Last checked at 29 Mar 2012 07:00
AIM: JLP
JSE: JBL | 29 March 2012 |
INTERIM REPORT
FOR THE SIX MONTHS ENDED 31 DECEMBER 2011
The Board of Jubilee Platinum, the AIM traded and JSE listed 'mine-to-metals' exploration and development company (the "Company" or "Jubilee"), is pleased to announce the interim results for the six months ended 31 December 2011.
HIGHLIGHTS IN THE PERIOD UNDER REVIEW
• Company produced its initial platinum containing alloy for export, in March 2012 and will continue to increase the production of this material.
• The new 5MVA furnace commissioned at Middelburg became operational in November 2011 with the Middelburg operation reaching a record production of 774 tonnes of ferroalloy in January 2012 and 818 tonnes in March 2012. Ramping up of the operation continues in order to reach targeted full production of 1200 tonnes of alloy per month.
• The Middelburg site continues to increase revenues and generating cash flow in line with the ramp-up of the operation since November 2011.
• Company focussed on advancing current and several new opportunities for ConRoast including potential rights to chromite tailings, existing joint ventures, securing prospecting and mining rights for its PGM-bearing chromite deposits in the western Bushveld.
• Tjate/Jubilee received a cash offer of ZAR75 million for Quartzhill farm portion of the Tjate platinum deposit - Quartzhill is considered not being core to Tjate's long term mining plan.
• A Mining Right Application has been submitted for the Tjate Platinum project.
• Jubilee concluded a drilling program for new samples on the Leinster nickel sulphide tailings for testwork at Mintek South Africa.
• The Company raised GBP4.422 million through a placing of 31 585 714 new Jubilee oridnary shares with major insitutional investors at a price of 14 pence (ZAR1.72)
Leon Coetzer, CEO of Jubilee Platinum commented: "The results for the six months period reflect the increased costs associated with the commissioning activities and operations ramp up of the new furnace installation. We are pleased to have reached measurable increases in production at the smelter operation on the back of the new furnace ramp up, reaching 818 tons of nickel rich ferroalloy in March 2012. We look forward to maintaining this momentum through the remainder of the financial year as we target 1200 tons per month of ferroalloy production. We continue with our plans to migrate the smelting facility towards increasing the production of platinum rich alloy and to pursuing Tjate's mining right application in order to advance the Tjate project."
CHAIRMAN'S REPORT
Dear Shareholder,
The Company operated in a challenging six months period ending 31 December 2011 making significant positive progress in the implementation of its Mine-to-Metal business strategy.
In the period under review:
The Company on behalf of its subsidiary Tjate Platinum Corporation (Pty) Ltd ("Tjate Platinum") received a ZAR75M cash offer from a major mining company for the Quartzhill farm, a portion of the Tjate Platinum's Project. This offer represents a premium of nearly double the pro-rated original purchase price for the farm, which is not core to Tjate Platinum's long-term mining plan for the project. This offer, which Jubilee is recommending to Tjate Platinum shareholders, is subject, inter alia, to the approval of 80% of Tjate Platinum shareholders, regulatory approvals and due diligence by the offeror. The offer is a vindication of Jubilee's acquisition of a substantial interest in what is arguably the largest undeveloped block of platinum in the eastern Bushveld.
The Company awaits the Department of Mineral Resources' ("DMR") acceptance of Tjate Platinum's application for a mining right.
Applications for other Jubilee projects being considered by the DMR include mining right applications by the Company's subsidiary Maude Mining and Exploration for platinum to portions on Elandsdrift and Bokfontein farms; and a prospecting right for platinum and chromite in a separate venture for farms comprising more than 64 other portions of the Bokfontein farm.
The Company's new ferroalloy smelting furnace (5MVA AC) in Middelburg became operational in November 2011 with the Middelburg operation reaching in January 2012(post interims) a record 774 tonnes of ferroalloy production and a new high in March 2012 of 818 tonnes of ferroalloy. This steady progress in production ramp up of the new furnace reflects the successful use of improved refractory materials for the furnace shell lining and tap blocks resulting in materially less corrosion of the linings and in turn less furnace downtime. The increase in production has resulted in a strong increase in revenues generated by the operation (from November 2011 and post interims). The management continues to ramp up production towards its targeted design output of 1200 tonnes ferroalloy per month.
The Company continued its dialogue with Northam Platinum under its Memorandum of Understanding to establish a joint venture to evaluate the construction of a dedicated 5MW DC arc furnace facility using ConRoast technology specifically to smelt concentrate produced from Northam's developing Booysendal mine in the eastern Bushveld.
The Department of Economic Development, Environment and Tourism issued the Company's subsidiary Jubilee Smelting and Refining (Pty) Ltd. ("JSR") in Middelburg with an Atmospheric Emission Licence in respect of its current and submitted new planned operations. JSR's smelter operation is now fully permitted for the implementation of the ConRoast process and associated refining of the PGM containing alloy. This, together with maximising cash flow from the ferroalloy smelting process, significantly advances JSR's medium term mission for the implementation of the complete ConRoast platinum smelting process and further strengthens its position in negotiations in sourcing PGM-rich chromite tailings.
The Company has continued to assess and enter into dialogue with owners of near-term PGM-rich chromite mining and tailings retreatment opportunities. Jubilee is in a unique position to avail itself of these opportunities due to its ability to process platinum concentrates containing high chrome values. The Company has submitted a bid for the processing of a platinum-bearing chromite tailings opportunity and expects the outcome of the bid to be announced within Quarter 2 of 2012. Processing of own platinum concentrates significantly enhances the business model for the Company.
In Madagascar, the Company's 2011 planned drilling programme for the Ambodilafa project has been delayed due to difficulties with the local drilling contractor. The Company continues to review its strategic options for continued exploration in the country.
Jubilee's Australian subsidiary, Braemore Nickel (Pty) Ltd ("Braemore") concluded a drilling program on the Leinster nickel sulphide tailings to obtain fresh samples for testwork at Mintek South Africa, in order to refine the scoping flowsheet on the Nickel Tailings Project.
During the period under review, the Company made a loss attributable to shareholders of £3,347,944 compared to a loss of £1,252,442 in the six months ended 31 December 2010. The loss per share for the period under review was 1.24 pence against a loss of 0.76 pence for the interim period ending 31 December 2010. Of this 1.24 pence loss per share, depreciation accounted for 0.27 pence per share.
In October 2011, the Company raised £4.422 million gross through a placing with major institutions of 31,585,714 new ordinary shares of 1 pence each in the Company at 14p per share representing a 12% premium to the then prevailing market price.
Colin Bird
CHAIRMAN
29 March 2012
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the period ended 31 December 2011
Six months ended | Year ended | |||
| 31 DEC 2011 Unaudited £'000
| 31 DEC 2010 Unaudited £'000
| 30 JUN 2011 Audited £'000
| |
Revenue | 1 316 | 3 567 | 5 503 | |
Cost of Sales | (1 102) | (2 168) | (5 241) | |
214 | 1 399 | 262 | ||
Negative goodwill | - | |||
Other administrative expenses | (4 016) | (2 697) | (6 772) | |
Total administrative expenses | (4 016) | (2 697) | (6 772) | |
Operating loss | (3 802) | (1 298) | (6 510) | |
Finance income | 15 | 46 | 149 | |
Finance cost | (187) | - | (648) | |
Impairment loss on intangibles | - | (1) | - | |
Loss before tax expense | (3 974) | (1 253) | (7 009) | |
Tax | - | - | (580) | |
Loss for the year after tax expense | (3 974) | (1 253) | (7 589) | |
OTHER COMPREHENSIVE INCOME | ||||
Exchange gain on translation of foreign subsidiaries | (5 251) | - | 4 116 | |
Total comprehensive loss for the year | (9 225) | - | (3 473) | |
Loss attributable to: | ||||
Equity shareholders | (3 348) | (1 253) | (6 821) | |
Non-controlling interest | (626) | - | (768) | |
(3 974) | (1 253) | (7 589) | ||
Total comprehensive income attributable to: | ||||
Equity shareholders | (8 599) | (1 253) | (2 705) | |
Non-controlling interest | (626) | - | (768) | |
(9 225) | (1 253) | (3 473) | ||
Earnings per share | ||||
Basic and diluted loss per share (pence) | (1.24) | (0.76) | (2.67) | |
'000 | '000 | '000 | ||
Number of shares in issue | 288 122 | 256 536 | 256 536 | |
Weighted average number of shares in issue | 270 269 | 165 593 | 255 835 | |
CONSOLIDATED AND COMPANY STATEMENTS OF FINANCIAL POSITION
As at 31 December 2011
31 DEC 2011 | 31 DEC 2010 | 30 JUN 2011 | |||
Unaudited | Unaudited | Audited | |||
'000 | '000 | '000 | |||
ASSETS | |||||
| |||||
Intangible assets | 84 277 | 86 125 | 88 222 | ||
Property, Plant and equipment | 13 445 | 10 406 | 15 360 | ||
Deferred tax | 519 | - | 519 | ||
Total non-current assets | 98 241 | 96 531 | 104 101 | ||
Current assets | |||||
Trade and other receivables | 1 762 | 3 025 | 3 121 | ||
Inventory | 884 | 956 | 830 | ||
Cash and cash equivalents | 2 315 | 9 987 | 2 007 | ||
Total current assets | 4 961 | 13 968 | 5 958 | ||
TOTAL ASSETS | 103 202 | 110 499 | 110 059 | ||
LIABILITIES | |||||
Non-current liabilities | |||||
Loans to and from related parties | - | - | - | ||
Long-term liabilities | (1 690) | - | (2 504) | ||
Deferred tax | (18 231) | (16 575) | (18 240) | ||
Total non-current liabilities | (19 921) | (16 575) | (20 744) | ||
Current liabilities | |||||
Contingent/Deferred consideration | (1 400) | - | |||
Loans to and from related parties | (1 455) | (1 280) | |||
Trade and other payables | (1 273) | (4 226) | (2 575) | ||
Short term Liabilities Tax | (878) (625) | - - | (981) (625) | ||
Total current liabilities | (4 231) | (5 626) | (5 461) | ||
TOTAL LIABILITIES | (24 152) | (22 201) | (26 205) | ||
NET ASSETS | 79 050 | 88 298 | 83 854 | ||
EQUITY | |||||
Share capital | 2 881 | 2 565 | 2 565 | ||
Share premium | 61 701 | 57 595 | 57 595 | ||
Merger reserve | 23 184 | 23 184 | 23 184 | ||
Share based payments reserve | 5 171 | 3 548 | 5 171 | ||
Currency translation reserve | 9 252 | 15 607 | 14 503 | ||
Retained deficit | (24 405) | (14 201) | (21 057) | ||
TOTAL EQUITY | 77 784 | 88 298 | 81 962 | ||
Equity interest of non-controlling interest | 1 266 | - | 1 892 | ||
NET EQUITY | 79 050 | 88 298 | 83 854 | ||
CONSOLIDATED AND COMPANY STATEMENTS OF CASH FLOWS
For the period ended 31 December 2011
Six months ended | Year ended | ||||||||
31 DEC 2011 | 31 DEC 2010 | 30 JUN 2011 | |||||||
Unaudited | Unaudited | Audited | |||||||
'000 | '000 | '000 | |||||||
Cash flows from operating activities | |||||||||
Loss for the year | (3 974) | (1 253) | (7 009) | ||||||
Finance income | (15) | 46 | (149) | ||||||
Finance expense | 187 | - | 648 | ||||||
Depreciation | 727 | 22 | 1 278 | ||||||
Share based payment | - | 543 | 766 | ||||||
Other non-cash movements | - | 5 220 | - | ||||||
Impairment of intangibles | - | - | - | ||||||
Amortisation of intangibles | 520 | 545 | 1 221 | ||||||
Profit on sale of property, plant and equipment | - | - | - | ||||||
(Increase) / Decrease in inventory | (54) | (274) | (148) | ||||||
(Increase) / Decrease in receivables | 1 359 | 5 334 | (2 191) | ||||||
(Decrease) / Increase in payables | (1 302) | 2 459 | (1 321) | ||||||
Net cash from operating activities | (2 552) | 12 642 | (6 905) | ||||||
Cash flows from investing activities | |||||||||
Increase in loans and investments | - | (465) | - | ||||||
Acquisition of subsidiary, net of cash acquired | - | - | (6 578) | ||||||
Acquisition of non-controlling interest | - | - | - | ||||||
Proceeds from sale of property, plant and equipment | - | - | - | ||||||
Funding of deposit account for business combination | - | - | 7 652 | ||||||
(Purchase) / disposal of intangible fixed assets | (899) | (5 419) | (2 284) | ||||||
Purchase of property, plant and equipment | (663) | (10 406) | (1 472) | ||||||
Net cash used in investing activities |
| (1 562) | (16 290) | (2 682) | |||||
Cash flows from financing activities | |||||||||
Issue of shares and warrants | 4 422 | 638 | - | ||||||
Issue costs | - | - | |||||||
Acquisition of non-controlling interest | - | (1 640) | |||||||
Net cash generated from financing activities | 4 422 | 638 | (1 640) | ||||||
Net (decrease) / increase in cash and cash equivalents | 308 | (3 010) | (11 227) | ||||||
Cash and cash equivalents at beginning of the year | 2 007 | 12 997 | 12 997 | ||||||
Effects of foreign exchange on cash and cash equivalents | 237 | ||||||||
Cash and cash equivalents at the end of the year | 2 315 | 9 987 | 2 007 | ||||||
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the period ended 31 December 2011
Share capital |
Share premium | Merger reserve | Share based payment reserve | Currency translation reserve | Retained deficit |
Non- controlling interest | Total equity | ||
Group | £'000
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Balance at 1 July 2010 | 2 545 | 56 977 | 23 184 | 3 005 | 10 387 | (12 948) | - | 83 150 | |
Issue of share capital | 20 | 618 | - | - | - | - | - | 638 | |
Share-based payment charge | - | - | - | 766 | - | - | - | 766 | |
Deferred consideration transferred | - | - | - | 1 400 | - | - | - | 1 400 | |
Total comprehensive loss for the year | - | - | - | - | 4 116 | (6 821) | (768) | (3 473) | |
Acquistion of subsidiary | - | - | - | - | - | - | 3 012 | 3012 | |
Acquisition of non-controlling interest | - | - | - | - | - | (1 288) | (352) | (1 640) | |
Balance at 30 June 2011 | 2 565 | 57 595 | 23 184 | 5 171 | 14 503 | (21 057) | 1 892 | 83 854 | |
Issue of share capital | 316 | 4 106 | - | - | - | - | 4 422 | ||
Share-based payment charge | - | - | - | - | - | - | - | ||
Total comprehensive loss for the year | - | - | - | - | (5 251) | (3 348) | (626) | (9 225) | |
Acquisition of subsidiary | - | - | - | - | - | - | - | - | |
Acquisition of non-controlling interest | - | - | - | - | - | - | - | - | |
Balance at 31 December 2011 | 2 881 | 61 701 | 23 184 | 5 171 | 9 252 | (24 405) | 1 266 | 79 050 | |
Notes to Interim Financial Statements
1. Basis of preparation
These financial statements have been prepared in accordance with the framework concepts and the measurement and recognition requirements of IFRS and the AC 500 standards as issued by the accounting practices board and containing the information required by IAS 34: Interim Financial Reporting.
The accounting policies have been applied consistently throughout the Group and are consistent with those for the financial year ended 31 June 2011.
2. Commitments and contingencies
There are no material contingent assets or liabilities at 31 December 2011.
Capital commitments at 31 December 2011
DEC 2011 | JUN 2011 | |
£'000 | £'000 | |
Not longer than one year | 22 | 22 |
Longer than one year and not longer than five years | 48 | 59 |
Total | 70 | 81 |
3. Dividend
No Dividends were declared during the period ended 31 December 2011.
4. Board
No changes were made to the Board of Directors.
5. Business segments
In the opinion of the Directors, the operations of the Group companies comprise five reporting segments, being
·; the evaluation and development of PGM smelters utilising exclusive commercialisation rights of the ConRoast smelting process, located in South Africa ("Evaluation and Development"),
·; the evaluation of the reclamation and processing of sulphide nickel tailings at BHP Billiton's Leinster, Kambalda and Mount Keith properties in Australia ("Nickel tailings"), and
·; Development of Platinum Group Elements (PGE's) and associated metals ("PGE development").
·; Base Metal Smelting in South Africa
·; Electricity Generation
The Parent Company operates a head office based in the United Kingdom which incurred certain administration and corporate costs. The Group's operations span five countries, South Africa, Australia, Madagascar, Mauritius and the United Kingdom. There is no difference between the accounting policies applied in the segment reporting and those applied in the Group financial statements. Mauritius and Madagascar do not meet the qualitative threshold under IFRS 8 consequently no separate reporting is provided.
South Africa Evaluation and development Year ended 31 December 2011 | Australia Nickel tailings Year ended 31 December 2011 | South Africa PGE development Year ended 31 December 2011 | Corporate (Unallocated) Year ended 31 December 2011 | South Africa Base Metal Smelting Year ended 31 December 2011 | South Africa Electricity Generation Year ended 31 December 2011 | Total Year ended 31 December 2011 | |
£ | £ | £ | £ | £ | £ | £ | |
Total revenues | - | - | - | - | 2,263 | 1,181 | 3,444 |
Intercompany revenue | - | - | - | - | (947) | (1,181) | (2,128) |
Revenue from external customers | - | - | - | - | 1,316 | - | 1,316 |
Loss before taxation | (690) | (54) | (143) | (805) | (2,772) | 490 | (3,974) |
Taxation | - | - | - | - | - | - | - |
Loss after taxation | (690) | (54) | (143) | (805) | (2,772) | 490 | (3,974) |
Interest received | 10 | - | - | 5 | - | - | 15 |
Interest paid | - | - | - | 10 | - | 177 | 187 |
Depreciation and Amortisation | 525 | - | 5 | 1 | 507 | 209 | 1,247 |
Total assets | 46,164 | 23,756 | 11,929 | 2,943 | 12,117 | 6,293 | 103,202 |
Total liabilities | - | (6) | (14) | (18,785) | (5,344) | (3) | (24,152) |
South Africa Evaluation and development Year ended 30 June 2011 | Australia Nickel tailings Year ended 30 June 2011 | South Africa PGE development Year ended 30 June 2011 | Corporate (Unallocated) Year ended 30 June 2011 | South Africa Base Metal Smelting Year ended 30 June 2011 | South Africa Electricity Generation Year ended 30 June 2011 | Total Year ended 30 June 2011 | |
£ | £ | £ | £ | £ | £ | £ | |
Total revenues | - | - | 2,515 | - | 4,404 | 1,890 | 8,808 |
Intercompany revenue | - | - | - | - | (1,416) | (1,890) | (4,793) |
Revenue from external customers | - | - | 2,515 | - | 2,988 | - | 5,503 |
Loss before taxation | (482) | 60 | (1,451) | (1,756) | (3,608) | 288 | (7,009) |
Taxation | - | (24) | - | (1) | (419) | (136) | (580) |
Loss after taxation | (482) | 36 | (1,451) | (1,756 | (4,027) | 92 | (7,589) |
Interest received | - | - | 68 | 72 | - | 9 | 149 |
Interest paid | - | - | - | - | 4 | 643 | 647 |
Depreciation and Amortisation | 11 | 6 | 1,168 | 8 | 1,090 | 216 | 2,499 |
Total assets | 48,141 | 24,964 | 12,438 | 3,127 | 11,931 | 6,563 | 107,163 |
Total liabilities | (756) | (3) | (310) | (18,731) | (3,971) | (3,359) | (27,131) |
South Africa Evaluation and development | Australia Nickel tailings | South Africa PGE development | Corporate (Unallocated) | South Africa Base Metal Smelting | South Africa Electricity Generation | Total | |
Year ended 31 December | Year ended 31 December | Year ended 31 December | Year ended 31 December | Year ended 31 December | Year ended 31 December | Year ended 31 December | |
2010 | 2010 | 2010 | 2010 | 2010 | 2010 | 2010 | |
£ | £ | £ | £ | £ | £ | £ | |
Loss on ordinary activities | - | 40 | (95) | (1,198) | - | - | (1,253) |
Total assets | - | 18,396 | 64,177 | 5,725 | - | - | 88,298 |
6. Loss per share and headline loss per share
The loss at 31 December 2011 to shareholders is £3,348 million (31 DEC 2010 loss £1,253 million). This is divided by the weighted average number of ordinary shares in issue calculated to be 270,269,750 (31 DEC 2011 163,593,604).
The fully diluted loss per share is based on the loss for the financial year divided by the weighted average number of shares and potential shares being 270,269,750 (DEC 2010: 163,593,604) in issue during the year. As the options are non-dilutive, no diluted loss per share has been calculated.
DEC 2011 '000 | DEC 2010 '000 | |
Ordinary shares (weighted average) | 270,270 | 163,594 |
Effect of options issued at fair value (weighted average) | - | - |
270,270 | 163,594 |
RECONCILIATION OF HEADLINE LOSS |
DEC 2011 '000 | DEC 2010 '000 |
Loss attributable to Jubilee Platinum Plc shareholders | (3,348) | (1,253) |
Impairment of assets | - | - |
Loss on disposal of foreign subsidiary | - | - |
Loss on disposal of plant and equipment | - | - |
Headline loss | (3,348) | (1,253) |
Headline loss per share (pence) | (1.24) | (0.76) |
Diluted loss earnings per share (pence) | (1.24) | (0.76) |
7. Shares Issued
In October, the Company raised £4.422 million through a placing with major institutions of 31,585,714 new ordinary shares of 1 pence each in the Company at 14 p per share representing a 12% premium to the then prevailing market price.
8. Interim Report
Copies of the interim report are available to the public free of charge from the Company at 4th Floor, Cromwell Place, London, SW7 2Je and from Building B, 1st Floor, corner Witkoppen Road and Waterford Place, Paulshof, Johannesburg, during normal office hours for 30 days from the date of this report and available for download from www.jubileeplatinum.com
Enquiries:
Jubilee Platinum plc
Colin Bird/Leon Coetzer/Andrew Sarosi
Tel +44 (0) 20 7584 2155 / Tel +27 (0) 11 465 1913/+44 (0) 1752 221937
finnCap Ltd
Matthew Robinson/Ben Thompson - corporate finance
Joanna Weaving - corporate broking
Tel +44 (0) 20 7220 0500
Shore Capital Stockbrokers Limited (Joint Broker)
Jerry Keen/ Edward Mansfield
Tel: +44 (0) 20 7 408 4090
Sasfin Capital
Leonard Eiser /Sharon Owens
Tel +27 (0) 11 809 7500
Bishopsgate Communications Ltd
Nick Rome/Shabnam Bashir
Tel +44 (0) 20 7562 3350