JAMES Campbell has resigned from Rockwell Diamonds where he was CEO for about five-and-a-half years following a strategic review of the business which focused on the firm’s positioning and its $21.9m Remhoogte acquisition.
The Toronto- and Johannesburg-listed alluvial diamond miner announced today that Campbell would be replaced by Tjaart Willemse, a newly appointed executive officer. Rockwell mines in the Middle Orange River region of the Northern Cape, an inhospitable and remote location where rival miners, such as Trans Hex, have had a mixed performance.
Willemse’s role, however, appears somewhat limited in that he would function as CEO for “day-to-day operations and plant completion” whilst reporting to the chairman, Mark Bristow. Campbell would remain a director of Rockwell, but relinquishes the office keys in November.
Rockwell said in its statement that a strategic review undertaken by a special board committee on August 28 aimed at evaluating “… the positioning of Rockwell in the diamond mining space, as well as the effectiveness of defined strategies that were implemented over the past period by the company”.
The review included the performance of its Remhoogte acquisition which Rockwell said was “below plan” and the construction of the new Wouterspan plant which was “behind schedule with a higher cost”. The review also followed the recent exit of two senior managers.
The board’s committee concluded that “… further intervention on operations and plant completion was necessary, while new opportunities are being assessed”.
It added that “… the first phase of the wet plant at Wouterspan, being the first two of four circuits is substantially complete and diamond grades are in line with expectations”.
Rockwell has struggled to turn a profit for large periods of Campbell’s term which has been characterised in its last few years by restructuring and acquisitions.
In the past 18 months, the company placed its Niewejaarskraal operation on care and maintenance whilst selling another, Tirisano. It then bought the Remhoogte/Holsloot project whilst retaining Saxendrift, a mine that had been under pressure, which was operating at a reduced rate and grade.
The commissioning difficulties of Remhoogte appear to turn on understanding the types of gravels that it would be processing compared to its resource assessment prior to the project acquisition.
At the end of Rockwell’s fourth quarter, the firm’s auditors attached a note regarding it as a going concern saying that
the completion of the new mining strategy and the timely ramp up of Wouterspan were risks.
Shares in the company were unchanged on the Johannesburg Stock Exchange today following the announcement. However, they are 87% higher in the last six months. The company is capitalised at about R82.5m.
In developments unrelated to the resignation of Campbell, two other board members – Rick Menell and Stephen Dietrich – have tendered their resignation from the board. Menell cited work load whilst Dietrich had resigned owing to ill health.
They would be replaced by Richard Mhlontlo who will represent Rockwell’s Black Economic Empowerment shareholder. Mhlontlo was previously group human resource and industrial relations manager for Rockwell.