Write-downs mar Aquarius Pt record output

[miningmx.com] – AQUARIUS Platinum made a gross profit of $3.5m for the six months to end-December (2014: $7.6m loss), but nearly doubled its net loss to $56.7m ($24m loss) because of non-cash impairment charges and provisions.

Those consisted of a $26m impairment on the carrying value of the Blue Ridge/Sheba’s Ridge investment and a $28.5m provision against RBZ debt receivable in Zimbabwe, but dependant on either an “indigenisation transaction or the creation of treasury bills as contemplated by the Government of Zimbabwe.’

The provision has now been made because Aquarius management does not believe either outcome is likely to occur within “… 12 months of the balance sheet date, despite the progress initiatives underway.’

That aside, Aquarius turned in a good operating performance pushing platinum group metal (pgm) production for the six months to 175,831 oz (168,014 oz) which CEO Jean Nel described as a “record production’ for the group.

“In addition to excellent operating performances by both Kroondal and Mimosa, our incremental projects progressed satisfactorily during the half-year and the group’s balance sheet was strengthened following the sale of non-core assets.

“We continue to expect a difficult operating and metal price environment in the short-term which directs our focus on operational efficiencies and responsible capital stewardship.’

On February 10 Aquarius announced it had agreed to sell the mothballed Everest Mine to Northam Platinum for R450m in cash.

In a separate release, Nel said the cash would be used to strengthen Aquarius’ balance sheet and the disposal was “in line with our stated objective of focussing on our core operations at Kroondal and Mimosa and associated projects.’

He added that Aquarius management’s view was: “… the sale of Everest, which is superfluous to our present business plan, delivers the most appropriate realisation of value from the Everest assets.’

Aquarius shares dipped 1.3% to trade at 230c on the JSE this morning following the release of the interim results.