Zimplats quarterly production up 19%, as revenue dip 41%


Zimplats slips to $33mln loss as quarterly sales fall 35pct

ZIMPLATS  production in the quarter to 30 June 2015 increased 19% to 1 480 000 tonnes from 1 244 000 in the previous quarter largely as a result of 105 693 tonnes mined from the open-pit operation as well as a general increase in production from the underground mines.

In its quarterly update, the platinum mining company said the open-pit operation started producing ore in April 2015 and is operating at the design capacity of 830 000 tonnes per annum.

The volume of ore milled increased 13% to 1 422 000 tonnes from 1 263 000 tonnes in the previous quarter due to improved ore supplies. This resulted in 4E metal in concentrate production increasing 12% from the previous quarter at 119 426 tonnes.

The company said the redevelopment work at Bimha Mine is progressing well with 87 000 tonnes mined from the access drives and access points in the quarter and the project is on schedule to reach full production in April 2018.

Overall 4E head grade marginally changed from the previous quarter to 3.22 from 3.23 in the last quarter, despite lower grades from the opencast mining area.

Zimplats said 4E metal recovery rate deteriorated marginally by 1% from the previous quarter due to the reduction in mass pull to align the concentrate volumes produced with the existing smelter capacity.

The company said at the end of the quarter 11 413 tonnes of concentrates produced during the smelter outage were stockpiled.

The concentrate were produced after on 18 May 2015 a break out occurred on the furnace sidewall and molten material flowed from the furnace onto the tapping platform and into the converter aisle, which damaged some ancillary equipment.

“No employees were injured due to the successful evacuation and processes implemented by the operation. The furnace was repaired and returned to full power at the end of June 2015.

“Investigations into the possible causes of the furnace failure are in progress together with the furnace designers, furnace reline specialist and internal technical teams,” says the company.

Accordingly, this resulted in 22 341 tonnes of concentrates smelted producing 71 084 ounces of 4E in converter matte, which is 32% lower than the 104 735 ounces produced in the previous quarter.

Meanwhile, revenue decreased 41% to $64 646 mln from the previous quarter’s $110 219 mln due to a 35% decrease in 4E sales volume and a drop in the metal prices.

The company says direct operating costs were 20% lower at $95 612 mln from $100 697 mln in the previous quarter due to the decrease in overall sales volumes.

Cash cost per 4E ounce increased 12% to 887 from the previous quarter largely due to the 32% decrease in 4E metal in converter matte production and the provision for retrenchment costs.

The company said during the quarter, local spend in Zimbabwe excluding payments to government and related institutions increased 24% to $46 million and total payments to government in direct and indirect taxes decreased 18% to $7 million compared to the previous quarter mainly due to a reduction in royalties in line with lower sales revenue.

However, the Mine said development of Mupfuti Mine to full production after implementation of the new pillar design is progressing well and is targeted for completion in 2016.

On other hand, the project to refurbish the mothballed SMC BMR is in progress and is scheduled for commissioning by July 2016. -FinX