AQP.L Regulatory News (AQP)

AQUARIUS PLATINUM LIMITED - 2013 Half Year Financial Results to 31 Dec 2012

PR Newswire

London, February 8

Key Points: Financial

Revenue decreased by 29% to $179 million (H1 2012: $252 million)

Mine operating net cash flow decreased by $63 million to a $38 million outflow(H1 2012: inflow of $25 million)

Mine EBITDA decreased by 24% to $22 million (H1 2012: $29 million)

Group cash balance at period end of $83 million

Key Points: Operational

Group attributable production decreased by 27% to 156,787 PGM ounces (H1 2012:215,453 PGM ounces)

Attributable production from operating mines increased by 8% compared to theprevious corresponding period (pcp)

The average US Dollar PGM Basket Price was 10% lower compared to the pcp

The average Rand Basket Price increased by 1% compared to the pcp due to aweaker Rand

The Rand weakened by 12% on average against the US Dollar

On-mine unit cash costs in South Africa increased by 3% in Rand terms

Mimosa performed strongly again, continuing to produce at capacity

Operations at Blue Ridge, Marikana, Everest and CTRP remained suspended

Key Points: Strategic

Transition to owner operator completed during the period, on time and belowbudget

Rollout of revised hanging wall system completed during the period, on time andbelow budget

Mimosa and Government of Zimbabwe agreed commercial terms on indigenisation andsigned a term sheet

Commenting on the results, Jean Nel, CEO of Aquarius Platinum said:

The period under review was one of the most challenging in the history of thecompany. Industrial relations in the southern African mining industry, and inparticular the platinum sector, were volatile and strained throughout theentire period, whilst at the same time, platinum group metal prices remainedlow.

In South Africa, the Aquarius management team persisted with its focus onrestoring operational credibility at the Kroondal mine. In this regard I ampleased to report that both of the significant processes we committed to, beingthe migration to owner operator and the implementation of the revised hangingwall support regime, were completed on time and below budget. Theimplementation of these two initiatives, combined with a focussed and motivatedwork force at Kroondal contributed to Kroondal's production improving by 11%relative to the pcp whilst unit costs only increased by 3%. Given the macroenvironment this was a pleasing performance which would not have been possiblewithout a motivated effort by the entire Kroondal work force.

At Mimosa the solid production performance continued, with the conclusion ofthe indigenisation term sheet between Mimosa and the Government of Zimbabwe,particularly pleasing. The Mimosa management team is currently focused onaddressing the high cost inflation being experienced at Mimosa.

The satisfactory operational improvements notwithstanding, Aquarius remainsacutely aware that despite the improvements, the company continued to consumecash during the period. The metal price improvements and weakened Rand/Dollarexchange rate in January 2013 combined with the fact that the once-off costsassociated with the two aforementioned processes and the closure of theMarikana and Everest mines are now completed, is expected to substantiallyreduce cash consumption and enable the company to start producing cash at minelevel.

From a PGM supply and demand perspective there seems to be consensus that bothplatinum and palladium will move into primary supply deficit during 2013.Whilst encouraging the increase in recycling, the continued depressed demandfrom European auto producers and the substantial above ground inventoriesrenders significant further short term price increases unlikely.

In summary, despite the significant operational improvements delivered duringthe period, cash generation at current spot prices remains constrained. It isagainst this backdrop that Aquarius will continue to focus on operationalimprovements and cash preservation whilst remaining committed to improving thequality of life of the communities surrounding its operations.

Aquarius Group attributable production (PGM ounces) - twelve months to 31December 2012

[See www.aquariusplatinum.com for graph]

Production

Total production from all Aquarius operations for the six months to December2012 was 308,954 PGM ounces, representing a 20% decrease compared to the periodended December 2011 (the previous corresponding period or "pcp"). Productionattributable to Aquarius fell by 27% to 156,787 PGM ounces for the period underreview when compared to the pcp following the Everest and Marikana mines beingplaced on care and maintenance in May/June 2012. Significantly, continuingoperating mines Kroondal and Mimosa recorded increased production compared tothe pcp of 11% and 5% respectively. Gains recorded at Kroondal wereattributable to the move from contractor to owner operator and also thesuccessful implementation of a revised support system, both completed in theDecember 2012 quarter.

Production by Mine and Attributable to Aquarius

The chart below illustrates the impact on production of each of the operationsdemonstrating the lower production caused by the placing of Everest andMarikana on care and maintenance and also the improved production recorded bycontinuing mines Kroondal and Mimosa. The most significant factor is theincreased production recorded at Kroondal during what has been regretfully, oneof the most disrupted and hostile periods in the sector. AQPSA who manage theKroondal operations engaged extensively with its workforce, the localcommunities and regulators to build a workable solution to the ongoing regionalindustrial unrest.

[See www.aquariusplatinum.com for chart]

Rand Dollar Exchange Rate

The average Rand-Dollar exchange rate weakened during the half-year, falling by14% from R7.60 in the pcp to R8.65 to the US dollar. Since then, it hasaveraged 8.78 in the month of January.

The average Rand basket price achieved for the half-year was marginally up atR10,262 compared to R10,185 in the pcp. Rand weakness contributed to the Randbasket price remaining stable compared to US Dollar prices which had decreased10% from the corresponding period, December 2011, to $1,211. Subsequent to theend of the half-year, the PGM basket price has consolidated to average R11,347per PGM ounce in January 2013.

[See www.aquariusplatinum.com for graph]

Market Summary

The price of the PGM basket recovered strongly in the first half of the periodunder review triggered by supply disruptions at South African platinum minesfrom illegal strike action. Market sentiment for the PGM basket in dollarterms had improved because of deteriorating supply expectations, a consequenceof the ongoing and severe labour disruptions in SA which led to risingexpectations of shaft closures, project deferrals and increased costs. At thebeginning of the second quarter the PGM Rand basket price continued to rise aspersistent illegal strikes triggered concerns for both future supply of PGMsand how it will impact the overall South African economy. The pessimism onsupply did not last long as the basket price peaked at R12,398 per oz inmid-October (from a trough R9,525 per oz in mid-August) at which point the US$dollar metal prices began to retreat. By the end of October, platinum andpalladium were both trading at two-month lows. PGM prices were supported by thepublication of Johnson Matthey's Platinum 2012 Interim Review highlighting aglobal deficit in platinum as a result of reduced supply from South Africa anda decline in open-loop recycling. However, resolutions to illegal strikeactivity in the region, together with negative news surrounding the euro zoneeconomy and investor nervousness over the US fiscal cliff at the end of theperiod weighed on PGM prices and resulted in a disappointing end to a difficultsix months.

The average platinum price decreased by 6.1%, while palladium decreased by 8.5%and rhodium decreased by 34.2% compared to the pcp. Gold reduced by 0.4% onaverage. Platinum closed the half-year down 3.8% at $1,589 per ounce, whilepalladium remained stable at $691 per ounce and rhodium fell by 38% to $1,040over the same period. Gold fell 0.3% to $1,688 per ounce. Subsequent to theend of the current half-year under review, platinum has averaged $1,637 inJanuary, while palladium rose 2.75% to $711 and rhodium rose by 10% to $1,157in the same period. Gold fell 1% to $1,670 per ounce.

[See www.aquariusplatinum.com for graph]

Financial results: Half-Year to 31 December 2012

Aquarius' consolidated result for the half-year ended 31 December 2012 was aloss of $184 million (38.57 cents per share). The result includes animpairment charge of $127 million arising substantially from a review of thecarrying value of non-operating assets, namely Marikana, Ridge Mining, Platmileand several mining rights.

Profitability at mine level (on-mine EBITDA) was $22 million compared to $29million in the previous corresponding period (pcp) due to challenging operatingconditions experienced at the Group's South African operations, increasedmining costs and lower PGM metal prices. Decreasing metal prices caused anegative sales adjustment to be incurred.

Group attributable mine production for the half-year was 156,787 PGM ounces. This was 58,666 PGM ounces (27%) lower compared to the pcp due to the closureof the Everest and Marikana mines.

Revenue (PGM sales and interest) for the half-year to December 2011 was $179million, 29% lower compared to the pcp due to lower production and lower PGMmetal prices. The revenue received per PGM ounce for the half-year was $1,211,down 10% from the pcp.

Group Financials by Operation

processing & (99.7) (2.3) (1.5) (47.5) (3.8) (0.4) (0.7) (0.1) (156.1)

Group gross cash margin increased to 13% from 6% in the pcp due to the closureof loss operating mines Marikana and Everest.

Total cash cost of production was $156 million, down $80 million due to lowerproduction following the closure of high costs mines Marikana and Everest. Ona per PGM ounce basis this represented a 9% decrease per ounce. Finance costsof $16 million included $9 million interest on convertible bonds and bankborrowings, $5 million of non-cash interest arising from the unwinding of theequity portion of the convertible bond and $2 million of non-cash interestarising from the unwinding of the net present value of the rehabilitationprovisions of AQPSA.

During the half-year Aquarius recorded net foreign exchange losses of $20million.

The income tax benefit of $8 million includes $11 million movement in thedeferred tax credit offset by $2 million normal tax and $1 million withholdingtax.

Attributable Production (PGM Ounces) 156,787 215,453 411,398

Notes on the Consolidated Income Statement

Revenue decreased as a result of lower production and a 3% decrease in the USDollar PGM basket price compared to the pcp.

The 9% decrease in cost of sales on a unit cost basis reflects the closure ofhigh costs mines Marikana and Everest.

Relates to administration costs of the Aquarius Group inclusive of costsassociated with business development activities, legal and financial advisoryexpenses.

Net foreign exchange (FX) loss includes a $24 million loss on currencycontracts, as well as gains/losses on cash, intercompany loans, pipelinedebtors and sales adjustments due to the movement of the Dollar against othercurrencies.

Finance costs include $9 million interest on convertible bonds and bankborrowings, $5 million of non-cash interest arising from the unwinding of theequity portion of the convertible bond and $2 million in non-cash interestarising from the unwinding of the net present value of the rehabilitationprovisions of AQPSA.

Income tax benefit includes an $11 million deferred tax credit offset by $2million normal tax and $1 million withholding tax.

Net operating cash (outflow)/inflow (i) (38,465) 24,948 26,356

Exchange rate movement on cash (iv) 4,734 (19,333) (19,747)

Notes on the Consolidated Cash Flow Statement

Net operating cash flow includes a $182 million inflow from sales, closure andtransition costs of $21 million, $199 million paid to suppliers, interestincome of $3 million and income tax paid of $3 million.

Reflects payments for property, plant & equipment and mine development costs

Includes $24 million paid for closure of currency contract, $8 million interestpaid and $4 million repayment of borrowings

Reflects movement of other currencies against the Dollar.

Non-current interest-bearing liabilities (ix) 265,101 259,408 265,526

Notes on the Consolidated Balance Sheet

Reflects debtors receivable on PGM concentrate sales.

Reflects PGM concentrate inventory, reef stockpiles and consumables stores.

Represents plant and equipment within the Group.

Mining assets relate to Kroondal, Marikana, Everest and Mimosa mine propertiesand mine development.

Includes the recoverable portion of rehabilitation provision from AngloPlatinum of $11 million, receivable from the Reserve Bank of Zimbabwe (RBZ) of$28 million, receivable from outside shareholders of Blue Ridge and Sheba'sRidge of $25 million, investments in rehabilitation trusts of $18 million andinvestments held for resale of $3 million.

Includes intangibles relating to contract value acquired on the acquisition ofequity interest in Platinum Mile Resources (Pty) Ltd.

Includes creditors and other payables of $46 million, DBSA and IDC loans atBlue Ridge of $28 million, AQPSA equipment leases of $6 million, Mimosa bankloans of $4 million and provisions of $6 million.

Includes rehabilitation obligations on P&SA1 and P&SA2 structures.

Includes convertible notes of $262 million and AQPSA equipment leases of $3million.

Includes deferred tax liabilities of $85 million and provision for closurecosts of $43 million.

Minority interests reflects 8.3% outside equity interest of Platmile Resources(Pty) Ltd.

Operating Review Summary (all numbers on 100% basis)

...

This section contains summarised operating reviews of each of the Company'soperations. Full operating statistics are provided on page 15 of this report. In addition, further detail on each of the operations can be obtained from thequarterly and full-year reports released by the Company throughout thefinancial year available on the Company's website, www.aquariusplatinum.com.

AQUARIUS PLATINUM (SOUTH AFRICA) (PTY) LTD (Aquarius Platinum - 100%)

P&SA 1 at Kroondal (Aquarius Platinum - 50%)

12-month rolling average DIIR deteriorated to 1.39 per 200,000 man hours

Production increased by 6% to 3,137,000 tonnes

Head grade increased from 2.38 g/t to 2.45 g/t

Recoveries improved slightly to 80%

Volumes processed increased by 5% to 3,099,000 tonnes

Stockpiles at the end of the period totalled approximately 75,000 tonnes

PGM production increased by 11% to 194,598 PGM ounces

Revenue increased by 28% to R1,804 million due to improved production andbasket price

Mining cash costs increased by 8% to R546 per tonne, and costs per PGM ounce by3% to R8,688

Kroondal's cash margin for the period increased from -6% to 6%

Commentary

Safety, Health and Environment

No fatalities occurred at Kroondal Mine during the period under review. TheDisabling Injury Incident Rate deteriorated to 1.39 due mainly to theuncertainty around the owner operate transition. Currently the total KroondalOperation is standing at 1.2 million fatality-free shifts.

Operations

The transition from Contract mining to Owner Operate was successfully completedduring the period. The mine production after the introduction and theimplementation of the bolters and the change in the support regime hasincreased and trending to steady state levels.

Although there were visits from the inspectorate the number of section 54stoppages reduced significantly during the period in review with only twosection 54 stoppages issued, one each at both Simunye and Kopaneng shaftsduring this period under review prompted by accidents that operationsexperienced.

Some of the infrastructure improvement projects completed which have positivelycontributed to the increase in production include a bunker, conveyor beltinfrastructure and raisebore holes to improve ventilation at various shafts.

From an industrial relations perspective the period under review was anextremely difficult time across the entire Rustenburg region with all minesexperiencing labour strikes in some form and significant levels of intimidationoccurred throughout the period. The impact on the Kroondal shafts was far lessthan the surrounding mines due to the positive attitude shown by all ouremployees.

That being said, employees working at Kwezi went on strike at the start of theperiod under review and more than 15 production days were lost in July. Theseemployees were dismissed and workers from Marikana 4 shaft were transferred toKwezi.

Marikana: As disclosed previously, as a result of current low Rand PGM basketprices, the mine and processing plant have been placed on care and maintenanceuntil further notice.

Everest: As disclosed previously, as a result of current low Rand PGM basketprices and unstable labour relations, the Everest mine has been placed on careand maintenance until further notice.

AQPSA Operating costs per ounce (R)

Capital expenditure (100% basis)

(R'000 unless otherwise stated) Total Per 4E oz

Kroondal mine: reconciliation of cash costs per 4E ounce

Ongoing capital expenditure & mobile equipment (1,142)

MIMOSA INVESTMENTS (Aquarius Platinum - 50%)

Mimosa Platinum Mine

12-month rolling average DIIR deteriorated 0.16 per 200,000 man hours

Production increased by 4% to 1,231,000 tonnes

Head grade improved by 1% to 3.67 g/t

Recoveries remained static at 78%

Volumes processed increased by 4% to 1,192,000 tonnes

Stockpiles at the end of the period totalled approximately 123,191 tonnes

PGM production increased by 5% to 109,093 PGM ounces

Revenue decreased by 13% to $127 million due to depressed metal prices

Mining cash costs increased by 18% to $79 per tonne and costs per PGM ounce by17% to $863

Stay-in-business capital expenditure was $167 per PGM ounce for the period

Mimosa's cash margin for the period fell from 46% to 16% due to depressed metalprices and increased costs.

Commentary

Safety, Health and Environment

No fatalities occurred at Mimosa during the period under review. The DisablingInjury Incidence Rate remained low and stable.

Operations

Mimosa continued to operate at capacity during the period under review,although some production disruption was caused in the latter months of thehalf-year by power outages as well as surface electrical breakdowns.

Stay-in-business capital expenditure for the period amounted to $18 million.Expenditure was mainly incurred in mobile equipment, Drill Rigs and LHD,Conveyor belt extension, Down dip Development and Housing project.

Operating Cash Costs

The unacceptable 17% increase in unit costs at Mimosa was primarily the resultof $1.3 million in surface rentals, consumable inventory write-down of $2.2million, the rebuilding of stockpiles following the fire of $1.4 million andthe increased usage of reagents of $1.0 million. The stockpile rebuilding wascompleted in December and the reagents will be fully depleted by the end of thefinancial year. Excluding the above items unit cost still rose by the expected9% in line with inflation.

Operating cash costs per ounce

Indigenisation and Economic Empowerment

Discussions on indigenisation were concluded in December 2012 and thisculminated in the signing of a term sheet on 14 December 2012. The term sheetsets out the key details of the indigenisation plan and paves the way for thedrafting of detailed agreements that will facilitate the implementation of theplan. It is envisaged that all agreements will be finalised by the end ofMarch 2013.

TAILINGS OPERATIONS

Platinum Mile (Aquarius Platinum - 91.7%) (consolidated - 100% attributable)

Material processed decreased by 40% to 1,519 tonnes

Head grade increased by 35% to 0.69 g/t

Recoveries decreased by 19% to 13%

Production decreased by 28% to 4,619 PGM ounces

Cash costs decreased by 10% to R6,305 per PGM ounce

Revenue was R41 million for the period

The cash margin for the period was 29%, up from 16% in the previous period

The operation remains on care and maintenance since 6 August 2012.

Platinum Mile

During the half-year the results were significantly impacted by strikes atAnglo Platinum in October and November. For this reason the operation lost 13production days in September and virtually the whole of October and November2012. The strikes continued into early December 2012 when production resumedto normal. Whilst the results for the half-year were impacted by these strikes,encouragingly a positive cash margin was achieved despite these tryingcircumstances. The recently announced restructure at Anglo Platinum is notexpected to materially impact the operations of Platinum Mile as it continuesto treat only tails from the Merensky concentrator.

Operating cash costs per ounce

[See www.aquariusplatinum.com for Statistical Information]

Note: CTRP reported only for Q1 FY2013

CORPORATE MATTERS

Issue of Shares to Support Black Economic Empowerment (BEE) Partners

As previously announced, in October 2012 the Company issued and allotted14,000,000 fully paid common shares of US$0.05 at a price per share of 41.75pence (A$0.64) as part of a transaction intended to preserve the black economicempowerment ("BEE") credentials of Aquarius. The Board of Aquarius resolvedthat it was in the interests of Aquarius, and in line with its ongoingcommitment to comply with the BEE and regulatory framework in South Africa, toassist the BEE Partners to preserve their remaining shareholding in Aquarius.

The limited guarantee and pledge provided to the BEE Partners' financiers wasreleased in January 2013. These shares are currently held as Treasury andneither Aquarius' BEE partners nor their financiers have any further recourseto these shares.

Aquarius' full announcement released to the market on 4 October 2012 outliningdetails of the transaction is available on Aquarius' website.

Mimosa Indigenisation

On 14 December 2012, Mimosa Investment Holdings ("Mimosa Investments"), whichis held jointly in a 50:50 partnership with Impala Platinum Holdings Limited,concluded a term sheet in respect of a proposed indigenisation implementationplan ("IIP") with the Government of Zimbabwe. The term sheet provides for thekey terms, subject to certain conditions precedent, of the sale by MimosaInvestments of an aggregate 51% equity ownership of Mimosa Holdings (Private)Limited ("Mimosa Holdings") to indigenous parties for US$550 million (50%attributable to Aquarius), based on an agreed fair market value for MimosaHoldings of US$1.078 billion.

Mimosa Investments will provide a vendor loan funding mechanism to facilitatethe transaction which has a term of ten years. This loan will bear interest ata rate of 9% annually and will be settled through the waiver of the right toreceive 90% of dividends due to the indigenous entities in favour of MimosaInvestments. Any loan balance outstanding at the end of the ten-year periodwill be payable in cash.

Aquarius' full announcement of 14 December 2012 outlines details of theindigenisation plan and is available on Aquarius' website.

Potential acquisition of the Booysendal reserve

The Company remains in communication with the Department of Mining andResources ("DMR") in South Africa in relation to the outstanding approval fromthe DMR required to implement this transaction. In the event of the approvalbeing granted before the end of April 2013 by which date the agreement lapsesthe Company will advise shareholders accordingly.

Aquarius' full announcement of 4 May 2011, outlines details of this transactionand is available on Aquarius' website.

Board Changes

Mr Stuart Murray resigned as director and CEO of Aquarius and executivechairman of AQPSA in October 2012. Mr Jean Nel was appointed Chief ExecutiveOfficer of the Group on 5 November 2012 and Mr Zwelakhe Mankazana,Non-executive Chairman of AQPSA. Sir William Purves retired from the AQP Boardon 5 November 2012.

Ms Sonja Sebotsa was appointed to the Board of Aquarius on 6 February 2013. Ms. Sebotsa was also appointed to the Board of Aquarius fully owned subsidiaryAQPSA and will assume the role of Chairman of AQPSA from acting AQPSA ChairmanMr. Zwelakhe. Mr Zwelakhe continues to serve as a non-executive director.

Jean Nel Chief Executive Officer

Robert Schroder Managing Director

Graham Ferreira Finance Director

Platinum Mile Management

Richard Atkinson Managing Director

Paul Swart Financial Director

Issued Capital

At 31 December 2012, the Company had on issue: 486,851,336 fully paid commonshares and 120,000 unlisted options.

Substantial Shareholders 31 December 2012 Number of Shares Percentage

HSBC Custody Nominees (Australia) Limited 26,873,642 5.52

Aquarius Platinum (South Africa) (Proprietary) Ltd

100% Owned

(Incorporated in the Republic of South Africa)

Registration Number 2000/000341/07

Unit 16, Berkley Office Park, 8 Bauhinia Street, Highveld Techno Park,Centurion, Pretoria, South AfricaPostal Address: PO Box 76575, Wendywood, 2144, South Africa

Aquarius Platinum Corporate Services Pty Ltd

100% Owned

(Incorporated in Australia)

ACN 094 425 555

For further information please visit www.aquariusplatinum.com or contact:

UG2 Reef A PGE-bearing chromite layer within the Critical Zone of the Bushveld

Complex