Mimosa FY revenue rises to $272mln on record production, platinum miners get Zimbabwe tax reprieve

Mimosa FY revenue rises to $272mln on record production, platinum miners get Zimbabwe tax reprieve

HARARE, August 12 (The Source) – Mimosa Platinum Mine’s revenue for the full-year to June rose five percent to $272 million as it delivered all time record production of over 236,000 ounces of platinum group metals (4E).

Bermuda-headquartered platinum miner, Aquarius Platinum said 4E production at its 50 percent owned Zimbabwe unit was higher at 236,067oz from 221,359oz in the previous year. Platinum output for the year stood at 117,355oz, compared to 110,158oz.   For palladium, output increased to 92,705oz from 87,037oz.

About 118,033 PGM ounces were attributable to Aquarius, with 50 percent partner Impala getting an equal share.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) profit attributable to Aquarius stood at $42 million but the mine suffered a net loss before tax of $5 million after discounting $29 million (on a 50:50 basis) owed by the Reserve Bank of Zimbabwe.

“In view of the difficulty in reliably estimating the time frame to secure full settlement of the RBZ debt, Aquarius has recognised a non-cash expense of $28,5 million in the share of loss from joint ventures, equal to its share of the full amount of the RBZ receivable,” Aquarius said in the financial results released on Wednesday.

South Africa’s Implats Platinum holds the other 50 percent in the platinum miner.

The seven percent increase in production and lower unit costs, which were down by nine percent, helped mitigate the five percent fall in the average PGM basket price, it added.

Aquarius noted that at the release of the financials, the deferral of the 15 percent export tax in Zimbabwe had not been formalised and as a result, had accrued $4,5 million for the year.

However, on Monday the state-owned Herald newspaper reported that Zimbabwe had suspended the 15 percent tax on raw platinum exports after mining companies asked the government to give them two years to set up smelters and refineries.

President Robert Mugabe’s government introduced the levy on unrefined platinum in January to encourage local processing of the metal.

Anglo American Platinum (Amplats) and Impala Platinum also have mines in Zimbabwe, which holds the second-largest reserves of the metal.

Mines Minister Walter Chidhakwa told The Herald, which reflects government thinking, that he had presented the mining companies’ request to defer the tax in a report to Mugabe’s cabinet and the cabinet had accepted it.

“On the strength of that, Cabinet allowed that they (companies) be given two years to implement their plans. We are confident that we will ensure that they do so not only in two years, but even within a shorter period,” Chidhakwa said.

Zimbabwe’s finance minister said last month that platinum production fell 6.4 percent to 5.9 tonnes during the first half of this year, hit by low prices of the metal.

Aquarius said it had received a dividend of $20 million was received from Mimosa and that the mine had cash holdings of $10 million as at June 30.

The mine also paid $3 million to the Zvishavane Community Share Ownership Trust in the year.