Zimplats revenue up 80%

Published: 02 February 2018

Zimbabwe's largest platinum producer Zimplats Holdings Limited's revenue for the quarter ended December 30, 2017 jumped 80 percent to $184 million from the previous quarter on the back of sale of concentrates accumulated from the previous quarter.

Zimplats also attributed the growth to a 4 percent increase in the basket price of the metals sold. Gross revenue per four elements (4E) ounce rose 4 percent from the previous quarter.

Platinum was the biggest revenue contributor at $68 million, which was 6 percent above same period last year. Palladium contributed $67,7 million, a 92 percent increase from the previous quarter and 60 percent year-on-year. Overall, the 4E metals total revenue for the quarter rose 32 percent to $159 million compared to $121 million achieved in the comparable quarter last year.

Net operating costs increased by 84 percent to $138 million. Profit from operations before royalties amounted to $45 million which was 70 percent above previous quarter. Zimplats paid $4 million in royalties resulting in profit from operations after royalties amounting to $40 million.

"Royalty and commission expenses increased by 76 percent from the previous quarter in line with the increase in revenue," said Zimplats.

4E comprise of platinum, palladium, gold and rhodium and production in final product decreased by 2 percent from previous quarter. During the quarter tonnes mined increased 2 percent to 1 767 from the previous quarter on the back of a ramp up production from the Bimha Mine coupled with improved performance at South Pit Mine.

However, there was a 3 percent decrease in tonnes milled due to a seven day mill reline shutdown at the Selous Metallurgical Complex concentrator.

"The furnace, which was switched back on in October 2017 after a successful planned 46-day sidewall reline shutdown, smelted 32 009 tonnes of concentrate, up from 22 654 tonnes smelted in the previous quarter.

"Overall, 4E metal production in final product decreased by 2 percent from the previous quarter mainly due to the decrease in the volume of ore milled," said Zimplats.

Concentrates produced and stockpiled during the furnace shutdown in the previous quarter were exported during the quarter under review. Net operating costs increased 84 percent compared to the previous quarter largely due to the increase in 4E sales volumes, an increase in selling expenses arising from the export of concentrate stockpiled in the previous quarter and an increase in smelter costs in line with increased running time.

Meanwhile, the Bimha Mine re-development and Mupani Mine development projects are on schedule. Bimha is to reach its full production by April 2018 while Mupani Mine, which replaced Ngwarati and Rukodzi mines remains on schedule targeting ore contact by May 2020 and full production by August 2025.

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