Aim-listed Sylvania Platinum reported a significant increase in revenue, adjusted group earnings and net profit for the financial year ended June 30, despite the Covid-19-related hard lockdown in South Africa in March and April.

The company’s Sylvania Dump Operations (SDO), in South Africa’s Bushveld Complex, produced 69 026 oz of platinum, palladium, rhodium and gold (4E PGMs) for the year, which was 4% lower than the 72 090 oz produced in the year ended June 30, 2019.

The company lost about 10 000 oz of output owing to the Covid-19 lockdown in South Africa.

The SDO comprises six chrome beneficiation and PGM processing plants, located on both the eastern and western limbs of the Bushveld Complex, treating a combination of current and historical chrome tailings at host-mine sites.

Sylvania’s net revenue increased by 62% year-on-year to $114-million, while adjusted group earnings before interest, taxes, depreciation and amortisation increased by 130% year-on-year to almost $70-million, from $30.2-million in the prior year.

The company’s net profit increased by 125% to $41-million in the year under review, compared with a net profit of $18.2-million posted in the prior year.

Basic earnings a share increased by 130% year-on-year to $0.14, compared with basic earnings a share of $0.06 reported for the 2019 financial year.

Sylvania’s board declared a cash dividend of 1.60p apiece for the year under review.

The company has a cash balance of $56-million with no debt and no pipeline financing.

Meanwhile, water constraints at the operations, particularly the western limb operations, continued to present some challenges in the reporting period, with research into the reduction in water losses and consumption, as well as alternative measures to supplement water supply to operations being a key focus of the group, and starting to yield positive results during the second half of the year.

The company advises that utility infrastructure and power supply also continued to present challenges to existing operations and the execution of expansion projects.

Current depressed chrome market and associated retrenchments at the host mine – which resulted in production cuts at some of their mining operations on the eastern and western limbs – impacted on the total run-of-mine output and current arisings volumes at some operations and this will continue into the foreseeable future.

On a positive note, Sylvania’s Mooinooi optimisation project, incorporating proprietary processing modifications, is on schedule for commissioning during the first half of next year.

The company’s new Lannex mill, as part of the Lannex plant life-extension project was completed during the year, despite an initial delay owing to Covid-19 which delayed the delivery of the mill from China.

Sylvania says that a new secondary milling and flotation module, similar to the existing Project Echo modules, had been initiated at the Lesedi project during the year and is on track for commissioning during 2022.  

The company continues to evaluate potential open cast mining material from host mines as alternative feed sources to substitute some of the lost underground run-of-mine production.

Moreover, Sylvania is advancing research and development of its chrome/coal pelletising joint operation project, while reviewing the most suitable execution strategies for exploration at the Volspruit and Northern Limb areas of the Bushveld Complex around the SDO.

CEO Jaco Prinsloo, who was appointed in March after Terry McConnachie retired, expects the Sylvania team to deliver on an expected production target of about 70 000 oz of 4E PGMS for the 2021 financial year.