Wesizwe’s headline loss widens, financial constraints persist
JSE-listed Wesizwe Platinum’s headline loss a share widened to 8.24c in the year ended December 31, compared with a headline loss a share of 1.48c in 2021.
The board has again decided not to declare a dividend for the year, as its loss for the year amounts to R134-million, significantly higher than the R24-million loss reported in 2021.
Notably, Wesizwe’s administration expenditure increased by 66% year-on-year to R62-million in the year under review, compared with R37-million in the prior year.
Wesizwe advises that its cash on hand of R224-million, as of December 31, is insufficient to carry the company forward, to conduct operations and develop the Bakubung platinum mine up to the end of this year.
The group’s current liabilities, including shareholders’ loans of R5.7-billion, exceed the current assets.
Wesizwe states that its ability to continue as a going concern is dependent on the support of the company’s majority shareholder and it not calling on the current loans. Fortunately, this shareholder has supported the shortfall on repayments to date, having provided a letter of comfort.
Management has made certain judgements in considering whether the planned mitigating actions are sufficient to conclude that the going concern assumption is appropriate.
Wesizwe has been experiencing delays to the construction of its underground Bakubung mine, including community protests early in 2022 and funding shortages.
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