Zimplats' Money Minting Operations Continue Growing

Author Name
Rugare Mukanganga
Author
Markets 2 months ago

Operational Update

In a trading update for the three months ended September 2021, Zimplats Holdings reported 1% improvements in both ore mined and head grade of 6E elements mined by the Group (platinum, palladium, rhodium, rhuthenium, iridium and gold). However, when compared to the same three-month period of 2020, the 1.8m tonnes mined in the quarter were 3% lower. At 3.45 g/t, 6E head grade was 1% lower than the previous year’s comparable period. The declines from prior year output were the result of lower productivity at the successfully rehabilitated box-cut highwall. The rehab led to a ramp-up of teams resuming production at the Group’s Ngwarati Mine at the beginning of the July this year.

The Group also noted a 5% decline in ore milled from the quarter ended June 2021, the result of a planned shutdown for mill relining at the Selous Metallurgical Complex concentrator. On account of lower volumes milled, the 143,061oz of 6E final products produced in the period were 7% lower than the quarter ended June 2021. Additionally, on account of a concentrates smelted deferral in September 2020 to the December 2020 quarter, volumes in the quarter ended September 2021 were 1% higher.

Financial Updates

In the quarter ended September 2021, the Group’s operating cash expenses were 1% ahead of the previous quarter. The Group attributes the decline to higher Covid-19 expenditure and an increase in insurance costs. In anticipation of a 3rd concentrator commissioning at Ngezi, US$3m was transferred from operating costs to closing stocks during the quarter. Additionally, declines in volumes produced and increased operating costs led to a 4% drop in operating cash costs and 7% to rise on an annual basis.

Outlook

As part of sustainable mining practices, the Group set aside US$0.4m which was spent on exploration projects. Notably, an additional US$1.1m has been committed as of September 30th 2021 towards the exploration of approximately 8.6km of surface diamond drilling in existing Group projects as well as two mining leases.

As one of the biggest firms in Zimbabwe, Zimplats is a subsidiary of South African-based parent company Impala Platinum Holdings and is listed on the Australian Securities Exchange trading as Zimplats Holdings Limited. In the last five years, platinum has led 6E inflows and contributed an average of 31% to Group revenue. However, a notable shift over the last few years has seen palladium and rhodium revenue contributions overtaking those of platinum, partially the results of improved global mineral prices of the two minerals. 


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