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(NEWZIMBABWE) Zimplats profits down 68 percent on weak prices

Zimplats profits down 68 percent on weak prices
09/02/2012 00:00:00
by Reuters

PLATINUM miner Zimplats reported a 68 percent drop in quarterly profit on Thursday, hit by the continuing decline in platinum prices. Southern Africa's platinum miners have been squeezed by the drop in the price of the metal after the 2008 financial crisis. Unlike gold, platinum - which is used in automobile exhausts - is normally not seen as a safe-haven asset.

The company, which is 87 percent owned by Implats, said October-December operating profit totalled $19.22 million versus $60.96 million previously. During the quarter average platinum prices were 13 percent lower. Revenue was $97 million, a 27 percent decrease.

All three of the firm's underground mines operated at full capacity during the quarter and production of platinum group metals in concentrate was up 2 percent at 97,174 ounces, compared to 94,952 ounces previously.

The miner said royalties for the period dating back to January 2010 had been accrued at a higher rate than provided for in its initial investment agreement with the Zimbabwe government, triggering a legal dispute which is now before the courts.

Last month, state media reported the Zimbabwe Revenue Authority issued Zimplats' bankers with a garnishee order - an order that instructs the bank to pay out of Zimplats' funds - for $28.3 million in outstanding royalty payments, a figure the miner disputes.

Labels: PLATINUM, ZIMPLATS

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