Implats - Consolidated audited annual results for26 Aug 2005
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                   
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               
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               
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)                  
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)                  
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                                                      
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                                                      
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                                                                
                   capital  reserves earnings   interest equity                 
Balance at 30 June 617.8    38.8     9,220.8    418.9    10,296.3               
Impact of adopting 10.9              (10.9)              -                      
IFRS2 (Share-based                                                              
payments) on                                                                    
opening retained                                                                
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)                
differences, net                                                                
of tax:                                                                         
Net expense                 (314.4)             (33.4)   (347.8)                
directly in equity                                                              
Profit for the                       2,941.3    17.4     2,958.7                
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                                                                       
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                   
Dividend relating                    (1,165.4)           (1,165.4)              
to 2003                                                                         
Dividend relating                    (332.6)             (332.6)                
to 2004                                                                         
Disposal of                                     (11.4)   (11.4)                 
Purchase of                 (350.7)             (281.2)  (631.9)                
additional share                                                                
in Zimplats                                                                     
Holdings Limited                                                                
(formerly Zimbabwe                                                              
Platinum Mines                                                                  
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               
Fair value                                                                      
profits, net of                                                                 
Available-for-sale          76.6                         76.6                   
financial assets                                                                
Currency                    72.6                8.6      81.2                   
differences, net                                                                
of tax:                                                                         
Net income                  149.2               8.6      157.8                  
directly in equity                                                              
Profit for the                       5,237.6    16.3     5,253.9                
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                                                              
Dividend relating                    (1,062.6)           (1,062.6)              
to 2004                                                                         
Dividend relating                    (332.2)             (332.2)                
to 2005                                                                         
Purchase of                 (29.0)              6.8      (22.2)                 
additional share                                                                
in Zimplats                                                                     
Holdings Limited                                                                
(formerly Zimbabwe                                                              
Platinum Mines                                                                  
                   (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               
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)                  
Disposal of subsidiaries, net of cash      -            388.6                   
Purchase of property, plant and equipment (1,995.5)    (1,824.7)                
Proceeds from sale of property, plant and 31.9         7.8                      
Increase in investments in associates     (82.3)       (42.0)                   
Repayment of shareholders loan in         22.1          -                       
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                    
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)                
Cash and cash equivalents at beginning of 1,187.0      2,324.5                  
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                  
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              
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                 
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     
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   
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                                                                  
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                                                        
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                                                              
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                                                                  
($/oz)      735      604        (21.7)                
Impala business segment                                                         
Tonnes milled ex mine     (`000 t)    15,778   15,639     0.9                   
Total cost per tonne      (R/t)       300      281        (6.8)                 
                          ($/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)                 
                          ($/oz)      371      324        (14.5)                
Cost per platinum ounce   (R/oz)      4,251    4,036      (5.3)                 
($/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                   
m2 per stoping employee   (m2/empl)   40.1     39.2       2.3                   
Based on headline profit                                                        
Extract from Chief Executive`s Review                                           
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.                  
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     
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
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 
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   
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   
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 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-
Fred Roux                Keith Rumble                                           
Chairman                 Chief Executive                                        
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                                                                 
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                                                               
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:                                                             
Alternatively please contact the Company Secretary, via e-mail at       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