AQP.L Regulatory News (AQP)

Aquarius Platinum Limited Production Results to 31 December 2013 Highlights Attributable production from operating mines up 1% quarter-on-quarter, up 7%compared to previous corresponding period (pcp) Average PGM basket price decreased 2% for the quarter - down 9% compared topcp. The Rand weakened against the US Dollar by 1% on average quarter-on-quarter -down 17% compared to pcp Cash costs at Kroondal decreased 5% to R8,612 per PGM ounce quarter-on-quarter- up 2% compared to pcp Cash costs at Mimosa decreased 4% to $837 per PGM ounce quarter-on-quarter -down 7% compared to pcp Surface stockpile at Mimosa increased - now 136,000 tonnes Q2 2014 Operating Results Summary Kroondal Mimosa Platinum Mile 4E PGM Production Total (100% basis) 110,303 55,586 1,583 Attributable 55,152 27,793 1,583 4E Basket Price R/oz 11,589 - 11,360 $/oz 1,145 1,126 1,117 Cash Costs (4Ebasis) R/oz 8,612 6,641 $/oz 851 837 653 Cash Margin (%) 7 18 20 Stay-in-BusinessCapex R/oz 990 - - $/oz 98 176 - Commenting on the results, Jean Nel, CEO Aquarius Platinum said: The highlight of the second quarter was undoubtedly the continued increase inproduction and reduction in costs at Mimosa and specifically at Kroondal whichis now consistently producing at levels higher than at any point in its 10 yearlife. This is testimony to excellent operational management by the AQPSA teamlead by MD Rob Schroder and Kroondal GM, Wessel Phumo as well as a motivatedstable work force at Kroondal. The improved cost performance partially offsetthe lower prices which prevailed during the quarter. At Mimosa production was stable and costs reduced further, in line withexpectations. Unfortunately Mimosa does not benefit from a weakening currencyand hence the lower Dollar metal prices impacted its margin directly. PlatinumMile's production for the quarter was at reduced levels following interruptionsin its feed caused by industrial action at Anglo Platinum, but still managed acredible performance for the half year. Overall the company's safety, production and cost performance continued toimprove and are at credible levels. The challenge is to maintain this credibleperformance whilst making incremental productivity and efficiency improvements,something we are absolutely committed to. The quarter also saw a further decline in Dollar and Rand metal prices. At theprices which prevailed during the quarter our business remains marginal,despite the cost reductions which we have successfully implemented. The declinein metal prices reversed after quarter end, albeit for the wrong reasons, asindustrial action looms in South Africa and regulatory uncertainty continues inZimbabwe. For as long as this increase prevails we will benefit from higherrevenues and margin expansion provided production remains uninterrupted. Ourresolute focus on incremental improvements in safety, production and costsremains paramount with improvement programs in place across all operations. The continued regulatory uncertainty in Zimbabwe is of particular concern to usas it impacts Mimosa's ability to plan future production levels and capitalallocation efficiently. Discussions with the Government of Zimbabwe continueand, seeing as we share the Government of Zimbabwe's vision for a healthygrowing Zimbabwean platinum mining sector, we remain hopeful the matters couldbe agreed in due course. Production by mine Quarter endedPGMs (4E) Dec 2013 Sept 2013 % Change Dec 2012 % Change Kroondal 110,303 106,441 4 102,525 8 Mimosa 55,586 53,048* 5 52,752 5 Platinum Mile 1,583 3,729 (58) 1,349 17 Total 167,472 163,218 3 156,626 7 *comparative figure (Sept '13) has been amended to reflect adjustment inproduction ounces reconciled. Production by mine attributable to Aquarius (Operating mines) Quarter endedPGMs (4E) Dec 2013 Sept 2013 % Change Dec 2012 % Change Kroondal 55,152 53,220 4 51,262 8 Mimosa 27,793 26,524* 5 26,376 5 Platinum Mile 1,583 3,729 (58) 1,349 17 Total 84,528 83,473 1 78,987 7 *comparative figure (Sept '13) has been amended to reflect adjustment inproduction ounces reconciled. Aquarius Group quarterly attributable production (PGM ounces) to 31 December2013 See www.aquariusplatinum.com for graph Market Summary The second quarter PGM Rand basket price performance was characterised by thesame volatility and overall flat direction that characterised the rest of 2013.Like the other "Fragile Five" emerging market currencies, the South AfricanRand continued to weaken on tapering fears and finished at a multiyear lowagainst the dollar of R10.49. This weakness in the Rand offset a smallweakening in the US dollar metal prices. Platinum prices shrugged off thestrike at Northam Platinum that begun on November 4 and continued for the restof the year, indicating the presence of large above ground stockpiles. ETFinvestment demand did continue into Q2, albeit at a slower pace than previousquarters, with c.250koz added. Non-commercial net futures positioning, that hasbeen the key driver for the metal price in 2013, lost c.620koz of platinum,leaving positioning a net long of 1.15 Moz and relatively neutral compared toprevious years. The average platinum price decreased by 3.9%, while palladium increased by 0.2%and rhodium decreased by 4.6% quarter on quarter. Gold decreased by 4.3% onaverage. Platinum closed the quarter down 3.6% at $1,357 per ounce, whilepalladium fell by 1.4% to $716 per ounce and rhodium fell by 1.5% to $975 overthe same period. Gold fell 9.4% to $1,203 per ounce. Rand-Dollar exchange rate The average Rand-Dollar exchange rate weakened during the quarter, falling by1.3% from R9.99 to R10.12 to the US dollar. Since then, the Rand has weakenedfurther to average R10.67 in the first two weeks of January. The average Rand basket price for the quarter decreased by 2%quarter-on-quarter, and the spot price by 2% over the period. The US Dollarweighted average group basket price decreased by 2% to $1,138 per 4E PGM ouncecompared to the previous quarter. The average South African basket price atAQPSA's operations was R11,624 per PGM ounce for the period. Subsequent to theend of the quarter, the PGM basket price has consolidated to average R12,421per PGM ounce for the first two weeks of January. See www.aquariusplatinum.com for graphs Average PGM basket prices achieved at Aquarius operations Quarter endedUS$ per PGM ounce (4E) Dec 2013 Sept 2013 % Change Dec 2012 % Change Kroondal 1,145 1,183 (3) 1,261 (9) Mimosa 1,126 1,128 - 1,213 (7) Platinum Mile 1,117 1,173 (5) 1,269 (12) Weighted Avg. 1,138 1,165 (2) 1,245 (9) 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 0.99 per 200,000 man hours from 1.05in the previous quarter Production increased to 1,867,000 tonnes from 1,851,000 tonnes Head grade improved from 2.38 g/t to 2.42 g/t Recoveries improved by 2% to 79% Volumes processed increased to 1,800,000 tonnes, up 1% quarter-on-quarter Stockpiles at the end of the quarter totalled approximately 147,000 tonnes, up67,000 tonnes PGM production increased by 4% to 110,303 PGM ounces Revenue decreased by 6% to R1,026 million quarter-on-quarter due a negativesales adjustment of R72.4 million due to the lower metal prices in the quarter Mining cash costs decreased by 2% to R528 per tonne, due to improved productionand electricity prices alternating to summer rates and stock pile adjustments Unit cost per PGM ounce reduced 5% to R8,612 per PGM ounce due improved qualityand electricity alternating to summer rates and stock pile adjustments Kroondal's cash margin for the period deteriorated from 12% to 7% despite thecredible cost performance because of lower Rand prices including a negativesales adjustment of R72.4 million See www.aquariusplatinum.com for graph Commentary Kroondal: Production at Kroondal was maintained at 1.867 million tonnes, up 1% comparedto the previous quarter. While the iron-rich ultramafic pegmatite (IRUP) ore isstill being mined at Kwezi a solution has been found to the issue of recoveryby blending the material and increasing floatation retention time in theprocess plants. Recoveries thus improved by 2% quarter on quarter. A new safety campaign was launched on the 27 of September 2013 where operationsfor the entire mine were closed with the purpose of re-energising safetyawareness at Kroondal. The theme for the new safety strategy is "My Life, Myresponsibility, I will comply" which was settled on after an analysis wascarried out on incidents and accidents during the past year which showed thatour employees don't comply with our own standards and procedures. The launchwas also attended by the Principal Inspector of the Department of MineralResources (who gave a short address) and two Senior Inspectors. During the quarter the Kroondal work force maintained a positive outlook withopen communication channels on all levels. As previously reported, regrettablya fatal incident was recorded during the quarter at Kwezi when Miss (Cynhthiah)Anikie Setuke was fatally assaulted at her workplace underground. There werethree Section 54 instructions during this quarter in review. These resulted inan aggregate loss of 5 working days in underground production. P&SA2 at Marikana (Aquarius Platinum - 50%) There has been no change to the Marikana operations which remain on care andmaintenance until further notice. Everest MineThere has been no change to the Everest operations which remain on care andmaintenance 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 8,612 7,067 6,868 Capital expenditure Kroondal (R'000 unless otherwise stated) Total Per 4E oz Ongoing establishment of infrastructure 86,113 781 Project capital (K6 shaft) 23,003 209 Mobile equipment 29,539 267 Total 138,655 1,257 The Company continues to develop the K6 shaft at Kroondal and conduct designwork at Everest. The K6 shaft sinking project remains on budget and is ahead ofschedule. The Company expects to incur R90 million in capital (R45 millionattributable to Aquarius) during H2 on this project, in line with budget. The company continues to maintain all other project and growth capitalexpenditure on hold, pending improved market conditions. The Company iscontinuing with the necessary maintenance capital expenditure required by itsoperating mines. The capital expenditure on mobile equipment is financedthrough a lease agreement over the life of the equipment. Kroondal mine: reconciliation of cash costs per 4E ounce Cost per 4E ounce (Rand) Q1 2014 Q2 2014 Total operating expenditure 10,076 10,106 Less: Ongoing capital expenditure & mobile equipment (543) (1,048) Project capex (K6 shaft) (236) (209) Transferred (to)/from stockpile (203) (237) On mine cash costs 9,094 8,612 Stockpile movements Kroondal's stockpile is utilised to maximise production efficiencies at theconcentrator plants. Typically ore will be drawn from the stockpile to coverbreaks in underground mining that may occur. Ore was drawn from the stockpilein Q3 to cover anticipated shortfalls due to the Christmas break. This willresult in an increase in costs during Q3. MIMOSA INVESTMENTS (Aquarius Platinum - 50%) Mimosa Platinum Mine 12-month rolling average DIIR deteriorated to 0.05 per 200,000 man hours worked Production increased by 1% to 629,101 tonnes Head grade improved to 3.65 g/t Recoveries improved slightly to 78% Volumes processed increased by 2% to 632,872 tonnes Stockpile at the end of the quarter was approximately 135,573 tonnes PGM production increased by 5% to 55,586 PGM ounces Revenue whilst flat on a PGM ounce basis, increased in line with increasedounces sold Mining cash costs decreased by 1% to US$75 per tonne, costs per PGM ouncedecreased by 4% to $837 on higher production Stay-in-business capital expenditure was $176 per PGM ounce for the quarter Mimosa's cash margin for the period remained the same at 18% as in previousquarter. See www.aquariusplatinum.com for graph Commentary The Mimosa mine continues to operate well, despite cost pressures which hasincreased in recent quarters. The Mimosa management team has identified anumber of cost saving initiatives which are currently being implemented. Operating cash costs per ounce Unit cash cost per PGM ounce (before by-product credits) was 4% lower thanthose achieved in the previous quarter on increased production. Comparativesproduction figures for September 2013 quarter have been revised down by 1,031PGM ounces on an attributable basis following reconciliation of production. 4E 6E 4E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu & Co) Mimosa 837 792 544 Capital expenditure The total capital expenditure for the second quarter amounted to $11.4 million(on a 100% basis, in line with the guidance provided by AQP). Expenditure wasmainly incurred on mobile equipment, Drill Rigs and LHD; Conveyor beltextension and Down dip Development TAILINGS OPERATION Platinum Mile (Aquarius Platinum - 91.7%) Material processed decreased 8% to 1,043,000 tonnes Head grade decreased to 0.62 g/t Recoveries decreased to 8% Production decreased to 1,583 PGM ounces Cash costs decreased to R6,641 per PGM ounce Revenue was lower at R13 million for the quarter due to lower production Cash margin for the quarter was 20%, down from 23% in the previous quarter Commentary Platinum Mile The results for the quarter were negatively impacted by strikes at AngloPlatinum during the month of October and the Christmas break in operations. Atotal of 21 production days were lost for these reasons. As a result of the recent restructuring at Anglo, Platinum Mile has resumedtreating UG2 material that has traditionally provided lower recoveries athigher chrome levels. It is expected that the course grinding expansion due tobe commissioned by the end of the third quarter of this financial year willreplace the lost yields resulting from the Anglo Platinum restructuring. Whilst the results for the quarter were impacted by the Anglo Platinum strikesand restructuring, encouragingly a positive cash margin was achieved despitethese trying circumstances. Chromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum - 50%) The operation remains on care and maintenance since 6 August 2012. 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 6,641 5,726 5,212 CORPORATE MATTERS Results of AGM Shareholders approved all resolutions tabled at the recent AGM held on 28November 2013. As a result, the company has commenced the implementation of thecash preservation initiatives outlined to shareholders at the AGM comprising: a reduction in directors' fees of 10% and directors' to receive 25% of theremaining directors' fees in shares in lieu of cash; and implementation of a Director and Employee Share Plan through which the CEO Mr.Nel would receive 70% of his salary and any applicable bonuses he may receiveover the next three years (commencing from 1 July 2013) in shares, instead ofcash. Zimbabwean Budget update Mimosa has noted amendments contained in the proposed Zimbabwean nationalbudget for 2014 which, if implemented, will impact on the company. Theseinclude royalties which is proposed will be non-deductible for income taxpurposes (currently deductible) and an export tax on un-beneficiated platinum.The implementation of further taxes will have a significant negative impact onthe profitability and cash flows of the entire Zimbabwean platinum sector,particularly in the current low price environment. Mimosa management inconsultation with the Zimbabwe Chamber of Mines will continue to engage withthe Government of Zimbabwe in an effort to clarify the proposed changes to thefiscal regime, acknowledging that Aquarius and Mimosa share the vision of agrowing platinum mining sector with the Government of Zimbabwe.. More information on all corporate matters can be found atwww.aquariusplatinum.com Statistical Information: Kroondal P&SA1 See www.aquariusplatinum.com for statistical information Statistical Information: Mimosa See www.aquariusplatinum.com for statistical information Statistical Information: Platinum Mile See www.aquariusplatinum.com for statistical information 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 CommitteeDavid Dix (Chairman)Edward HaslamTim FreshwaterKofi MornaNicholas Sibley Remuneration CommitteeEdward Haslam (Chairman)David DixZwelakhe MankazanaNicholas Sibley Nomination CommitteeSonja de Bruyn Sebotsa (Chairman)Edward HaslamTim FreshwaterKofi MornaWilli Boehm Company SecretaryWilli Boehm AQPSA ManagementRobert Schroder Managing DirectorJean Nel Executive DirectorGraham Ferreira Finance DirectorWessel Phumo General Manager: Kroondal Mimosa Mine ManagementWinston Chitando ChairmanHerbert Mashanyar Technical DirectorPeter Chimboza Resident DirectorFungai Makoni Managing Director Platinum Mile ManagementRichard Atkinson Managing DirectorPaul Swart Financial Director Issued Capital At 31 December 2013, the Company had on issue: 487,605,536 fully paid commonshares. Substantial Shareholders 31 December 2013 Number of Shares Percentage Wellington Management Company 40,593,492 8.33 The Capital Group of Companies 37,117,112 7.61 HSBC Custody Nominees (Australia) Limited 32,262,154 6.62 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) (Joint) Broker (ASX) Sponsor (JSE) Liberum CapitalLimitedRopemaker Place,Level 12 25 Ropemaker Street,LondonEC2Y 9LYTelephone: +44 (0) Euroz Securities20 3100 2000 Level 18 Alluvion Rand Merchant Bank 58 Mounts Bay Road, (A division of FirstRand BankBarclays Perth WA 6000 Limited) Telephone: +61 (0) 8 1 Merchant Place5 The North 9488 1400 Cnr of Rivonia Rd and FredmanColonnade Drive, Sandton 2196 Johannesburg South AfricaCanary WharfLondon E14 4BBTel: +44 (0) 20 7623 2323Telephone: +44 (0)20 7628 1000 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, SouthAfricaPostal Address: PO Box 7840, Centurion, 0046, South Africa Telephone: +27 (0) 10 001 2848 Facsimile: +27 (0) 12 001 2070Aquarius 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 6151, 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 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 JSE Limited 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 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 the PGMs as(4E) comprising Pt+Pd+Rh plus Au (gold) with the 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. 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