Aim-listed platinum group metals (PGMs) miner Sylvania Platinum’s dump operations (SDO) produced 16 289 oz in the fourth quarter of its financial year ended June 30, which is slightly lower than the 17 420 oz produced in the third quarter.
The miner notes that production was in line with its projections for the quarter.
It also took the SDO production to 70 043 oz of PGMs for the financial year, with full-year output slightly higher than expected.
Sylvania’s revenue for the fourth quarter, however, decreased by 20% quarter-on-quarter to $44.1-million, as a result of both the moderately lower ounce production and the significant reduction in the realised basket price quarter-on-quarter.
The gross basket metals price for the quarter also decreased by 11%, from $4 576/oz in the third quarter, to $4 059/oz in the fourth quarter, mainly owing to the 19% and 5% drop in rhodium and platinum prices received, respectively.
This resulted in Sylvania’s group cash balance decreasing slightly, from $102.1-million in the third quarter to $101.1-million during the fourth.
Cash generated from operations before working capital movements was $29-million, with net changes in working capital amounting to $14.7-million, which is mainly a result of the change in trade debtors.
The miner’s group cash costs per PGM ounce increased by 15%, from R11 571/oz ($773/oz) to R13 302/oz ($941/oz); while group earnings before interest, taxes, depreciation and amortisation decreased from $58.7-million to $28.7-million.
Net profit also decreased from $41.3-million in the third quarter to $14.7-million in the fourth quarter, as a result of the lower ounces produced and the lower basket price achieved.
The group remains debt free and continues to maintain strong cash reserves, which it says enables the funding of capital expansion and process enhancement projects.
Sylvania’s PGM feed tonnes increased by 2% quarter-on-quarter, with most plants achieving higher-than-planned treatment rates during the period under review.
The treatment of run-of-mine (RoM) material increased by about 55% as the supply to both the Mooinooi and Lannex operations by the host mines have improved significantly during the period under review.
Further, both the 4% decrease in PGMs feed grade and the 3% decrease in PGMs recovery efficiency, compared with the previous quarter, were largely associated with the significant increase in opencast RoM material treated at Mooinooi and Lannex.
The miner notes that opencast material was typically more oxidised and had a lower PGMs grade and recovery potential than current dump sources.
Based on the current plant feed sources and going forward, Sylvania’s philosophy is to ensure that operations balance PGM recoveries against mass pull and concentrate quality, with PGMs recovery expected to remain in the 52% to 54% range during the 2022 financial year.
Sylvania CEO Jaco Prinsloo says the record profits realised in the third quarter of the financial year were boosted by the spike in the price of rhodium and its effect on Sylvania’s basket price, but the company has seen a pull-back in the rhodium price in recent months.
In terms of the impact of the Covid-19 pandemic, Prinsloo says Sylvania continues its efforts to moderate the effects of the virus on its employees.
Meanwhile, in terms of the mid-July civil unrest in KwaZulu-Natal and Gauteng, he says Sylvania’s board acknowledges the situation may have been unsettling for investors, as it has been for most South Africans.
“Fortunately, none of our operations were impacted by this unrest and, although the earlier protests were not in the provinces where our operations are located, management still continues to monitor the situation closely, particularly from a supply chain point of view.”