Mimosa's revenue increases

Published: 05 May 2014

South Africa-based Aquarius Platinum's Zimbabwean subsidiary, Mimosa Mining Company's revenue increased by 1 percent for the quarter ended March 2014 due to below budget metal recoveries and power outages.

Revenue increased to $63 million from $62 million recorded in the previous quarter.

"Revenue from Mimosa which is included in 'share of profit/loss from joint venture entities' was in line with the previous quarter despite lower production," the company said.

Cash profit margin for the same period increased to 26 percent from 18 percent.

Production for the company decreased by 5 percent to sit at 51 900 ounces from 55 586 ounces recorded in the previous year.

Head grade improved to 3,67 grammes per tonne while recoveries sat at 77,5 percent. PGM production decreased by 7 percent to 51 907 PGM ounces quarter-on-quarter.

"This decrease was due to challenges experienced after the February 2014 plant shutdown. Therefore volumes processed decreased by 9 percent to 568,608 tonnes," the company said.

The total capital expenditure for the third quarter amounted to $6,5 million mainly incurred on mobile equipment, drill rigs, the conveyor belt extension and down dip development.

Stay in business capital expenditure sat at $114 per PGM ounce for the quarter while mining cash costs increased by 9 percent to $81 per tonne.

"Cash costs at Mimosa remained flat for the nine months ended March 31 2014 compared to the quarter-on-quarter costs increase of 7percent," the company said.

Average PGM basket price increased 2 percent quarter-on-quarter in Dollar terms, down 11 percent compared to the quarter ended March 2013.

The South African Rand weakened against the US Dollar by 7 percent on average quarter-on-quarter. Mimosa's operational costs continued to be well maintained at annual increase rates below inflation.

Mimosa's unit costs for the nine months to March 31 2014 remained flat compared to the pcp at $866.

For the quarter under review,

cash cost per PGM ounce was $892 which is a 7 percent increase quarter-on-quarter.

Increase in unit costs was due to reduced PGM production as a result of planned plant modifications, below budget metal recoveries and power outages.

These challenges despite Mimosa's production levels continue to be in line with company guidance.

Mimosa said the board and management team will take responsibility as custodians of capital seriously.

"Management will resolutely continue its focus on disciplined safety, production and cost management as the primary focus. The Board is particularly encouraged and appreciative of the level of support from our largest shareholders who have indicated their support for the restructure," said the company.
- The Herald

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