JOHANNESBURG (miningweekly.com) – The ASX-, LSE- and JSE-listed platinum miner Aquarius Platinum has taken a $160-million impairment knock on its currency-hit Blue Ridge Platinum Mine.

The Blue Ridge impairment and also the Marikana Shaft One closure marred what was otherwise a solid year for Aquarius’ three main South African mines and one Zimbabwean operation.

CEO Stuart Murray reported a 45% rise in dollar revenue for the year to June 30 to $682-million on the back of improving US dollar prices for the company’s platinum-up metals and a 15% rise in production to 487 404 platinum-group ounces for the full year.

He is guiding production of 550 000 oz in the 2012 financial year.

Earnings before interest, tax, depreciation and amortisation increased by 40% to $203-million and headline earnings rose fivefold to $143-million.

Mine operating net cash flow increased by 44% to $162-million.

The dividend was maintained for the second half taking the full-year dividend to US8c a share, representing a 2.5% yield.

“We’re neither upbeat nor downbeat. We think that things are going to amble along,” said Murray in a conference call.

What knocked the company was its decision to write down the carrying value of the Blue Ridge mine, which ceased operations in the fourth quarter.

This has resulted in a $160-million writing down of its asset value, which has resulted in an accounting loss of $10-million.

Blue Ridge Platinum, which as at end-June 2010 employed 1 665 employees of which 1 651 were contractors, is a 50:50 partnership between Aquarius and the black economic-empowerment company Imbani Platinum.

“The impairment of Blue Ridge represents a fitting conclusion to what must have been two long years of battling with this mine,” Evolution Securities Louise Collinge commented.

Aquarius’ weighted average on-mine unit cash costs in South Africa increased by 12% in rand terms and Mimosa on-mine unit cash costs in Zimbabwe rose 14% as a result of challenging ground conditions and significant industry collective bargaining wage settlements.

The Everest mine in South Africa is ramping up and the mined-out Marikana openpit has been closed.

Safer hangingwall support methodology is being implemented in Aquarius’ South African mines following a Marikana accident which killed five people last year.

“We’re implementing support standards and methodologies that would not go amiss in a mine in Canada or the USA,” Murray commented.

The remaining three deaths in the period were described as behaviour-based.

Murray said that behaviour-based accidents were becoming the single biggest challenge in South African mining.

To counter criticism of the relatively short mine lives within the Aquarius stable, the company has acquired assets that give the company more flexibility and mine-life extension.

The company acquired Afarak Platinum for $109-million to facilitate life extensions at Kroondal and Marikana and has agreed to acquire Booysendal South for $180-million to extend Everest.

The Afarak and Booysendal South transactions have the capacity to increase Aquarius resources by some 50%

The company is also to acquire a further 41.7% of the on-surface Platinum Mile operation for $17-million, raising ownership in that asset to 91.7%

Murray said that exchange rate movements continued to have a volatile effect on earnings with a $66-million foreign-exchange (forex) gain recorded in the first six months, followed by a $6-million forex loss recorded in the second half of the financial year.

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