JOHANNESBURG (miningweekly.com) – Platinum miner Aquarius had “in the face of a very difficult operating, labour, political and social environment”, reported revenue of $186-million for the six months ended December 31.

Group mine earnings before interest, taxes, depreciation and amortisation were $18-million, owing to higher production and improved cost management and higher rand basket selling prices.

Aquarius CEO Jean Nel said the six months was characterised by continued operational progress, improved safety performance, reduced costs and record production for the group. 

In a conference call, he pointed out that both the company’s operating mines were at the lower end of the cost curve.

However, the company had widened its headline loss for the six months under review to $30-million, from a loss of $22-million in the first half of the prior financial year.

Its net loss for the six months was $57-million. 

OPERATIONAL PERFORMANCE
Group attributable production increased by 5% to 343 845 oz for the six months, owing to Kroondal consistently producing at capacity levels, with eight consecutive quarters above 105 000 oz, and the mine’s unit costs having increased by 1% in rand terms, but decreasing 7% in dollar terms, owing to a weaker rand.

In a strategic move, the company disposed of its Kruidfontein prospecting rights for $27-million, while it announced on Tuesday that it would sell its Everest mine to Northam for R450-million.

“Our incremental projects progressed satisfactorily during the half-year and the group’s balance sheet was strengthened following the sale of noncore assets. We continue to expect a difficult operating and metal price environment in the short term, which directs our focus on operational efficiencies and responsible capital stewardship,” the company said.

Total cash cost of production for the year was $97-million, down $7-million, despite a 3% increase in production at Kroondal, owing to good cost control and the weakening rand.

“Maintaining operating unit cost increases well within inflationary targets will continue to be a point of focus, particularly in the ongoing low metal price environment,” the company noted.

Given the continuing low rand platinum group metal basket prices, Marikana would continue to be on care and maintenance, until further notice.

WAY FORWARD
Nel noted that the year ahead was a “good time to think of growth”, but that the company would continue to look at the short-to-medium term operating environment as “very difficult”, not expecting any relief from metal prices.

He noted that the company was looking into two potential growth opportunities, but that Aquarius would continue to be disciplined. “There will be no growth unless the quality of the portfolio is improved and no growth at the expense of margin,” he added.

Aquarius would remain committed to progressing a number of smaller, value-accretive projects including the Kroondal tails project and capacity expansion at its Mimosa mine in Zimbabwe.