TORONTO (miningweekly.com) – TSX- and ASX-listed Paladin Energy on Tuesday announced that it had finalised an agreement with MD and CEO John Borshoff to continue in his current capacities at the company until December 31, 2014, with an option for the parties to extend the contract by another year or two.
Paladin said it recognised the critical importance of Borshoff's contribution to the current and continuing strategic negotiations concerning a Langer Heinrich minority interest sale and debt reduction.
The uranium miner early last month announced further cost-cutting measures, including redundancies and executive pay cuts, to combat the declining spot price of uranium.
The Perth-based miner said it had identified $23-million in cash costs that could be cut during the 2014 financial year, including $10.8-million in corporate overhead and exploration costs, and $12.4-million in discretionary capital expenditure. Board and management salaries would also be lowered by 10% during 2014.
The salary cut for Borshoff was in addition to the 25% reduction previously announced. All bonus plans have also been suspended and salaries have been frozen until the uranium price improved.
Paladin on Tuesday said that if at any time during Borshoff’s term the month-end uranium spot price equals or exceeds $45/lb for a period of three consecutive months, and Borshoff achieves other key strategic objectives, his base salary would be reinstated to $1.53-million, including superannuation.
Paladin flagged its first cost-cutting measures in November last year, telling shareholders at the time that it would reduce operating costs by between $60-million and $80-million over the next two years.
The most significant cost savings would come from the Langer Heinrich mine, in Namibia, and the Kayelekera operation, in Malawi, as full production was achieved at both operations.