27 Mar Trading Statement
AIM: JLP 27 March 2012
Registration number: 4459850
JUBILEE PLATINUM PLC
(“Jubilee” or the “Company”)
In terms of the Listings Requirements of the JSE Limited, a listed company is required to publish a trading statement as soon as it becomes aware that the financial results for the next period to be reported on will show a 20% or more difference from those of the previous corresponding period.
Jubilee is expecting an increase in loss per share and headline loss per share of between 55% and 75% for the interim period ended 31 December 2011 compared to that of the previous comparative period.
Shareholders are referred to the following extract from the interim results for the six months ended 31 December 2011, which extract has been included to explain the above increase in loss per share and headline loss per share:
HIGHLIGHTS IN THE PERIOD UNDER REVIEW
- Company produced its initial platinum containing alloy for export, in March 2012 and will continue to increase the production of this material.
- The new 5MVA furnace commissioned at Middelburg became operational in November 2011 with the Middelburg operation reaching a record production of 774 tonnes of ferroalloy in January 2012 and 818 tonnes in March 2012. Ramping up of the operation continues in order to reach targeted full production of 1200 tonnes of alloy per month.
- The Middelburg site continues to increase revenues and generating cash flow in line with the ramp-up of the operation since November 2011.
- Company focussed on advancing current and several new opportunities for ConRoast including potential rights to chromite tailings, existing joint ventures, securing prospecting and mining rights for its PGM-bearing chromite deposits in the western Bushveld.
- Tjate/Jubilee received a cash offer of ZAR75 million for Quartzhill farm portion of the Tjate platinum deposit
- Quartzhill is considered not being core to Tjate’s long term mining plan.
- A Mining Right Application has been submitted for the Tjate Platinum project.
- Jubilee concluded a drilling program for new samples on the Leinster nickel sulphide tailings for testwork at Mintek South Africa.
- The Company raised GBP4.422 million through a placing of 31 585 714 new Jubilee oridnary shares with major insitutional investors at a price of 14 pence (ZAR1.72).
The Company operated in a challenging six months period ending 31 December 2011 making significant positive progress in the implementation of its Mine-to-Metal business strategy.
In the period under review:
The Company on behalf of its subsidiary Tjate Platinum Corporation (Pty) Ltd (“Tjate Platinum”) received a ZAR75M cash offer from a major mining company for the Quartzhill farm, a portion of the Tjate Platinum’s Project. This offer represents a premium of nearly double the pro-rated original purchase price for the farm, which is not core to Tjate Platinum’s long term mining plan for the project. This offer, which Jubilee is recommending to Tjate Platinum shareholders, is subject, inter alia, to the approval of 80% of Tjate Platinum shareholders, regulatory approvals and due diligence by the offeror. The offer is a vindication of Jubilee’s acquisition of a substantial interest in what is arguably the largest undeveloped block of platinum in the eastern Bushveld.
The Company awaits the Department of Mineral Resources’s (“DMR”) acceptance of Tjate Platinum’s application for a mining right.
Applications for other Jubilee projects being considered by the DMR include mining right applications by the Company’s subsidiary Maude Mining and Exploration for platinum to portions on Elandsdrift and Bokfontein farms; and a prospecting right for platinum and chromite in a separate venture for farms comprising more than 64 other portions of the Bokfontein farm.
The Company’s new ferroalloy smelting furnace (5MVA AC) in Middelburg became operational in November 2011 with the Middelburg operation reaching in January 2012(post interims) a record 774 tonnes of ferroalloy production and a new high in March 2012 of 818 tonnes of ferroalloy. This steady progress in production ramp up of the new furnace reflects the successful use of improved refractory materials for the furnace shell lining and tap blocks resulting in materially less corrosion of the linings and in turn less furnace downtime. The increase in production has resulted in a strong increase in revenues generated by the operation (from November 2011 and post interims). The management continues to ramp up production towards its targeted design output of 1200 tonnes ferroalloy per month.
The Company continued its dialogue with Northam Platinum under its Memorandum of Understanding to establish a joint venture to evaluate the construction of a dedicated 5MW DC arc furnace facility using ConRoast technology specifically to smelt concentrate produced from Northam’s developing Booysendal mine in the eastern Bushveld.
The Department of Economic Development, Environment and Tourism issued the Company’s subsidiary Jubilee Smelting and Refining (Pty) Ltd. (“JSR”) in Middelburg with an Atmospheric Emission Licence in respect of its current and submitted new planned operations. JSR’s smelter operation is now fully permitted for the implementation of the ConRoast process and associated refining of the PGM containing alloy. This, together with maximising cash flow from the ferroalloy smelting process, significantly advances JSR’s medium term mission for the implementation of the complete ConRoast platinum smelting process and further strengthens its position in negotiations in sourcing PGM-rich chromite tailings.
The Company has continued to assess and enter into dialogue with owners of near-term PGM-rich chromite mining and tailings retreatment opportunities. Jubilee is in a unique position to avail itself of these opportunities due to its ability to process platinum concentrates containing high chrome values. The Company has submitted a bid for the processing of a platinum-bearing chromite tailings opportunity and expects the outcome of the bid to be announced within Quarter 2 of 2012. Processing of own platinum concentrates significantly enhances the business model for the Company.
In Madagascar, the Company’s 2011 planned drilling programme for the Ambodilafa project has been delayed due to difficulties with the local drilling contractor. The Company continues to review its strategic options for continued exploration in the country.
Jubilee’s Australian subsidiary, Braemore Nickel (Pty) Ltd (“Braemore”) concluded a drilling program on the Leinster nickel sulphide tailings to obtain fresh samples for testwork at Mintek South Africa, in order to refine the scoping flowsheet on the Nickel Tailings Project.
During the period under review, the Company made a loss attributable to shareholders of £3,347,944 compared to a loss of £1,252,442 in the six months ended 31 December 2010. The loss per share for the period under review was 1.24 pence against a loss of 0.76 pence for the interim period ending 31 December 2010. Of this 1.24 pence loss per share, depreciation accounted for 0.27 pence per share.
In October 2011, the Company raised £4.422 million gross through a placing with major institutions of 31,585,714 new ordinary shares of 1 pence each in the Company at 14 p per share representing a 12% premium to the then prevailing market price.
The information in this trading statement has not been reviewed or reported on by Jubilee’s auditors. The interim results announcement is expected to be published on or about 30 March 2012.
Jubilee Platinum plc
Colin Bird/Leon Coetzer/Andrew Sarosi
Tel +44 (0) 20 7584 2155 / Tel +27 (0) 11 465 1913/+44 (0) 1752 221937
Matthew Robinson/Ben Thompson – corporate finance
Joanna Weaving – corporate broking
Tel +44 (0) 20 7220 0500
Shore Capital Stockbrokers Limited (Joint Broker)
Jerry Keen/ Edward Mansfield
Tel: +44 (0) 20 7 408 4090
Leonard Eiser /Sharon Owens
Tel +27 (0) 11 809 7500
Bishopsgate Communications Ltd
Nick Rome/Shabnam Bashir
Tel +44 (0) 20 7562 3350