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Zimplats urges caution

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Zimbabwe Platinum Mines (Zimplats) says shareholders should exercise caution when dealing with the company’s shares as a result of uncertainties in the country’s operating environment.

The call by mining company comes barely a week after the government rejected the 26% social credits that mining companies wanted included in the mining regulation.

“Shareholders are advised to exercise caution in their share dealings due to the uncertain conditions prevailing in Zimbabwe,” the company said in its quarterly report statement for the period April to June.

“The government gazetted new indigenisation and economic empowerment regulations which compels all non-indigenous mining businesses to submit their plans to the minister by May 9. The operating subsidiary is currently reviewing the regulations.”

Indigenisation, Youth Development and Empowerment minister Saviour Kasukuwere a forthnight ago warned the government will “kick out” mining companies which fail to comply with indigenisation requirements by September this year.

Revenue for the platinum company increased by 12% to $146,8 million from $130,5 million in the last quarter.

Operating cost closed the June quarter at $70 million from $66 million in March due to improved volumes and metal prices.

“Operating costs were 19% above previous quarter in line with higher production and sales volumes.
Significant increases in employment costs were also recorded following the conclusion of the 2011 wage negotiations through an arbitration process,” the company said. Operating profit increase
by 6% to $69,5 million from $65,5 million the previous quarter.

The mining and milling operations performed better than last quarter with ore mined being at 1,138 tonnes and ore milled.

The company contributed $13,3 million in direct and indirect taxes to the fiscus.Meanwhile Zimplats said the issue of Reserve Bank of Zimbabwe remains unresolved and the assumption of the debt by the government has not yet commenced.

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