic of South Africa) Registration Number 2000/000341/07 1st Floor, Block C, Rosebank Office Park, 181 Jan Smuts Avenue, Rosebank, South Africa Postal Address: PO Box 7840, Centurion, 0046, South Africa Telephone: +27 (0)10 001 2848 Facsimile: +27 (0)12 001 2070 Aquarius Platinum Corporate Services Pty Ltd 100% Owned (Incorporated in Australia) ACN 094 425 555 Level 4, Suite 5, South Shore Centre, 85 The Esplanade, South Perth WA 6151, Australia Postal Address: PO Box 485, South Perth, WA 6951, Australia Telephone: +61 (0)8 9367 5211 Facsimile: +61 (0)8 9367 5233 Email: info@aquariusplatinum.com For further information please visit www.aquariusplatinum.com or contact: In the United Kingdom and South Africa: In Australia: Jean Nel +27 (0)10 001 2848 Willi Boehm +61 (0) 8 9367 5211 Glossary A$ Australian Dollar Aquarius Aquarius Platinum Limited or AQP APS Aquarius Platinum Corporate Services Pty Ltd AQPSA Aquarius Platinum (South Africa) (Pty) Ltd ACS(SA) Aquarius Platinum (SA) Corporate Services (Pty) Ltd BEE Black Economic Empowerment BRPM Blue Ridge Platinum Mine CTRP Chrome Tailings Retreatment Operation. Consortium comprising Aquarius Platinum (SA) (Corporate Services) (Pty) Limited (ASACS), Ivanhoe Nickel and Platinum Limited and Sylvania South Africa (Pty) Ltd (SLVSA). DIFR Disabling injury frequency rate, being the number of lost-time injuries expressed as a rate per 1,000,000 man-hours worked DIIR Disabling injury incidence rate, being the number of lost-time injuries expressed as a rate per 200,000 man-hours worked DME formerly South African Government Department of Minerals and Energy DMR South African Government Department of Mineral Resources, formerly the DME Dollar United States Dollar or $ Everest Everest Platinum Mine Great A PGE-bearing layer within the Great Dyke Complex in Zimbabwe Dyke Reef GoZ Government of Zimbabwe g/t Grams per tonne, measurement unit of grade (1g/t = 1 part per million) JORC Australasian code for reporting of Mineral Resources and Ore Reserves code JSE Johannesburg Stock Exchange Kroondal Kroondal Platinum Mine or P&SA1 at Kroondal LHD Load haul dump machine Marikana Marikana Platinum Mine or P&SA2 at Marikana Mimosa Mimosa Mining Company (Private) Limited nm Not measured pcp previous corresponding period nine months ended 31 March 2013 PGE(s) Platinum group elements plus gold. Five metallic elements commonly (6E) found together which constitute the platinoids (excluding Os (osmium)). These are Pt (platinum), Pd (palladium), Rh (rhodium), Ru (ruthenium), Ir (iridium) plus Au (gold) PGM(s) Platinum group metals plus gold. Aquarius reports PGMs as comprising (4E) Pt+Pd+Rh plus Au (gold) with Pt, Pd and Rh being the most economic platinoids in the UG2 Reef PlatMile Platinum Mile Resources (Pty) Ltd P&SA1 Pooling & Sharing Agreement between AQPSA and RPM Ltd on Kroondal P&SA2 Pooling & Sharing Agreement between AQPSA and RPM Ltd on Marikana R South African Rand Ridge Ridge Mining Limited ROM Run of mine. The ore from mining which is fed to the concentrator plant. This is usually a mixture of UG2 ore and waste. RPM Rustenburg Platinum Mines Limited, a subsidiary of Anglo Platinum Limited Limited Tonne 1 metric tonne (1,000kg) TARP Trigger Action Response Procedure UG2 Reef A PGE-bearing chromite layer within the Critical Zone of the Bushveld Complex




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