AQP.L Regulatory News (AQP)

AQUARIUS PLATINUM LIMITED Fourth Quarter 2014: Production Results Production Results to 30 June 2014 Highlights Attributable production from operating mines up 4% quarter-on-quarter, down 1%compared to previous corresponding period (pcp) Average PGM basket price increased 3% for the quarter - down 1% compared topcp. Kroondal PGM basket price increased 0.5% on average to R12,822 per PGM ouncequarter-on-quarter - up 12% compared to the previous year Mimosa PGM basket price increased 4% on average to $1,156 per PGM ouncequarter-on-quarter - down 6% compared to the previous year The Rand strengthened against the US Dollar by 2% on average quarter-on-quarter- down 18% compared to the previous year Cash costs at Kroondal unchanged at R9,396 per PGM ounce quarter-on-quarter -up 9% compared to the previous year Cash costs at Mimosa net of "one off voluntary retrenchment costs" were down10% to $803 per PGM ounce quarter-on-quarter - down 2% compared to the previousyear. Cash costs at Mimosa inclusive of "one off voluntary retrenchment costs"of $105 per PGM oz increased 2% to $908 per PGM ounce quarter-on-quarter - up1% compared to the previous year. Surface stockpile at Mimosa increased - now 165,000 tonnes Post quarter end, three year wage agreements were concluded with recognisedunions at Kroondal without any interruptions to operations Q4 2014 Operating Results Summary Kroondal Mimosa Platinum Mile 4E PGM production Total (100% basis) 106,181 60,818 0 Attributable 53,090 30,409 0 4E basket price R/oz 12,822 - - $/oz 1,215 1,156 - Cash costs (4Ebasis) R/oz 9,396 - - $/oz 890 908* - Cash margin (%) 17 30 - Stay-in-businesscapex R/oz 1,123 - - $/oz 106 99.74 - Includes one off voluntary retrenchment costs of $105 per 4E oz Commenting on the results, Jean Nel, CEO Aquarius Platinum said: The Group's fourth quarter performance was credible, with both Kroondal andMimosa delivering safety, production and cost performances ahead of guidance.Kroondal produced in excess of 105 000 4E ounces for a record 6th consecutivequarter, despite the interruptions from the public holidays and South Africannational elections. The successful conclusion of three year wage agreementswith represented unions at Kroondal without any production interruptions postquarter-end was also very pleasing and testimony to good labour relationsbetween Kroondal and its work force as well as represented unions. Mimosa delivered an equally credible production and cost performance despiteimplementing a significant voluntary retrenchment program during the quarter.This program is expected to contribute to lower costs at Mimosa going forward. At a corporate level Aquarius successfully completed the rights offer andlimited convertible bond tender offer, reducing the debt owing to bond holdersfrom $298 million to US$125 million. Following the completion of the combinedtransactions Aquarius also has significantly increased cash balances. Although post quarter end metal prices started to increase, the result of thisincrease is not yet evident in the quarter's results as metal prices in Dollarterms only increased 2% for Kroondal compared to pcp, Mimosa's basket price was5% lower than the pcp. The slightly higher metal prices notwithstanding, operating conditions remainedchallenging during the quarter, and hence as Aquarius enters the new financialyear management will continue with its established focus on safety, productionand cost discipline, whilst carefully assessing its project pipeline, pursuingonly those projects which add value to shareholders. Production by mine Quarter endedPGMs (4E) Jun 2014 Mar 2014 % Change Jun 2013 % Change Kroondal 106,181 107,818 (2) 106,872 (1) Mimosa 60,818 51,907 17 57,168 6 Platinum Mile - 289 (100) 4,810 (100) Total 166,999 160,014 4 168,850 (1) Production by mine attributable to Aquarius (Operating mines) Quarter endedPGMs (4E) Jun 2014 Mar 2014 % Change Jun 2013 % Change Kroondal 53,090 53,909 (2) 53,436 (1) Mimosa 30,409 25,954 17 28,584 6 Platinum Mile - 289 (100) 4,810 (100) Total 83,499 80,152 4 86,830 (4) Aquarius Group quarterly attributable production (PGM ounces) to 30 June 2014 See www.aquariusplatinum.com for graph PGM markets update Platinum traded robustly through the recently concluded strike action in SouthAfrica, with the Platinum price supported to a degree by lost production.Relatively muted price appreciation has largely been attributed to the factthat market participants were able to partially negate the associatedproduction disruption by the build-up in above-ground stocks, with the strikeaction being well flagged throughout 2013. Palladium has traded strongly so far this year, rising above $800 per ounce andremaining at its highest levels since 2011 underpinned by a combination offactors including a recovery in global auto sales, labour issues in SouthAfrica and increasing substitution of platinum. Intra-period scaling and pricevolatility is mostly attributed to Russia-Ukraine geopolitical tensions andassociated trade sanctions which could potentially have a fundamental impact onsupply / demand balance for the metal going forward. Demand continued to be robust for the platinum ETP in the quarter, reachingcontinued record holdings, resulting in more metal being taken out of themarket. The recent release of the Palladium ETF has proved to be a catalyst forinvestment growth during the quarter. The South African Rand has traded in a relatively narrow range of R10.30-10.84during the quarter, and daily trading volumes have moderated relative to thelevels seen last year. The Rand closed the quarter relatively unchanged atR10.59 compared to the previous period end. European vehicle sales have climbed over the course of last 3 months amidstimproving consumer confidence. Introduction and implementation of Euro VIemissions legislation have also provided support to PGM prices. Aside from thegrowth in Europe and the US, growth elsewhere appears to still be making up theground lost during the Polar Vortex with China continuing to impress with rapidgrowth in auto sales volumes (+11.6% YTD). Specific PGM prices commentary The average platinum price increased by 1.3%, while palladium increased by 9.4%and lesser traded rhodium increased by 3.8% from previous quarter. Golddecreased by 0.2% on average. Platinum closed the quarter up 4.8% at $1,486 perounce, while palladium rose by 8.6% to $843 per ounce and rhodium decreased by1.3% to $1,115 in comparison to previous quarter. Gold increased 3.4% to $1,327per ounce. 12-month individual PGM prices to 30 June 2014 (US$/oz) 12-month PGM basket prices to 30 June 2014 (US$ and ZAR per PGM basket ounce) 12-month ZAR price to 30 June 2014 (ZAR/US$) See www.aquariusplatinum.com for graphs Average PGM basket prices achieved at Aquarius operations Quarter endedUS$ per PGM ounce (4E) Jun 2014 Mar 2014 % Change Jun 2013 % Change Kroondal 1,215 1,179 3 1,195 2 Mimosa 1,156 1,112 4 1,217 (5) Platinum Mile - 1,179 (100) 1,169 (100) Weighted Avg. 1,194 1,157 3 1,201 (1) Operating Review Summary (all numbers on 100% basis) AQUARIUS PLATINUM (SOUTH AFRICA) (PTY) LTD (Aquarius Platinum - 100%) P&SA 1 at Kroondal (Aquarius Platinum - 50%) 12-month rolling average DIIR improved to 0.73 per 200,000 man hours from 0.98in the previous quarter Production increased to 1,786,000 tonnes from 1,686,000tonnes, quarter-on-quarter Head grade decreased marginally to 2.37 g/t from 2.38 g/t Recoveries decreased by 0.7% to 78% Volumes processed higher at 1,788,000 tonnes Stockpiles at the end of the quarter totalled approximately 35,000 tonnes PGM production decreased by 2% to 106,181 PGM ounces, quarter-on-quarter Revenue in Rand terms decreased by 5% to R1,207 million, quarter-on-quarter,due to a combination of a stronger Rand during the quarter and 2% lowerproduction Mining cash costs decreased by 1% to R558 per tonne, due to less stockpilebeing consumed Unit cost per PGM ounce increased 0.2% to R9,396 per PGM ounce Kroondal's cash margin for the period reduced from 21 % to 17 % See www.aquariusplatinum .com for graph Commentary Kroondal: The 12 month rolling DIIR improved materially to 0.73 from 0.98 in the previousquarter as did the 3 months DIIR rate which improved to 0.43 from 0.57. Thisfollows the continued focus and management of safety performance including inthe implementation of the new Safety programme of "My Life, My responsibility,I will comply" in September 2013. Wage agreement reached at Kroondal Subsequent to the end of the quarter, AQPSA reached separate three-year wageagreements with the National Union of Mineworkers ("NUM") and Solidarity inrelation to their respective members employed at Kroondal. The agreements areeffective from 1 July 2014, and will be applied to all employees within therespective bargaining units at Kroondal. The NUM represents the majority ofKroondal's semi-skilled work force, while Solidarity represents the majority ofKroondal's skilled work force. Measured on a cost to company basis the averageincrease slightly exceeds the increase in the cost of living as measured byinflation rate (CPI). Aquarius acknowledges with appreciation the critical contribution that theemployees of Kroondal continue to make to the ongoing safety and operationalimprovements at the Kroondal mine; the leadership shown by the Kroondal mine'smanagement team during the negotiation process and the constructive and maturemanner in which the NUM and Solidarity conducted the wage negotiations. The successful conclusion of the wage agreements are a significant positivedevelopment for the Company. AQPSA is extremely proud of its workforce whichworked without interruption to maintain its operating performance throughoutthe negotiation process. Production at Kroondal for the quarter of 1.8 million tonnes was achieved againnotwithstanding different challenges that were encountered at operations and inthe general industry, and interruptions due to public holidays and the SouthAfrican national elections. At K6, mining into very challenging ground conditions continued.Encouragingly, ground conditions appear to be improving with depth. At Kwezi Shaft challenging ground conditions still persist and in this quarterthe mine continued to reduce the splits further to keep the pillars intact asthey were peeling off due to iron-rich ultramafic pegmatite (IRUP) which issituated at the bottom of the main seam. Kopaneng Shaft has now commissioned the underground workshop and the majorityof all TMM (Trackless Mobile Machines) are being parked and servicedunderground. Simunye Shaft performed very well although the shaft was issued with a Section54. This was lifted after 2 production days were lost. Bambanani Shaft commissioned their first underground bunker. The ore beingmined from the Ackermans area is now hoisted through the Bambanani beltinfrastructure. Depleted production panels at Bambanani will be replaced withpanels in the Marikana ground. Compressed air and water services for this areaare provided through Marikana 4 Shaft. In the next quarter 40% of Bambananiproduction will be coming from the Marikana 4 Shaft area. Bambanani was alsoissued with a Section 54 instruction which was again lifted after 2 productiondays. P&SA2 at Marikana (Aquarius Platinum - 50%) Given the continuing low Rand PGM basket prices, Marikana 4 shaft, theremaining operating shaft, and the processing plant at Marikana continue oncare and maintenance until further notice. Everest MineSimilarly, given the continuing low Rand PGM basket prices, temporarygeological problems and unstable labour relations, the Everest mine remainsplaced on care and maintenance until further notice. AQPSA Operating cash costs per ounce (Rand) 4E 6E 6E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni&Cu) Kroondal 9,396 7,713 7,476 Capital expenditure Kroondal (R'000 unless otherwise stated) Total Per 4E oz Ongoing establishment of infrastructure 88,734 836 Project capital (K6 shaft) 30,486 287 Mobile equipment 52,726 497 Total 171,946 1,620 Kroondal mine: reconciliation of cash costs per 4E ounce Cost per 4E ounce (Rand) Q4 Q3 Total operating expenditure 11,025 10,084 Less: Ongoing capital expenditure & mobile equipment (1,332) (931) Project capex (K6 shaft) (287) (182) Transferred from/(to) stockpile (10) 405 On mine cash costs 9,396 9,376 Development of the K6 shaft at Kroondal is almost complete with only minorsurface infrastructure snags and the permanent power construction beingcompleted during H1 of FY15. MIMOSA INVESTMENTS (Aquarius Platinum - 50%) 12-month rolling average DIIR was 0.08 per 200,000 man hours worked Production increased by 9% to 648,944 tonnes, quarter-on-quarter Head grade static at 3.67 g/t Recoveries decreased by 0.5% to 77% Volumes processed increased by 14% to 648,902 tonnes Stockpiles at the end of the quarter totalled approximately 165,102 tonnes PGM production increased by 17% to 60,818 PGM ounces quarter-on-quarter, due toimproved stability of the plant. A number of challenges were experienced in theprior quarter Revenue increased by 26% to $79 million, from $63m in the previous quarter Mining cash costs increased by 5% to $85 per tonne, and costs per PGM ounce by2% to $908 due to retrenchment costs. Cash costs before "one off retrenchmentcosts" decreased 10% to $803 per PGM ounce for the quarter. Stay-in-business capital expenditure was $99.74 per PGM ounce for the quarter Gross cash profit margin for the period increased from 26% to 30% See www.aquariusplatinum.com for chart Operating cash costs per ounce Unit cash costs per PGM ounce (before by-product credits) were 2% higher thanthe previous quarter due to once off retrenchment costs of US$5.3 million. Cash costs before "one off retrenchment costs" incurred during the quarterwere 10% lower at $803 per PGM ounce. 4E 6E 4E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu & Co) Mimosa 908 861 627 Capital expenditure The total capital expenditure for the fourth quarter amounted to $6.8 million.Expenditure was incurred mainly on mobile equipment, drill rigs and LHDs, theconveyor belt extension and down dip development and remains within guidanceprovided by the Company. TAILINGS OPERATION Platinum Mile (Aquarius Platinum - 91.7%) The strike at Anglo Platinum resulted in zero production for the quarter endedJune 2014. The strike has since ended and, although significant uncertainty inrelation to the date and level of production recommencement prevail, Plat Mileexpects to commence receiving feed in late July 2014. Platinum Mile derives its feed-stock from concentrator plant owned and managedby Anglo Platinum in the Rustenburg area which has been on strike since 25January 2014. Anglo Platinum has indicated in a press release that productionramp-up will start once all striking workers have undergone medicalexaminations and safety training. The Coarse Milling Expansion was completed and successfully electromechanicallycommissioned during the current quarter. Capital expenditure for the quarteramounted to R2.3 million and the total CAPEX to complete this expansion wasR25.8 million. The benefits of this expansion on production yields shouldbecome evident in the next quarter. Operating cash costs per ounce 4E 6E 4E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu& Co) Platinum Mile - - - Chromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum - 50%) This operation remains on care and maintenance. CORPORATE MATTERS Tender Offer and Rights Issue On 7 April 2014, Aquarius Platinum Limited announced a tender offer to purchasea maximum of $225 million in principal amount of convertible bonds of thecurrent $298 million in principal amount of the convertible bonds outstandingat a repurchase price of $92,000 per $100,000 in principal amount of existingconvertible bonds. The aggregate nominal amount of convertible bonds validlytendered pursuant to the tender offer was $172.6 million. The repurchase price, which together with accrued interest totalled $165.7million, was paid to security holders in May 2014. The company advised that the tender offer would be financed upon the successfulcompletion of a rights issue to finance part or all of the amount payable bythe company for the existing convertible bonds accepted for repurchase pursuantto the Tender offer. The company received valid acceptances in respect of 931,250,197 rights issueshares, representing approximately 95.39 per cent of the total number of rightsissue shares offered to qualifying shareholders pursuant to the rights issueannounced by the company on 7 April 2014. The company confirms that shortfallfor the remaining 44,956,709 rights issue shares were placed by theunderwriters. The rights issue grossed $226.1 million through the issuance of976,206,906 new common shares. Following completion of the rights issue, the company's issued share capitalconsists of 1,464,310,359 common shares. The company holds 17,047,787 commonshares as treasury shares in accordance with Bermudan law. Therefore, the totalnumber of voting rights in the company is 1,447,262,572. This figure may beused by shareholders as the denominator for the calculations by which theydetermine if they are required to notify their interest in, or a change intheir interest in, the company under the FCA's Disclosure and TransparencyRules. Full details of the tender offer and Rights Issue can be found atwww.aquariusplatinum.com Update on Sale of Assets The company released details of the planned sale of two non-core assets beingits interest in the Blue Ridge Mine and its interest in the Kruidfonteinprospecting right on 30 January 2014. In the release the company confirmed itsexpectation that the conditions precedent would be fulfilled in H2 calendar2014. This time line remains the company's base case expectation. Work inrelation to the fulfilment of the conditions precedent, noted in the releases,continues. Shareholders will be informed of any material developments in thisregard as soon as is practical. Statistical information: Kroondal P&SA1 See www.aquariusplatinum.com for statistical information table Statistical information: Mimosa See www.aquariusplatinum.com for statistical information table Note: Mimosa current quarter cash cost per PGM ounce Includes one off voluntaryretrenchment costs of $105 per 4E oz. Unit cash costs for the quarter adjustedfor "once off" voluntary retrenchments were $803 per PGM ounce. Aquarius Platinum LimitedIncorporated in Bermuda Exempt company number 26290 Board of Directors Nicholas Sibley Non-executive Chairman Jean Nel Chief Executive Officer David Dix Non-executive Tim Freshwater Non-executive (Senior Independent Director) Edward Haslam Non-executive Kofi Morna Non-executive Zwelakhe Mankazana Non-executive Sonja de Bruyn Sebotsa Non-executive Audit/Risk Committee David Dix (Chairman) Tim Freshwater Edward Haslam Kofi Morna Nicholas Sibley Remuneration Committee Edward Haslam (Chairman) David Dix Zwelakhe Mankazana Nicholas Sibley Nomination Committee Sonja de Bruyn Sebotsa (Chairman) Edward Haslam Tim Freshwater Kofi Morna Willi Boehm Company Secretary Willi Boehm AQPSA Management Robert Schroder Managing Director Jean Nel Executive Director Wessel Phumo General Manager: Kroondal Mimosa Mine Management Winston Chitando Chairman Herbert Mashanyare Technical Director Peter Chimboza Resident Director Fungai Makoni General Manager Finance & Company Secretary Platinum Mile Management Richard Atkinson Managing Director Paul Swart Financial Director Issued capital At 30 June 2014, the Company had on issue: 1,464,310,394 fully paid commonshares. Substantial shareholders 30 June 2014 Number of Shares Percentage HSBC Custody Nominees (Australia) Limited 110,254,065 7.53 J P Morgan Nominees Australia Limited 69,919,771 4.77 Primary Australian Securities Exchange Trading InformationListing: (AQP.AX) Premium London Stock Exchange (AQP.L) ISIN number BMG0440M1284Listing: Secondary JSE Limited (AQP.ZA) ADR ISIN number US03840M2089Listing: Convertible bond ISIN number XS0470482067 Broker (LSE) Broker (ASX) Sponsor (JSE) Barclays Euroz Securities5 The North Level 18 AlluvionColonnade 58 Mounts Bay Road, Rand Merchant BankCanary Wharf Perth WA 6000 (A division of FirstRand BankLondon E14 4BB Telephone: +61 (0) 8 Limited)Telephone: +44 (0) 9488 1400 1 Merchant Place20 7623 2323 Cnr of Rivonia Rd and Fredman Drive, Sandton 2196 Johannesburg South Africa Aquarius Platinum (South Africa) (Proprietary) Ltd 100% owned(Incorporated in the Republic of South Africa) Registration Number 2000/000341/07 1st Floor, Block C, Rosebank Office Park, 181 Jan Smuts Avenue, Rosebank, SouthAfrica Postal Address: PO Box 7840, Centurion, 0046, South Africa Telephone: +27 (0)10 001 2848 Facsimile: +27 (0)12 001 2070 Aquarius Platinum Corporate Services Pty Ltd 100% Owned (Incorporated in Australia) ACN 094 425 555 Level 4, Suite 5, South Shore Centre, 85 The Esplanade, South Perth WA 6151,Australia Postal Address: PO Box 485, South Perth, WA 6951, Australia Telephone: +61 (0)8 9367 5211 Facsimile: +61 (0)8 9367 5233 Email: info@aquariusplatinum.com For further information please visit www.aquariusplatinum.com or contact: In the United Kingdom and South Africa: In Australia:Jean Nel+27 (0)10 001 2848 Willi Boehm +61 (0) 8 9367 5211 Glossary A$ Australian Dollar Aquarius Aquarius Platinum Limitedor AQP APS Aquarius Platinum Corporate Services Pty Ltd AQPSA Aquarius Platinum (South Africa) (Pty) Ltd ACS(SA) Aquarius Platinum (SA) Corporate Services (Pty) Ltd BEE Black Economic Empowerment BRPM Blue Ridge Platinum Mine CTRP Chrome Tailings Retreatment Operation. Consortium comprising Aquarius Platinum (SA) (Corporate Services) (Pty) Limited (ASACS), Ivanhoe Nickel and Platinum Limited and Sylvania South Africa (Pty) Ltd (SLVSA). DIFR Disabling injury frequency rate, being the number of lost-time injuries expressed as a rate per 1,000,000 man-hours worked DIIR Disabling injury incidence rate, being the number of lost-time injuries expressed as a rate per 200,000 man-hours worked DME formerly South African Government Department of Minerals and Energy DMR South African Government Department of Mineral Resources, formerly the DME Dollar United States Dollaror $ Everest Everest Platinum Mine Great A PGE-bearing layer within the Great Dyke Complex in ZimbabweDykeReef GoZ Government of Zimbabwe g/t Grams per tonne, measurement unit of grade (1g/t = 1 part per million) JORC Australasian code for reporting of Mineral Resources and Ore Reservescode JSE Johannesburg Stock Exchange Kroondal Kroondal Platinum Mine or P&SA1 at Kroondal LHD Load haul dump machine Marikana Marikana Platinum Mine or P&SA2 at Marikana Mimosa Mimosa Mining Company (Private) Limited nm Not measured pcp previous corresponding period PGE(s) Platinum group elements plus gold. Five metallic elements commonly(6E) found together which constitute the platinoids (excluding Os (osmium)). These are Pt (platinum), Pd (palladium), Rh (rhodium), Ru (ruthenium), Ir (iridium) plus Au (gold) PGM(s) Platinum group metals plus gold. Aquarius reports PGMs as comprising(4E) Pt+Pd+Rh plus Au (gold) with Pt, Pd and Rh being the most economic platinoids in the UG2 Reef PlatMile Platinum Mile Resources (Pty) Ltd P&SA1 Pooling & Sharing Agreement between AQPSA and RPM Ltd on Kroondal P&SA2 Pooling & Sharing Agreement between AQPSA and RPM Ltd on Marikana R South African Rand Ridge Ridge Mining Limited ROM Run of mine. The ore from mining which is fed to the concentrator plant. This is usually a mixture of UG2 ore and waste. RPM Rustenburg Platinum Mines Limited, a subsidiary of Anglo PlatinumLimited Limited Tonne 1 metric tonne (1,000kg) TARP Trigger Action Response Procedure UG2 Reef A PGE-bearing chromite layer within the Critical Zone of the Bushveld Complex