TIDMPPN
RNS Number : 5713G
Platmin Limited
13 May 2011
Platmin Limited
Condensed Consolidated Interim Financial Statements
for the three months ended March 31, 2011
(Unaudited, expressed in United States dollars, unless otherwise
stated)
Condensed consolidated interim statement of financial
position
as on March 31, 2011
(Unaudited, expressed in U.S. dollars, unless otherwise
stated)
Mar 31, Dec 31,
2011 2010
Notes $ 000 $ 000
--------------------------------------------- --------- --------- ---------
ASSETS
Non-current assets
Mining assets 39,388 49,886
Intangible assets 5 38,590 14,019
Property, plant and equipment 6 570,494 578,550
Loans receivable 63 63
Restricted cash investments and guarantees 8 170,841 84,471
Total non-current assets 819,376 726,989
--------------------------------------------- --------- --------- ---------
Current assets
Inventories 7 12,303 11,285
Accounts and other receivables 42,839 46,877
Restricted cash 8 - 135,131
Cash and cash equivalents 9 177,248 188,596
--------------------------------------------- --------- --------- ---------
Total current assets 232,390 381,889
--------------------------------------------- --------- --------- ---------
TOTAL ASSETS 1,051,766 1,108,878
============================================= ========= ========= =========
EQUITY AND LIABILITIES
Equity attributable to owners of the
parent
Share capital 10 891,551 756,579
Accumulated deficit (118,221) (90,419)
Other components of equity 190,107 198,352
--------------------------------------------- --------- --------- ---------
963,437 864,512
Non-controlling interests (37,148) (30,116)
--------------------------------------------- --------- --------- ---------
Total equity 926,289 834,396
--------------------------------------------- --------- --------- ---------
Non-current liabilities
Long-term borrowings 11 17,179 4,710
Finance lease liability 12 9,067 9,410
Decommissioning and rehabilitation
provision 13 76,077 70,705
--------------------------------------------- --------- --------- ---------
Total non-current liabilities 102,323 84,825
--------------------------------------------- --------- --------- ---------
Current liabilities
Trade payables and accrued liabilities 18,059 20,747
Revolving commodity facility 14 4,899 3,468
Current portion of finance lease
liability 12 196 291
Current portion of long-term borrowings 15 - 31,923
Convertible debenture 16 - 133,228
--------------------------------------------- ---------
Total current liabilities 23,154 189,657
--------------------------------------------- --------- --------- ---------
Total liabilities 125,477 274,482
--------------------------------------------- --------- --------- ---------
TOTAL EQUITY AND LIABILITIES 1,051,766 1,108,878
============================================= ========= ========= =========
NATURE OF OPERATIONS AND GOING CONCERN 1
The accompanying notes are an integral part of the condensed
consolidated interim financial statements
Condensed consolidated interim statement of income
for the three months ended March 31, 2011
(Unaudited, expressed in U.S. dollars, unless otherwise
stated)
For the three months ended
Mar 31, Mar 31,
2011 2010
Notes $ 000 $ 000
--------------------------------------- ------ --------------- ------------
Revenue 26,038 -
Cost of operations 17 (50,294) -
--------------------------------------- ------ --------------- ------------
Operating loss (24,256) -
Administrative and general expenses 18 (3,327) (4,393)
Other expenses 18 (6,752) (9)
Finance income 1,790 316
Finance costs (2,289) (1,095)
--------------------------------------- ------ --------------- ------------
Loss before taxation (34,834) (5,181)
Income tax expense - -
--------------------------------------- ------ --------------- ------------
LOSS FOR THE PERIOD (34,834) (5,181)
======================================= ====== =============== ============
Loss attributable to:
Owners of the parent (27,802) (3,597)
Non-controlling interest (7,032) (1,584)
--------------------------------------- ------ --------------- ------------
(34,834) (5,181)
======================================= ====== =============== ============
Loss per share (in currency units)
attributable to owners of the parent: $ $
--------------- ------------
Basic and diluted 19 (0.04) (0.01)
--------------------------------------- ------ --------------- ------------
The accompanying notes are an integral part of the condensed
consolidated interim financial statements
Condensed consolidated interim statement of comprehensive
income
for the three months ended March 31, 2011
(Unaudited, expressed in U.S. dollars, unless otherwise
stated)
For the three months ended
Mar 31, Mar 31,
2011 2010
Notes $ 000 $ 000
---------------------------------------------- --------------- ------------
Loss for the period (34,834) (5,181)
Other comprehensive income (net of tax) 22,621 (2,592)
----------------------------------------------- --------------- ------------
Exchange differences on translation from
functional to presentation currency 22,621 (2,592)
Income tax relating to components of
other comprehensive income - -
-------------------------------------- ------- --------------- ------------
TOTAL COMPREHENSIVE LOSS FOR THE PERIOD (12,213) (7,773)
=============================================== =============== ============
Total comprehensive loss attributable
to:
Owners of the parent (5,181) (6,189)
Non-controlling interest (7,032) (1,584)
----------------------------------------------- --------------- ------------
(12,213) (7,773)
---------------------------------------------- --------------- ------------
The accompanying notes are an integral part of the condensed
consolidated interim financial statements
Condensed consolidated interim statement of changes in
shareholders' equity
for the three months ended March 31, 2011
(Unaudited, expressed in U.S. dollars, unless otherwise
stated)
Equity attributable to the shareholders
------------------------------------------------------------------
Share Foreign
Based Currency
Share Payment Translation Non-controlling Total
Capital Deficit Reserve Warrants Reserve Subtotal interest Equity
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
------------------ -------- ---------- -------- --------- ------------ --------- ---------------- ---------
Balance at
December 31,
2009 425,535 (35,002) 10,167 846 71,574 473,120 (20,091) 453,029
Shares issued - - - - - - - -
Loss for the
period - (3,597) - - - (3,597) (1,584) (5,181)
Stock based
compensation - - 513 - - 513 - 513
Other
comprehensive
income:
Currency
translation
adjustment - - - - 2,592 2,592 - 2,592
------------------ -------- ---------- -------- --------- ------------ --------- ---------------- ---------
Balance at
March 31,
2010 425,535 (38,599) 10,680 846 74,166 472,628 (21,675) 450,953
================== ======== ========== ======== ========= ============ ========= ================ =========
Equity attributable to the shareholders
------------------------------------------------------------------
Share Foreign
Based Currency
Share Payment Translation Non-controlling Total
Capital Deficit Reserve Warrants Reserve Subtotal interest Equity
$ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000 $ 000
------------------ -------- ---------- -------- --------- ------------ --------- ---------------- ---------
Balance at
December 31,
2010 756,579 (90,419) 42,228 846 155,278 864,512 (30,116) 834,396
Shares issued 134,972 - - - - 134,972 - 134,972
Loss for the
period - (27,802) - - - (27,802) (7,032) (34,834)
Stock based
compensation - - 14,376 - - 14,376 - 14,376
Other
comprehensive
income:
Currency
translation
adjustment - - - - (22,621) (22,621) - (22,621)
------------------ -------- ---------- -------- --------- ------------ --------- ---------------- ---------
Balance at
March 31,
2011 891,551 (118,221) 56,604 846 132,657 963,437 (37,148) 926,289
================== ======== ========== ======== ========= ============ ========= ================ =========
Note 10
------------------ -------- ---------- -------- --------- ------------ --------- ---------------- ---------
The accompanying notes are an integral part of the condensed
consolidated interim financial statements
Condensed consolidated interim statement of cashflows
for the three months ended March 31, 2011
(Unaudited, expressed in U.S. dollars, unless otherwise
stated)
For the three
months ended
Mar Mar
31, 31,
2011 2010
Notes $ 000 $ 000
------------------------------------------- ------ --------- ---------
Cash flows from operating activities
------------------------------------------- ------ --------- ---------
Cash receipts from customers 30,205 15,708
Cash paid to suppliers and employees (48,568) (42,167)
------------------------------------------- ------ --------- ---------
Cash utilized in operations (18,363) (26,459)
Interest received 694 (56)
Interest paid (330) -
------------------------------------------- ------ --------- ---------
Net cash used in operating activities (17,999) (26,515)
------------------------------------------- ------ --------- ---------
Cash flows from investing activities
------------------------------------------- ------ --------- ---------
Purchase of property, plant and equipment (360) (1,217)
Purchase of Sedibelo West (79,666) -
Additions to intangible assets (12,142) (98)
Increase in rehabilitation investment (5,732) (492)
Increase in deferred exploration
expenses (205) (413)
------------------------------------------- ------ --------- ---------
Net cash used in investing activities (98,105) (2,220)
------------------------------------------- ------ --------- ---------
Cash flows from financing activities
------------------------------------------- ------ --------- ---------
Increase in loans payable - 12,824
Decrease in finance lease liability (463) (460)
Increase in revolving commodity facility 576 4,964
Realised foreign exchange gains (1,601) (1)
Repayment of promissory note (29,106) -
Proceeds from issue of shares 131,130 -
------------------------------------------- ------ --------- ---------
Net cash generated from financing
activities 100,536 17,327
------------------------------------------- ------ --------- ---------
Net decrease in cash and cash equivalents (15,568) (11,408)
Net foreign exchange differences 4,220 (75)
Cash and cash equivalents at the
beginning of the period 9 188,596 29,375
------------------------------------------- ------ --------- ---------
Cash and cash equivalents at the
end of the period 9 177,248 17,892
=========================================== ====== ========= =========
The accompanying notes are an integral part of the condensed
consolidated interim financial statements
Notes to the condensed consolidated interim financial
statements
for the three months ended March 31, 2011
(Unaudited, expressed in U.S. dollars, unless otherwise
stated)
1. Nature of operations and going concern
Platmin Limited ("the Company") and its subsidiaries ("the
Group") is a Natural Resources Group engaged in the acquisition,
exploration, development and operation of Platinum Group Elements
("PGE") properties in the Republic of South Africa.
The Company was incorporated under the Canada Business
Corporation Act on May 29, 2003. The Company has continued as a
company under the Business Corporations Act of British Columbia,
Canada, effective April 1, 2009. Its Common Shares are listed on
the Toronto Stock Exchange ("TSX") and the Alternative Investment
Market of the London Stock Exchange ("AIM"). The Company trades
under the symbol "PPN" on both exchanges. On July 22, 2009, the
Company listed on the Johannesburg Securities Exchange Limited
("JSE") under the symbol "PLN".
These condensed consolidated interim financial statements have
been prepared using International Financial Reporting Standards
("IFRS") applicable to a going concern, which contemplates the
realization of assets and settlement of liabilities in the normal
course of business as they become due.
For the three months ended March 31, 2011 the Group incurred a
loss of US$34.834 million and as at March 31, 2011 had an
accumulated deficit of US$118.221 million. The Group is dependent
on the successful operation of the Pilanesberg Platinum Mine
("PPM") to generate cash flows in order to fund its operations and
pay debt as it becomes due. Such circumstances may cast significant
doubt as to the ability of the Group to meet its obligations as
they become due and accordingly the appropriateness of the use of
the accounting principles applicable to a going concern.
The Group increased its equity with US$135.000 million by way of
conversion of the convertible debenture on March 31, 2011 and had
US$177.248 million in cash and cash equivalents at March 31, 2011
to fund mining activities and meet its contractual obligations.
The Company's financing efforts to date, while substantial, may
not be sufficient in and of themselves to enable the Company to
fund all aspects of its operations when taking into consideration
forecasted revenue streams based upon planned production.
Management expects that the Company will be able to secure the
necessary financing to meet the Company's requirements on an
ongoing basis. Nevertheless, there is no assurance that these
initiatives will be successful or sufficient. If the going concern
assumption were not appropriate for these condensed consolidated
interim financial statements, then adjustments to the carrying
values of the assets and liabilities, the reported expenses and the
statement of financial position classifications, which could be
material, may be necessary.
2. Statement of compliance
The unaudited condensed consolidated interim financial
statements for the three months ended March 31, 2011 have been
prepared in accordance with the recognition and measurement
requirements of IFRS and the presentation and disclosure
requirements of International Accounting Standard ("IAS") 34
Interim Financial Reporting. These interim results do not include
all the information required for the full annual financial
statements, and should be read in conjunction with the consolidated
financial statements of the Group as at and for the year ended
December 31, 2010.
The unaudited condensed consolidated interim financial
statements, which have been prepared on the going concern basis,
were approved by the Board of Directors on May 10, 2011.
This set of unaudited condensed consolidated interim financial
statements has not been audited by the Group's auditors and thus no
audit report was issued.
The financial statements are presented in US dollars, rounded to
the nearest thousand.
3. Accounting policies
The accounting policies applied by the Group in these unaudited
condensed consolidated interim financial statements are consistent
with those applied by the Group in its consolidated financial
statements as at and for the year ended December 31, 2010.
Upon declaring commercial production on January 1, 2011, the
useful life of assets has been calculated in accordance with the
table as detailed below.
Property plant and equipment
Depreciation and amortization are calculated on a
units-of-production method for the mining assets and straight-line
method for all other assets to write off the cost of the assets to
their residual values over their estimated useful lives. The
depreciation and amortization rates applicable to each category of
property, plant and equipment are as follows:
Useful life
Asset category (Years)
Vehicles 5
Computer equipment 3
Office equipment 6
Furniture and fittings 6
Other equipment 5
Buildings 20
Leasehold improvements 5
Plant and equipment Units of production
(ore tonnes processed)
Deferred stripping costs, decommissioning Units of production
assets (ore tonnes mined)
Producing mines (exploration Units of production
and evaluation assets) (ore tonnes mined)
4. Segmented information
Management has determined the operating segments based on the
reports reviewed by the Executive Committee ("the Committee") that
are used to make strategic decisions.
The Committee considers the business from an operating
perspective. The Group operates in one geographic segment, the
Republic of South Africa. The operating segments comprise the
following:
Mining operation: PPM declared commercial production on January
1, 2011. This mine is involved in the mining and processing of
platinum group elements.
Development and exploration operations: The Group is engaged in
a number of other development and exploration projects within the
Republic of South Africa.
Administrative operations: The Group administration is done at
the local corporate office based in Centurion, the Metropolitan
City of Tshwane in the Republic of South Africa.
Although the development and exploration as well as
administrative operations do not meet the quantitative thresholds
required by IFRS 8 - Segment reporting, management has concluded
that these segments should be reported, as it is closely monitored
by the Committee. The development and exploration segment is
earmarked as the growth area for the Group.
The segment information provided to the committee for the
reportable segments for the three month periods ended is as
follows:
Development
Mining and exploration Administration Consolidated
Mar Mar Mar Mar Mar Mar Mar Mar
Amounts in 31, 31, 31, 31, 31, 31, 31, 31,
$ '000 2011 2010 2011 2010 2011 2010 2011 2010
-------------- --------- --------- ------- -------- --------- -------- ---------- ---------
Reportable items in the Statement of Comprehensive
Income
External
revenues 26,038 18,503 - - - - 26,038 18,503
Intersegment
revenue - - - - - - - -
Adjusted
EBITDA (21,886) (19,320) - - (16,411) (2,457) (38,297) (21,777)
============== ========= ========= ======= ======== ========= ======== ========== =========
Reportable items in the Statement of Financial Position
Total assets 714,045 513,140 31,950 37,292 305,771 26,140 1,051,766 576,572
Additions to
non-current
assets 4,748 1,217 24,234 905 1 98 28,983 2,220
Total
liabilities 106,666 118,932 17,343 4,039 1,468 2,646 125,477 125,617
-------------- --------- --------- ------- -------- --------- -------- ---------- ---------
The amounts provided to the committee with respect to total
assets and total liabilities are measured in a manner consistent
with that of the financial statements. These assets and liabilities
are allocated based on the operations of the segment. There were no
impairments during the current or prior reportable periods.
Additions to non-current assets include all additions to mining
assets, intangible assets and property, plant and equipment.
A reconciliation of adjusted EBITDA to total comprehensive
(loss)/income for the period is provided as follows:
Consolidated
Mar Mar
31, 31,
2011 2010
$'000 $'000
----------------------------------------------- --------- ---------
Total EBITDA for reportable segments (38,297) (21,777)
Revenues offset against the cost of the
plant construction (3,410) (18,503)
Mining costs offset against the cost of
the plant construction - 36,023
----------------------------------------------- --------- ---------
Total EBITDA per Consolidated statement
of income and comprehensive income (41,707) (4,257)
Foreign exchange gains 7,812 (9)
Depreciation (440) (136)
Finance costs (net) (499) (779)
----------------------------------------------- --------- ---------
Loss before taxation (34,834) (5,181)
Income tax expense -
Exchange differences on translating from
functional currency to presentation currency 22,621 (2,592)
----------------------------------------------- --------- ---------
Total comprehensive loss for the period (12,213) (7,773)
----------------------------------------------- --------- ---------
5. Intangible assets
As at Mar As at Dec
31, 31,
2011 2010
$ 000 $ 000
--------------------------------- --------- ----------------
Water pipeline 12,724 13,070
ERP software 828 886
Computer software 56 63
Power and water rights 24,982 -
--------------------------------- --------- ----------------
Balance at the end of the period 38,590 14,019
--------------------------------- --------- ----------------
Reconciliation of intangible assets:
Water ERP Computer Power and
pipeline Software software $ water rights TOTAL
$ 000 $ 000 000 $ 000 $ 000
------------- ------------- ------------ ----------- ------------- -------------
Balance as at
December 31,
2009 8,479 772 97 - 9,348
Additions
during the
period 1,228 169 43 - 1,440
Reclassified
from
receivables 2,064 - - - 2,064
Amortization
for the
period - (132) (80) - (212)
Foreign
exchange
variance 1,299 77 3 - 1,379
------------- ------------- ------------ ----------- ------------- -------------
Balance as at
December 31,
2010 13,070 886 63 - 14,019
Additions
during the
period - - 4 24,050 24,054
Amortization
for the
period - (34) (10) - (44)
Foreign
exchange
variance (346) (24) (1) 932 561
Balance as at
March 31,
2011 12,724 828 56 24,982 38,590
------------- ------------- ------------ ----------- ------------- -------------
PPM entered into an agreement with The Board of Magalies Water,
a State-owned water board operating under the Water Services Act,
Number 108 of 1997 as amended, ("Magalies Water") and other parties
to build a water pipeline and related infrastructure from the
Vaalkop Water Treatment Works to PPM. Upon completion, the
ownership of the water pipeline and related infrastructure will
remain with Magalies Water; however, PPM will have a right to use
9Ml a day through the pipeline for the entire life of mine.
Platmin concluded, through a special purpose vehicle ("SPV") in
which Platmin indirectly holds a 50% interest, to purchase certain
long lead items. These long lead items, consisting of the power and
water rights and obligations previously acquired by Barrick
Platinum SA (Pty) Ltd ("Barrick") in respect of the Sedibelo mining
area, form part of the Platmin acquisition of a portion of the
Sedibelo PGM Project concession ("Sedibelo West"). The acquisition
consideration for the transaction totalled US$24.050 million of
which Platmin paid 50%.
6. Property, plant and equipment
Plant
construction Deferred Decom-
and mine Plant and stripping missioning Producing Land and Other Leased
development equipment cost $ asset $ mines buildings $ assets TOTAL
$ 000 $ 000 000 000 $ 000 $ 000 000 $ 000 $ 000
------------- ------------- ---------- ---------- ----------- ---------- ---------- ------ ------- ---------
COST
Balance as
at December
31, 2009 407,789 - - - - 1,025 1,899 12,991 423,704
Additions 107,008 - - - - 55 561 - 107,624
Transfers (23) - - - - - 23 - -
Foreign
exchange
movement 48,107 - - - - 120 224 1,531 49,982
------------- ------------- ---------- ---------- ----------- ---------- ---------- ------ ------- ---------
Balance as
at December
31, 2010 562,881 - - - - 1,200 2,707 14,522 581,310
Transfers (562,881) 235,501 258,750 68,630 - - - - -
Transfers
from Mining
Assets - - - - 9,639 - - - 9,639
Revenue
adjustments - (3,410) - - - - - - (3,410)
Additions - 1,083 - 6,926 - 2 76 - 8,087
Foreign
exchange
movement - (6,415) (6,879) (1,823) (256) (30) (23) (386) (15,812)
------------- ------------- ---------- ---------- ----------- ---------- ---------- ------ ------- ---------
Balance as
at March
31, 2011 - 226,759 251,871 73,733 9,383 1,172 2,760 14,136 579,814
------------- ------------- ---------- ---------- ----------- ---------- ---------- ------ ------- ---------
ACCUMULATED
DEPRECIATION
ACCUMULATED
DEPRECIATION
Balance as at
December 31,
2009 - - - - - - 759 474 1,233
Depreciation for
the period - - - - - - 442 821 1,263
Foreign exchange
movement - - - - - - 122 142 264
----------------- --- ------ ------ ---- ---- ------ ------ ------
Balance as at
December 31,
2010 - - - - - - 1,323 1,437 2,760
Depreciation for
the period - 2,904 2,830 205 105 3 170 215 6,432
Foreign exchange
movement - 95 82 7 3 2 (29) (32) 128
----------------- --- ------ ------ ---- ---- ------ ------ ------
Balance as at
March 31, 2011 - 2,999 2,912 212 108 5 1,464 1,620 9,320
----------------- --- ------ ------ ---- ---- ------ ------ ------
Plant
construction Deferred Decom-
and mine Plant and stripping missioning Producing Land and Other Leased
development equipment cost $ asset $ mines buildings $ assets TOTAL
$ 000 $ 000 000 000 $ 000 $ 000 000 $ 000 $ 000
---------- ------------- ---------- ---------- ----------- ---------- ---------- ------ ------- --------
CARRYING
AMOUNTS
At
December
31,
2010 562,881 - - - - 1,200 1,384 13,085 578,550
---------- ------------- ---------- ---------- ----------- ---------- ---------- ------ ------- --------
At March
31,
2011 - 223,760 248,959 73,521 9,275 1,167 1,296 12,516 570,494
---------- ------------- ---------- ---------- ----------- ---------- ---------- ------ ------- --------
7. Inventories
As at As at
Mar 31, Dec 31,
2011 2010
$ 000 $ 000
------------ ------------- ---------------
At
cost
Ore
stockpiled 4,154 4,424
Work
in
progress 2,818 2,258
Consumables 5,331 4,603
Balance
at
the
end
of
the
period 12,303 11,285
------------ ------------- ---------------
8. Restricted cash
8.1 Restricted cash investments and guarantees - non-current
asset
Cash investments were made relating to certain guarantees
required by the Republic of South Africa's Department of Mineral
Resources ("DMR"), formerly known as the Department of Minerals and
Energy, and ESKOM Holdings Limited ("ESKOM"), the South African
state utility supplier of electricity, of which the details are as
follows:
-- Rehabilitation guarantees
The DMR requires rehabilitation guarantees for all prospecting
and mining rights. These rehabilitation guarantees primarily relate
to the mining rights for the Pilanesberg and Mphahlele Projects.
These guarantees have been provided to the DMR on two separate
basis:
- by the issuance of the guarantee by an insurance company, with
a portion of the total guarantee being paid over into a separate
bank account of the Group and ceded in favour of the insurance
company and the remaining portion paid in premiums to the insurance
company over the expected life of the mine; and
- on a cash backed basis.
-- ESKOM guarantees
-- On June 17, 2008 a guarantee was issued by Lombard Insurance
Company Limited ("Lombard Insurance"), to ESKOM to order critical
long lead time material for the construction of the electrical
substation at PPM. Lombard Insurance required cash collateral on a
portion of the guarantee. The cash collateral is held in a separate
bank account controlled by the Group and ceded in favour of Lombard
Insurance. The balance of the amount guaranteed by Lombard
Insurance is payable on a premium basis over 5 years and
re-assessed on an annual basis.
-- Escrow
On March 23, 2011, the Company entered into a transaction to
acquire an incremental 5.99 million 4E PGM inferred resource ounces
contained within Sedibelo West from the Bakgatla Ba Kgafela Tribe
and Itereleng Bakgatla Mineral Resources (Pty) Limited, for an
aggregate consideration of US$75.000 million in cash. The total
purchase price of US$82.000 million (including VAT of US$7.000
million on a portion of the purchase price) was classified as
restricted cash in anticipation of the transferring thereof to a
nominated Escrow account.
As at As at
Mar 31, Dec 31,
2011 2010
$ 000 $ 000
---------------- -------------- ---------------
Pilanesberg
rehabilitation
guarantee 80,549 76,430
ESKOM
capital
and
supply
guarantees 7,075 6,856
Mphahlele
rehabilitation
guarantee 1,111 1,077
Other
guarantees 106 108
Escrow
account
for
Sedibelo
transaction 82,000 -
Balance
at
the
end
of
the
period 170,841 84,471
---------------- -------------- ---------------
8.2 Restricted cash - current asset
As at As at
Mar 31, Dec 31,
2011 2010
$ 000 $ 000
------------- --------- ---------------
Cash
collateral
for
convertible
debentures - 135,131
Balance
at
the
end
of
the
period - 135,131
------------- --------- ---------------
On May 13, 2010, the Company issued US$135.000 million of
convertible debentures. The cash collateral represents the funds
received and the interest accrued thereon to date. The debentures
were converted on March 31, 2011.
9. Cash and cash equivalents
As at As at
Mar 31, Dec 31,
2011 2010
$ 000 $ 000
--------------- -------- ---------------
Cash
at
bank
and
on
hand 177,248 188,596
Total
cash
and
cash
equivalents 177,248 188,596
--------------- -------- ---------------
Cash at bank earns interest at a floating rate based on daily
bank deposit rates. Cash is deposited at reputable financial
institutions of a high quality credit standing within the Republic
of South Africa and their foreign affiliates in the United Kingdom.
The fair value of cash and cash equivalents equates the values as
disclosed in this note.
For the purpose of the condensed consolidated interim statement
of cash flows, cash and cash equivalents comprise only the cash at
bank and on hand line-item as disclosed for each period end
above.
10. Share capital
a) Common shares authorized
The Company has an unlimited number of common shares with no par
value.
b) Common shares issued
Movement during the year ended December Number Amount
31, 2010 of shares $000
----------------------------------------- ------------ --------
Balance, January 1, 2010 445,018,352 425,535
Common shares issued 304,662,415 331,044
Balance, December 31, 2010 749,680,767 756,579
========================================= ============ ========
Movement during the period ended
March 31, 2011
Balance, January 1, 2011 749,680,767 756,579
Common shares issued 160,714,286 134,972
-----------------------------------------
Balance, Mar 31, 2011 910,395,053 891,551
----------------------------------------- ------------ --------
On March 31, 2011, upon conversion of the convertible debenture
issued on May 13, 2010, the Company issued 160,714,286 new common
shares at a price of US$0.84 per common share for a total
consideration of US$135.000 million, raising US$134.972 million net
of legal fees.
11. Long term borrowings
As at As at
Mar 31, Dec 31,
2011 2010
$ 000 $ 000
------------- --------------- ------------
Corridor
Mining
Resources
(Pty)
Ltd 4,659 4,681
Perilya
Exploration
(Pty)
Ltd 29 29
SPV 12,491 -
------------- --------------- ------------
17,179 4,710
------------- --------------- ------------
The acquisition consideration for the long lead items purchased
from Barrick by the SPV (as disclosed in note 5) was funded through
shareholder loans advanced to the SPV. Platmin's portion of these
loans amounted to US$12,025 million. The remaining shareholder's
portion is US$12,491 million at the closing rate of ZAR6.7713 to
US$1.00
12. Finance lease liability
ESKOM designed and built an electrical installation adjacent to
PPM to produce the required electricity and maintains ownership and
control over all significant aspects of operating the facility.
Each month, PPM will pay a fixed capacity charge and a variable
charge based on actual electricity consumed. These payments attract
interest at the South African prime overdraft rate plus 2%.
The arrangement with ESKOM, entered into during the period under
review meet these requirements of IFRIC 4 - Arrangements containing
a lease, and therefore constitutes a lease and falls within the
scope of IAS 17 - Leases and is further classified as a finance
lease due to the sub-station being constructed exclusively for the
use of PPM. An asset (the electrical installation) is explicitly
identified in the arrangement and fulfilment of the arrangement is
dependent on the electrical installation.
Reconciliation between the total minimum lease payments and
their present value:
More
Up to 1 to than
1 year 5 years 5 years Total
$ 000 $ 000 $ 000 $ 000
------------------------ -------- --------- --------- ---------
Minimum lease payments 1,072 7,144 11,767 19,983
Finance cost (876) (6,295) (3,549) (10,720)
------------------------
Present value 196 849 8,218 9,263
------------------------ -------- --------- --------- ---------
13. Decommissioning and rehabilitation provision
As at As at
Mar Dec
31, 31,
2011 2010
$ 000 $ 000
---------------------------------------- -------- -------
Balance at the beginning of the period 70,705 52,744
Increase in liability for the period 6,936 10,435
Unwinding of interest (accretion) 316 1,307
---------------------------------------- -------- -------
77,957 64,486
Effect of exchange rate changes (1,880) 6,219
---------------------------------------- -------- -------
Balance at the end of the period 76,077 70,705
---------------------------------------- -------- -------
The estimate represents the discounted current cost of
environmental liabilities as at the respective period end. An
annual estimate of the quantum of closure costs is necessary in
order to fulfil the requirements of the DMR, as well as meeting
specific closure objectives outlined in the mine's Environmental
Management Programme.
Although the ultimate amount of the asset retirement obligation
is uncertain, the fair value of the obligation is based on
information that is currently available. The estimated undiscounted
liability for the asset retirement obligation at March 31, 2011 is
US$92.828 million (December 31, 2010: US$86.667 million). This
estimate includes costs for the removal of all current mine
infrastructure and the rehabilitation of all disturbed areas to a
condition as described in the mine's Environmental Management
Programme. The asset retirement obligation has been determined
using a discount rate of 8.6% and an inflation rate of 6% over a
period of 12 years.
14. Revolving commodity facility
On October 9, 2009, the Company signed a definitive agreement
with Investec Bank Limited ("Investec") to provide a twelve month
renewable revolving commodity finance facility of up to ZAR400
million (US$54.420 million at an exchange rate of ZAR7.35: US$1.00)
for working capital purposes.
In terms of this facility Investec will finance up to 91% of
PPM's platinum, palladium and gold deliveries to Northam Platinum
Limited. This facility bears interest at the Johannesburg Interbank
Lending Rate ("JIBAR") plus 3.0% and is repaid within 2 to 3 months
upon which the funds are again available for draw-down.
As at As at
Mar 31, Dec 31,
2011 2010
$ 000 $ 000
---------------------------------------- --------- ---------
Balance at the beginning of the period 3,468 5,854
Increase in liability for the period 11,377 -
Repayment of amounts owing (10,084) (2,684)
Interest accrued (297) (48)
---------------------------------------- --------- ---------
4,464 3,122
Effect of exchange rate changes 435 346
---------------------------------------- --------- ---------
Balance at the end of the period 4,899 3,468
---------------------------------------- --------- ---------
15. Current portion of long-term borrowings
As at As at
Mar 31, Dec 31,
2011 2010
$ 000 $ 000
---------------------------------------- --------- -------------
Balance at the beginning of the period 31,923 -
- Pallinghurst short-term facility - 26,603
Interest on borrowings 365 1,620
Settlement of borrowings (28,822) -
---------------------------------------- --------- -------------
3,466 28,223
Effect of exchange rate changes (3,466) 3,700
---------------------------------------- --------- -------------
Balance at the end of the period - 31,923
---------------------------------------- --------- -------------
A bridge loan facility for PPM of US$35.000 million (ZAR350.000
million) was concluded with Standard Bank in May 2008. The term of
the bridge loan facility was initially to August 31, 2008 but
subsequently extended and repaid in full on August 31, 2009 in the
amount of ZAR404.354 million, including interest accrued (US$51.987
million).
In connection with this facility, the Company issued 300,000
warrants exercisable at US$6.95 per common share from September 15,
2008 until expiry of the warrants on May 14, 2011. The fair value
of the warrants of US$0.846 has been treated as a cost of the
transaction and fully amortized during the year ended February 28,
2009.
The Company has classified this facility as held to maturity and
the fair value of the warrants of US$846,238 has been treated as a
cost of the loan transaction and has been amortized to net income
using the effective interest method over the facility term.
On March 22, 2010, a subsidiary of Platmin entered into a
ZAR191.000 million short term lending facility (the equivalent of
US$26.000 million at an exchange rate of ZAR7.38 to the US dollar)
with Pallinghurst Resources Limited ("Pallinghurst"). As at
December 31, 2010, a total of ZAR191.000 million had been drawn
against this facility. This facility was initially for a period of
3 months but has been extended until February 28, 2011 and was
repaid in full on February 28, 2011.
16. Convertible debenture
Option
component
accounted
for in Liability
equity component
$ 000 $ 000
---------------------------------------- ------------- ----------------
Convertible debenture issued 26,664 132,044
Fair value adjustment at extension
date 1,238 (1,060)
Interest for the period - 3,241
Transaction costs - (1,128)
Effect of exchange rate changes - 131
---------------------------------------- ------------- ----------------
Balance as at Dec 31, 2010 27,902 133,228
Fair value adjustment at extension
date 7,908 -
Fair value adjustment at modification
date 6,556 -
Interest for the period - 976
---------------------------------------- ------------- ----------------
42,366 134,204
Effect of exchange rate changes - 796
Conversion of debenture - (135,000)
---------------------------------------- ------------- ----------------
Balance as at Mar 31, 2011 42,366 -
======================================== ============= ================
On May 13, 2010, the Company issued US$135.000 million of zero
percent convertible debentures, initially subject to conversion by
December 31, 2010 at a price of US$1.215 that would have resulted
in 111,111,111 shares being issued. The maturity date of the
convertible debentures was extended from December 31, 2010 to
February 28, 2011 and subsequently to March 31, 2011, and the
conversion price reduced from US$1.215 to US$0.84.
On March 31, 2011, all the conditions precedent for the
conversion of the convertible debentures had been fulfilled and
conversion took place at US$0.84 per share. A total of 160,714,286
new shares were issued.
17. Cost of operations
Included in cost of operations:
For the three months ended
Mar 31, Mar 31,
2011 2010
$ 000 $ 000
--------------------------------------- ------------- -------------
On mine operations
Materials and mining costs 29,776 -
Concentrator plant operations
Materials and other costs 9,430 -
Utilities 2,329 -
Beneficiation
Smelting and refining costs 1,880 -
Transport 75 -
Salaries 1,219 -
Sub-total 44,709 -
Depreciation of operating assets (note
6) 6,039 -
Change in inventories (454) -
50,294 -
--------------------------------------- ------------- -------------
18. Administrative and general expenses
For the three months ended
Mar 31, Mar 31,
2011 2010
$ 000 $ 000
---------------------------------------------- -------------- ------------
Included in administrative and general
expenses are the following:
Employee expenses (1,166) (2,103)
Mining operations (950) -
Consulting and professional fees (245) (172)
Royalty tax (153) -
Audit fees (146) (180)
General and administration expenses (315) (1,290)
---------------------------------------------- -------------- ------------
Sub-total (2,975) (3,745)
Share based payments expense 88 (512)
Amortization and depreciation (440) (136)
----------------------------------------------
(3,327) (4,393)
============================================== ============== ============
Included in other expenses are the following:
Other income 54 -
Share-based payment expense (fair value
adjustment) (14,618) -
Foreign exchange gain / (loss) 7,812 (9)
----------------------------------------------
(6,752) (9)
---------------------------------------------- -------------- ------------
19. Loss per share attributable to owners of the parent
For the three
months ended
Mar Mar
31, 31,
2011 2010
--------------------------------------------- ----------- -----------
Basic loss per share (US$)
Basic loss per share is calculated by
dividing the net loss for the period/
year attributable to owners of the parent
by the weighted average number of ordinary
shares outstanding during the period/
year (0.04) (0.01)
Reconciliations:
Net loss used in calculating basic earnings
per share attributable to owners of the
parent (US$'000) (27,802) (3,597)
============================================= =========== ===========
Weighted average number of shares used
in the calculation of basic earnings
per share ('000) 749,681 445,018
--------------------------------------------- ----------- -----------
There are no reconciling items between loss and headline loss
and therefore the loss per share and headline loss per share are
the same.
Due to the Group reporting a loss for the period ending March
31, 2011 the diluted loss per share is equal to the basic loss per
share.
20. Events after the reporting period
On April 20, 2011, the Company transferred the purchase
consideration of US$82.000 million for the incremental 5.99 million
4E PGM inferred resource ounces contained within Sedibelo West to
an Escrow account. Upon approval by the DMR of the Section 102 or
Section 11(a) application in terms of the Mineral and Petroleum
Resources Development Act to incorporate this area as part of the
Tuschenkomst Mining Rsight, these funds will be released to the
vendors.
For further information:
Charmane Russell Russell & Associates +27 11 880 3924
+27 82 372 5816
Charles Batten
Investec Bank plc (Nominated Advisor)
+44 20 7 597 4000
This information is provided by RNS
The company news service from the London Stock Exchange
END
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