Lonmin Plc, one of the world’s largest primary platinum producers, today, 17 July 2017, announces its production results for the quarter ended 30 June 2017 and a business update.
The company reports two fatalities in a period when the 12 month rolling Safety Lost Time Injury Frequency Rate (“LTIFR”) had in fact improved by 2.0% quarter on quarter.
The mining performance improvement since March 2017 has been sustained into Q3 2017. Total tonnes mined increased by 3.8% to 2.7 million tonnes compared with Q3 2016, up 13.2% on Q2 2017.
Tonnes mined from our Generation 2 shafts, which generate 84% of our production, increased by 9.0% to 2.2 million tonnes compared with the prior year period and increased by 18.6% against Q2 2017.
Concentrator recoveries continue to be excellent at 86.8%.
“We had a pleasing operational performance all round and continue with our decisive work and aim to be at least cash neutral even at current low PGM prices and a strong Rand. I am pleased that with the right team in place, our mining turnaround has been sustained. I am grateful to our employees who have worked hard to produce the results we are seeing. We continue to find levers to pull, in this lower prices for longer environment and to make the improvement of our performance a priority. I am particularly pleased that our net cash has improved. Despite the difficult global macro-economics and the complex and challenging socio political operating environment, we are still able to find common ground for Lonmin to deliver this sustained improved performance,” says Ben Magara, Lonmin Chief Executive Officer.
Sales of 180 348 Platinum ounces increased by 10.8% on prior year period. We are maintaining our full-year sales guidance of 650,000 ounces to 680 000 ounces.
Average Rand full basket price down 3.0% on the prior year period, at ZAR11 506 per PGM ounce.
As a result of the much improved mining performance, unit costs reduced by 4.7% quarter-on-quarter to ZAR11 278 per PGM ounce (6E basis), and increased 6.4% year-on-year, slightly above inflation.
We were at the lower end of the revised unit cost guidance of between ZAR11 300 and ZAR11 800 per PGM ounce.
Gross cash improved to $236 million at 30 June 2017 from $225 million as at the end of the second quarter.
Net Cash improved to $86 million (gross cash of $236 million less the drawn term loan of $150 million) at 30 June 2017, up from $75 million, gross cash of $225 million less the drawn term loan of $150 million at the end of the second quarter.