Implats - Consolidated audited annual results for the year ended 30 June 2005
Impala Platinum Holdings Limited
(Incorporated in the Republic of South Africa)
Registration No. 1957/001979/06
Share code: IMP/IMPO
ISIN: ZAE000003554
LSE: IPLA
ADR`s IMPUY
(`Implats` or `the company`)
Consolidated annual results for the year ended 30 June 2005 (Audited)
* Best ever group safety performance
* Headline platinum production up 5% to 1.815 million ounces
* Record production at Impala Platinum - 1.115 million ounces
* Sales revenue rose by 6% to R12.54 billion ($2.02 billion)
* Net profit of R5.2 billion up 78%
* Headline earnings per share up by 10%
* Final dividend R18.00 ($2.70) per share
Balance Sheet
As at As at
(All amounts in Rand millions 30 June 30 June
unless otherwise stated) 2005 2004
ASSETS
Non-current assets
Property, plant and equipment 10,035.0 9,635.6
Investments in associates 901.2 2,304.6
Deferred income tax assets - 9.4
Available-for-sale financial investments 276.4 186.4
Held-to-maturity-investments 99.3 89.0
Other receivables 609.2 132.7
11,921.1 12,357.7
Current assets
Inventories 1,721.1 1,229.8
Trade and other receivables 3,189.9 2,246.2
Cash and cash equivalents 3,984.3 1,204.2
8,895.3 4,680.2
Total assets 20,816.4 17,037.9
EQUITY
Capital and reserves attributable to the
equity holders of the holding company
Share capital 120.4 657.9
Other reserves (506.1) (626.3)
Retained earnings 14,496.0 10,653.2
14,110.3 10,684.8
Minority interest 159.8 128.1
Total equity 14,270.1 10,812.9
LIABILITIES
Non-current liabilities
Deferred income tax liabilities 2,381.1 2,271.9
Provision for employee benefit obligations 64.6 62.3
Provision for future rehabilitation 234.9 207.3
2,680.6 2,541.5
Current liabilities
Trade and other payables 3,582.4 2,875.1
Current income tax liabilities 280.0 239.8
Borrowings 3.3 568.6
3,865.7 3,683.5
Total liabilities 6,546.3 6,225.0
Total equity and liabilities 20,816.4 17,037.9
Income Statement
Year ended Year ended
(All amounts in Rand millions 30 June Change 30 June
unless otherwise stated) 2005 % 2004
Sales 12,540.8 6.2 11,809.1
On-mine operations (4,109.5) (3,667.7)
Concentrating and smelting (1,043.3) (967.4)
operations
Refining operations (502.1) (477.2)
Amortisation of mining assets (628.8) (572.3)
Metals purchased (2,488.9) (2,259.2)
Increase in metal inventories 454.8 394.4
Cost of sales (8,317.8) (10.2) (7,549.4)
Gross profit 4,223.0 (0,9) 4,259.7
Net foreign exchange transaction 32.5 (216.0)
gains/(losses)
Other operating expenses (318.9) (255.4)
Other income 292.2 11.4
Other gains - net 249.8 138.6
Finance costs (54.3) (74.6)
Share of profit of associates 203.7 328.4
Royalty expense (414.9) (414.4)
Profit from sale of Lonplats 3,155.0 322.3
(2004: Barplats Investments Ltd)
Impairment of mining assets (1,033.8) -
Profit before tax 6,334.3 54.5 4,100.0
Income tax expense (1,080.4) (1,141.3)
Profit for the year 5,253.9 77.6 2,958.7
Profit attributable to:
Equity holders of the company 5,237.6 2,941.3
Minority interest 16.3 17.4
5,253.9 2,958.7
Earnings per share (expressed in
cents per share)
- basic 7,920 79.3 4,418
- diluted 7,914 79.5 4,410
Headline earnings per share
(expressed in cents per share)
- basic 4,325 9.9 3,934
- diluted 4,322 10.1 3,927
Dividends to group shareholders
- final dividend June 2005/4 1,800 12.5 1,600
proposed (cents per share)
- interim dividend December 500 - 500
2004/3 paid (cents per share)
2,300 9.5 2,100
Summary of Business Segments
(All amounts in Rand millions, unless otherwise stated)
Year ended Barplats
30 June Impala Marula disposed Zimbabwe
2005 segment segment segment segment
for the year ended 30 June
2005
Total sales 12,040.6 237.0 1,000.9
Gross profit 3,532.8 (123.4) 229.5
for the year ended 30 June
2004
Total sales 11,098.7 94.4 112.9 935.9
Gross profit 3,181.6 (16.9) (4.9) 372.2
Year ended Refining Inter-
30 June services segment
2005 segment adjustment Total
for the year ended 30 June 2005
Total sales 4,072.3 (4,810.0) 12,540.8
Gross profit 611.8 (27.7) 4,223.0
for the year ended 30 June 2004
Total sales 3,851.5 (4,284.3) 11,809.1
Gross profit 716.0 11.7 4,259.7
Statement of Changes in Shareholders` Equity
Attributable to equity
holders of the Company
(All amounts in Share Other Retained Minority Total
Rand millions
unless otherwise
stated)
capital reserves earnings interest equity
Balance at 30 June 617.8 38.8 9,220.8 418.9 10,296.3
2003
Impact of adopting 10.9 (10.9) -
IFRS2 (Share-based
payments) on
opening retained
earnings
Restated balance 628.7 38.8 9,209.9 418.9 10,296.3
at 30 June 2003
Fair value losses,
net of tax:
Available-for-sale (48.6) (48.6)
financial assets
Currency (265.8) (33.4) (299.2)
translation
differences, net
of tax:
Net expense (314.4) (33.4) (347.8)
recognised
directly in equity
Profit for the 2,941.3 17.4 2,958.7
year
Total recognised (314.4) 2,941.3 (16.0) 2,610.9
income for 2004
Employee share
option scheme:
Adjustment as a (18.7) (18.7)
result of
consolidating
share trust
Proceeds from 26.2 26.2
shares issued
Fair value of 21.7 21.7
employee service
Issue of shares by 17.8 17.8
subsidiary
Dividend relating (1,165.4) (1,165.4)
to 2003
Dividend relating (332.6) (332.6)
to 2004
Disposal of (11.4) (11.4)
Barplats
Investments
Limited
Business
combinations:
Purchase of (350.7) (281.2) (631.9)
additional share
in Zimplats
Holdings Limited
(formerly Zimbabwe
Platinum Mines
Ltd)
29.2 (350.7) (1,498.0) (274.8) (2,094.3)
Balance at 30 June 657.9 (626.3) 10,653.2 128.1 10,812.9
2004
Fair value
profits, net of
tax:
Available-for-sale 76.6 76.6
financial assets
Currency 72.6 8.6 81.2
translation
differences, net
of tax:
Net income 149.2 8.6 157.8
recognised
directly in equity
Profit for the 5,237.6 16.3 5,253.9
year
Total recognised 149.2 5,237.6 24.9 5,411.7
income for 2005
Employee share
option scheme:
Proceeds from 53.3 53.3
shares issued
Fair value of 22.3 22.3
employee service
Purchase of (613.1) (613.1)
treasury shares by
subsidiary
Dividend relating (1,062.6) (1,062.6)
to 2004
Dividend relating (332.2) (332.2)
to 2005
Business
combinations:
Purchase of (29.0) 6.8 (22.2)
additional share
in Zimplats
Holdings Limited
(formerly Zimbabwe
Platinum Mines
Ltd)
(537.5) (29.0) (1,394.8) 6.8 (1,954.5)
Balance at 30 June 120.4 (506.1) 14,496.0 159.8 14,270.1
2005
Cash Flow Statement
Year ended Year ended
(All amounts in Rand millions 30 June 30 June
unless otherwise stated) 2005 2004
Cash flows from operating activities
Cash generated from operations 3,755.5 3,147.6
Interest paid (37.4) (63.0)
Income tax paid (931.1) (1,264.5)
Net cash from operating activities 2,787.0 1,820.1
Cash flows from investing activities
Acquisition of subsidiary, net of cash (22.2) (631.9)
acquired
Disposal of subsidiaries, net of cash - 388.6
sold
Purchase of property, plant and equipment (1,995.5) (1,824.7)
Proceeds from sale of property, plant and 31.9 7.8
equipment
Increase in investments in associates (82.3) (42.0)
Repayment of shareholders loan in 22.1 -
associate
Disposal of investment in associate 4,919.8 -
Purchase of unlisted investments - (14.7)
Loans granted (617.5) -
Loan repayments received 41.7 -
Payments made to environmental trust - (8.3)
Interest received 200.1 78.2
Dividends received 1.0 295.8
Net cash generated from/(used in) 2,499.1 (1,751.2)
investing activities
Cash flows from financing activities
Issue of ordinary shares 53.3 25.2
Purchase of treasury shares by subsidiary (613.1) -
(Repayments of)/proceeds from short-term (548.1) 380.9
borrowings
Repayments of long-term borrowings - (74.7)
Dividends paid to company`s shareholders (1,394.8) (1,498.0)
Net cash used in financing activities (2,502.7) (1,166.6)
Net increase/(decrease) in cash and cash 2,783.4 (1,097.7)
equivalents
Cash and cash equivalents at beginning of 1,187.0 2,324.5
year
Effects of exchange rate changes on 13.9 (39.8)
monetary assets
Cash and cash equivalents at end of year 3,984.3 1,187.0
Notes
The consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS), South African Statements of
Generally Accepted Accounting Practice and the South African Companies Act and
are prepared under the historical cost convention, as modified by the
revaluation of available-for-sale financial investments, and financial assets
and financial liabilities (including derivative instruments) at fair value
through the income statement or the statement of changes in equity. The
principal accounting policies used by the group are consistent with those of the
previous year, unless otherwise stated.
Changes in accounting policies
Early adoption of standards:
During the financial year the group early adopted the following IFRS`s and the
interpretation of standards (IFRIC), which are relevant to its operations. The
2004 accounts have been amended in accordance with the relevant requirements:
IFRS 2 (issued 2004) Share-based payments.
IFRS 6 (issued 2004) Exploration for and evaluation of mineral
resources.
IFRIC 1 (issued 2004) Changes in existing decommissioning,
restoration and similar liabilities.
IFRIC 4 (issued 2005) Determining whether an arrangement
includes a lease.
IFRIC 5 (issued 2005) Rights to interest arising from
decommissioning, restoration and
environmental rehabilitation funds.
All changes in the accounting policies have been made in accordance with the
transition provisions in the respective standards and interpretations.
The adoption of IFRS 6, IFRIC 4 and IFRIC 5 did not result in any changes to the
groups` reported results.
The early adoption of IFRS 2 has resulted in a change in accounting policy for
share-based payments. Until June 2004, the issue of share options to employees,
did not result in a charge to the income statement. Subsequent to that date, the
group charges the accrued cost of share options outstanding and issued since 7
November 2002 to the income statement.
The early adoption of IFRS 2 has resulted in:
2005 2004
Increase in share capital (R million) 22.3 21.7
Decrease in opening retained earnings (R million) 32.6 10.9
Decrease in headline earnings per share (cents per 41 32
share)
The early adoption of IFRIC 1 has resulted in a change in accounting policy for
the provision for rehabilitation and restoration costs.
The adoption of this interpretation is applied prospectively as the adjustments
to the restoration liability and relevant asset is considered immaterial.
The financial statements have been audited by PricewaterhouseCoopers Inc whose
unqualified opinion is available for inspection at the registered office of
Implats.
The calculation of Headline Earnings per share is derived from profit of
R5,237.6 million (2004: R2,941.3 million) adjusted for any non-operational gains
and losses, divided by the weighted average number of shares in issue.
Adjustments to profit were made for the impairment of assets net of tax R849.8
million, sale of a toll refining contract net of tax (R72.1 million) and profit
on sale of Lonplats (R3,155.0 million). (2004: profit on sale of Barplats
Investments Limited (R322.3 million).
During the year under review, the group acquired a further 1.3 million (2004:
32.3 million) shares in Zimplats Holdings Limited for an amount of R22.2 million
(2004: R631.9 million) (AU$ 4.8 million (2004: AU $135.2 million)).
A restructuring of the shareholding in the Zimplats group, resulted in 14.8
million shares being issued to the holding company for its holding in Zimbabwe
Platinum Mines (Pvt) Limited (formerly Makwiro Platinum Mines (Pvt) Limited).
The total value of this transaction was R244.9 million. The percentage holding
after these changes amounts to 86.9% in Zimplats.
Capital expenditure approved at 30 June 2005 amounted to R9,473.4 million (2004:
R2,447.6 million) of which R2,595.5 million (2004: R603.2 million) is already
contracted. This expenditure will be funded internally and if necessary, from
borrowings.
Certain guarantees were in place as at 30 June 2005:
- Impala Platinum Holdings Limited has provided a guarantee to Investec Bank
Limited on behalf of Aquarius Platinum (South Africa) (Proprietary) Limited
for a loan facility granted of R146.3 million (2004: R175.0 million), of
which nil (2004: R175.0 million) has been utilised at year end. This
guarantee is set to expire upon conclusion of certain project completion
tests relating to the Marikana project. If the project completion tests are
not met, the guarantee will reduce proportionally in line with the loan
repayments to Investec Bank Limited, which started at the end of calendar
year 2004.
- Guarantees amounting to R288.0 million to the various regional offices of
the Department of Minerals and Energy for rehabilitation and closure costs.
Due to the uncertainties regarding the timing and amounts, potential outflows
cannot be quantified.
Operating Statistics
for the year ended 30 2005 2004 Variance
June %
Gross refined production
Platinum (`000 oz) 1,848 1,961 (5.8)
Palladium (`000 oz) 1,029 1,046 (1.6)
Rhodium (`000 oz) 234 251 (6.8)
Nickel (`000 t) 16.0 16.4 (2.4)
Impala refined
production
Platinum (`000 oz) 1,115 1,090 2.3
Palladium (`000 oz) 515 501 2.8
Rhodium (`000 oz) 130 116 12.1
Nickel (`000 t) 7.9 6.9 14.5
IRS refined production
Platinum (`000 oz) 733 871 (15.8)
Palladium (`000 oz) 514 545 (5.7)
Rhodium (`000 oz) 104 135 (23.0)
Nickel (`000 t) 8.1 9.5 (14.7)
IRS returned metal (Toll
refined)
Platinum (`000 oz) 246 501 (50.9)
Palladium (`000 oz) 160 314 (49.0)
Rhodium (`000 oz) 54 97 (44.3)
Nickel (`000 t) 1.9 1.5 26.7
Group consolidated
statistics
Exchange rate: (R/$)
Closing rate on 30 June 6.66 6.17 7.9
Average rate achieved 6.20 6.88 (9.9)
Revenue per platinum ($/oz) 1,279 1,116 14.6
ounce sold
(R/oz) 7,930 7,678 3.3
Prices achieved
Platinum ($/oz) 840 773 8.7
Palladium ($/oz) 208 223 (6.7)
Rhodium ($/oz) 1,217 548 122.1
Nickel ($/t) 14,592 11,843 23.2
Sales volumes
Platinum (`000 oz) 1,562 1,495 4.5
Palladium (`000 oz) 826 733 12.7
Rhodium (`000 oz) 177 179 (1.1)
Nickel (`000 t) 14.6 15.8 (7.6)
Financial ratios
Gross margin achieved (%) 33.7 36.1 (6.6)
Return on equity* (%) 26.8 26.5 1.1
Return on assets* (%) 24.0 21.2 13.2
Debt to equity (%) 0.0 5.3 100.0
Current ratio 2.3:1 1.3:1 76.9
Operating indicators
Tonnes milled ex mine (`000 t) 19,315 19,065 1.3
Pgm refined production (`000 oz) 3,549 3,725 (4.7)
Capital expenditure (Rm) 1,992 1,822 9.3
($m) 322 265 21.5
Group unit cost per (R/oz) 4,548 4,144 (9.7)
platinum ounce
($/oz) 735 604 (21.7)
Impala business segment
Tonnes milled ex mine (`000 t) 15,778 15,639 0.9
Total cost per tonne (R/t) 300 281 (6.8)
milled
($/t) 49 41 (19.5)
Pgm refined production (`000 oz) 2,062 1,976 4.4
Cost per pgm ounce (R/oz) 2,298 2,227 (3.2)
refined
($/oz) 371 324 (14.5)
Cost per platinum ounce (R/oz) 4,251 4,036 (5.3)
refined
($/oz) 687 588 (16.8)
Net of revenue received (R/oz) 1,872 2,195 14.7
for other metals
($/oz) 302 320 5.6
Capital expenditure (Rm) 1,693 1,197 41.4
($m) 274 174 57.5
Total Impala labour (`000) 26.9 27.5 2.2
complement
m2 per stoping employee (m2/empl) 40.1 39.2 2.3
Based on headline profit
Extract from Chief Executive`s Review
SAFETY
The focus on safety continues to yield positive results, with the best ever
performance having been achieved by the group and at the major operating
subsidiary, Impala Platinum.
In spite of our continued improvements in workplace safety, it is with deep
regret that we must report the death of seven employees in work-related
accidents during the year - four people at Impala`s mining operations, one
person at Zimplats and two people at Marula. On behalf of the Board and
management of the company, we extend our condolences to the families and
colleagues of those who have died.
In terms of performance, the group fatal injury frequency rate improved by 34%
year-on-year and has more than halved over the past four years. The lost-time
injury frequency rate improved by 26% year-on-year and has also more than halved
over the past four years. The fall of ground safety campaign and ground control
districts programme continue to play a significant role in these improvements as
does the continued roll-out of behaviour-based safety systems.
PERFORMANCE
Headline production increased by 5%. The star performer was Impala Platinum,
which achieved record platinum production of 1.115 million ounces. During the
year, gross platinum production decreased by 6% from 1.96 million ounces to 1.85
million ounces. This was expected as the FY2004 figures included the once-off
processing of 232,000 ounces of platinum for Lonmin.
Comparisons between FY2004 and FY2005 reflect the underlying market which
included the continued strength of the rand for most of the year under review:
* sales revenues rose by 6% to R12.541 billion;
* PGM sales volumes were up 6% which went some way towards mitigating the
effects of the 10% decline in the average rand/dollar exchange rate
achieved for the year of R6.20/$. Consequently, while dollar revenue per
platinum ounce sold increased by 15% on the previous year, rand revenues
per platinum ounce increased by only 3.3%;
* cost of sales rose by 10% to R8.318 billion. The gross operating margin was
at 34% for the group as a whole and the gross operating margin for Impala
was maintained at 42% for the year;
* unit costs per refined platinum ounce were well controlled at Impala and
only increased by 5.3% to R4,251. The Zimbabwean operations were negatively
affected by local inflation and a managed exchange rate and thus
contributed disproportionately to the significant increase in group unit
cost of 9.7% to R4,548 per refined platinum ounce;
* capital expenditure for the group rose by 9.3% to R1.992 bilion;
* net profit at the headline level increased by 9% to R2.86 billion.
Including profit on the sale of Lonplats (of R3.2 billion) and the
impairment of Marula (of R850 million net of tax) net profit rose by 78% to
R5.2 billion; and
* the Board has declared a final dividend of R18 per share, resulting in a
total dividend for the year of R23 per share.
CORPORATE ACTIVITY
The year saw the conclusion of the Lonplats transaction. Implats` 27.1% stake in
this company was sold for a consideration of R4.9 billion, resulting in profit
on the sale of R3.2 billion. The proceeds were partially applied to a
shareholder-approved share buy-back scheme in which 1.2 million shares (1.8% of
the outstanding share capital) were purchased on the JSE Limited for R613
million, and partially towards capital expenditure, mainly at Impala.
Implats` shareholding in Zimplats increased to 86.9% with the rationalisation of
the structure of Zimplats and Makwiro and the acquisition of 1% on the open
market.
Subsequent to Aquarius Platinum Limited`s BEE transaction being concluded in
October 2004, Implats acquired an additional stake in Aquarius Platinum (South
Africa) (Pty) Limited for R71.5 million to maintain its stake in this company at
20%.
In June 2005, Implats and African Rainbow Minerals Limited announced that they
would proceed with their joint venture, the 120,000 platinum ounces per annum
Two Rivers project. Implats holds a 45% stake in this project and will process
and refine the metals through Impala Refining Services.
In April 2005, Implats signed an agreement with Dynatec Corporation of Canada
regarding the joint progression of the Ambatovy Nickel Project in Madagascar.
This project has the potential to develop into a significant nickel producer and
Implats` initial investment will fund a detailed technical feasibility study to
be concluded in the first half of FY2006. The parties have agreed to bring in a
third partner, Sumitomo Corporation of Japan, a significant off-taker of the
refined product, who will acquire a 25% interest. As a result Implats and
Dynatec will reduce their shareholding to 37.5% each. The project will be
jointly managed by Impala and Dynatec and will benefit from Dynatecs` expertise
in pressure acid leaching technology complemented by Implats` experience in base
metals refining.
THE MARKET
Market volatility continued during the financial year, despite the fact that the
market was supported by continued fundamental demand. Implats achieved an
average basket price of $1,279 per ounce, an increase of 15% on the previous
year. These prices were tempered in rand terms by the continued strength of the
South African currency which resulted in an increase of only 3.3% to R7,930 per
ounce.
After recording a supply deficit for five consecutive years, the platinum market
moved back into balance in calendar year 2004 and is expected to remain so in
calendar year 2005. Demand was supported by growth in the automotive sector, but
was insufficient to counter the growth in supply from South Africa where a
record 5 million ounces was produced in calendar year 2004.
The average free market palladium price for the year at 15% lower than in
calendar year 2003 was at odds with the underlying fundamentals of the palladium
market, which remains significantly in surplus with extensive stockpiles still
being held by manufacturers, banks and speculators.
Rhodium prices achieved increased by 122% to an average of $1,217 per ounce for
the year. This rise was caused by strong industrial demand, principally from the
automotive and glass industries, and the sharp increase in rhodium lease rates
which forced consumers to purchase rather than lease their requirements.
Nickel prices were firm for most of calendar year 2004 and remained at close to
record levels as demand from the stainless steel industry continued to pressure
supplies from the major producers. Stainless steel production slowed somewhat in
recent months easing the tightness in the nickel market.
OPERATIONAL PERFORMANCE
Impala Platinum turned in a record performance, increasing platinum production
by 2% to 1.115 million ounces despite the industrial action experienced during
the year, which resulted in a loss of production of 44,000 ounces. The
processing and refining operations continued to excel, with concentrator
recoveries in particular rising to a record level of 84.3%.
During the year the focus was on optimising the use of infrastructure and
resources; improving productivity; maintaining costs; rolling out technology;
investment in new shafts; and implementation of Mineral Reserve Management and
SAP operating systems.
At Marula Platinum, a revised mining plan was implemented which has seen the
adoption of an interim hybrid mining method (a combination of mechanised and
conventional mining), with full adoption of conventional mining by FY2008. There
has been a steady improvement in performance following the switch to hybrid
mining and the simultaneous introduction of owner-mining.
The slower-than-expected start-up at Marula and the continued strength of the
rand led to revised financial and operating assumptions and the Board acted
decisively in adopting a R1.0 billion (pre-tax) impairment of the asset. It is
expected that the mine will reach break-even in the second quarter of FY2006.
Production at Zimplats remains on track, with 82,400 ounces of platinum
produced, a decrease of 2%. Total costs increased by 25% and unit costs by 23%
as a result of higher opencast mining costs, inflation and the fixed exchange
rate.
To mitigate the opencast mining cost issue, in June 2005, the Zimplats and
Implats Boards approved capital expenditure of $46 million to extend the
existing underground mine at Ngezi as part of a planned transition from opencast
mining to underground operations. This will also position the company for a
rapid start-up to the expansion should the conditions precedent for further
investment be met. The Board has set such pre-conditions before it will approve
further investment to expand operations. Discussions on these issues with the
Zimbabwean government and the Reserve Bank of Zimbabwe continue.
With production of 60,800 ounces of platinum in the year under review, Mimosa
delivered an outstanding performance. As at Zimplats, costs are under pressure
as a result of the fixed exchange rate. Nonetheless, this operation has
maintained a margin of 30%.
Expansion to 80,000 platinum ounces per annum at Mimosa has been approved with
our joint venture partner Aquarius Platinum, subject to the debt funding of $10
million being sourced and project status being granted by the Reserve Bank of
Zimbabwe.
BLACK ECONOMIC EMPOWERMENT AND TRANSFORMATION
Implats has embraced the principles of transformation as a strategic imperative
to reinforce its position as a leading southern African company making the best
possible use of available resources.
A transformation initiative, Project Phambili, has been launched under the
auspices of a Transformation Advisory Committee to ensure that Implats meets the
goals set by the Mining Charter in terms of employment and training, development
of historically disadvantaged South Africans (HDSAs), hostel conversion and home
ownership, beneficiation, affirmative procurement, as well as the employment and
development of women. Currently, detailed implementation plans are being
developed to address the challenging targets that have been set.
Insofar as ownerships targets of the Mining Charter are concerned, Implats
estimates that it currently has credit for 9% as a result of the Lonplats sale
(made in part to HDSAs) and existing shareholders. Implats is engaged in
discussions to secure a potential BEE partner to ensure that the targets of the
Mining Charter are met.
PROSPECTS
Prospects for PGMs essentially remain unchanged from that of recent years. The
automotive industry is expected to continue to be the major driving force of
demand for platinum in the medium term with both light-duty and heavy-duty
diesel vehicle emission control technologies being platinum-based. Demand will
be supported by that from the jewellery sector and the platinum market is thus
likely to remain in balance.
Implats plans to continue to grow its platinum production to about 2.3 million
ounces by FY2010, mainly from expansions at Zimplats. Platinum production in
FY2006 is expected to rise modestly to about 1.9 million ounces.
Costs at the South African operations are expected to be in line with inflation,
although the above inflation wage settlement reached with labour in the 2005
wage negotiations will have an impact.
In Zimbabwe, our cost performance is largely dependent on the impact of the
exchange rate. The steps we have put in place to move to underground mining at
Zimplats should alleviate current operation-driven cost pressures. These cost
pressures should be ameliorated by the recent devaluation of the Zimbabwean
Dollar against the US dollar.
Given current markets and exchange rates as well as a marginal increase in
production in FY2006, headline earnings are expected to increase modestly by 10-
15%.
Fred Roux Keith Rumble
Chairman Chief Executive
Johannesburg
26 August 2005
Declaration of Final Dividend
A final dividend of 1 800 cents per share has been declared in respect of the
year ended 30 June 2005. The last day to trade (`cum` the dividend) in order to
participate in the dividend will be Friday, 16 September 2005. The share will
commence trading `ex` the dividend from the commencement of business on Monday,
19 September 2005 and the record date will be Friday, 23 September 2005.
The dividend is declared in the currency of the Republic of South Africa.
Payments from the London transfer office will be made in United Kingdom currency
at the rate of exchange ruling on 23 September 2005 or on the first day
thereafter on which a rate of exchange is available.
The dividend will be paid on Monday, 26 September 2005. Share certificates may
not be dematerialised/rematerialised during the period Monday, 19 September 2005
to Friday, 23 September 2005, both dates inclusive.
By order of the board
R Mahadevey
Group Secretary
Johannesburg
26 August 2005
Corporate Information
Registered Office
3rd Floor, Old Trafford 4, Isle of Houghton
Boundary Road, Houghton 2198
(PO Box 61386, Marshalltown 2107)
Transfer Secretaries
South Africa: Computershare Investor Services 2004 (Pty) Limited
70 Marshall Street, Johannesburg 2001
(PO Box 61051, Marshalltown 2107)
United Kingdom: Computershare Investor Services plc
The Pavilons, Bridgewater Road
Bristol, BS13 BAE
Directors:
FJP Roux (Chairman), KC Rumble (Chief Executive Officer), DH Brown, CE Markus,
JM McMahon*, MV Menell, TV Mokgatlha, K Mokhele, NDB Orleyn, LJ Paton, JV
Roberts, LC van Vught. *British
`The 2005 financial year was characterised by excellent operational performance,
particularly at Impala Platinum.` Keith Rumble, Chief Executive Officer
A copy of the annual report is available on the Internet web site:
http://www.implats.co.za
Alternatively please contact the Company Secretary, via e-mail at
alan.snashall@implats.co.za or by post at P.O. Box 61386, Marshalltown 2107,
South Africa. Telephone: (011) 481 3900
Date: 26/08/2005 08:00:35 AM
Produced by the JSE SENS Department
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