Mimosa production up 9 pc, Revenues fall 26 pc

AQUARIUS Platinum, which has a 50 percent interest in Zvishavane-based Mimosa Platinum Mine, reported today that platinum production at the local unit rose 9 percent to 118 614 ounces in the first six months to December 31, 2014.ap08102102959

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The mine’s second quarter production at 60 000 ounces was the highest ever quarterly production at the mine.

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Revenues, however, slumped 26 percent to US$146 million on lower metal prices on the international market.

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Mimosa’s parent, Aquarius, realised an accounting loss of US$57 million in the review period, widening from a US$24 million loss in the same period a year earlier following a one off non-cash charges arising in joint venture entities.

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For example, the Johannesburg Stock Exchange-listed miner discounted US$28,5 million owed by the RBZ after realising that a “settlement of the RBZ debt via an indigenisation transaction or the creation of treasury bills as contemplated by the Government of Zimbabwe is now unlikely to occur within twelve months of the balance sheet date, despite the progress initiatives underway”.

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There was also an impairment of the carrying value of Blue Ridge/Sheba’s Ridge

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investment of $26 million following termination of the agreement to sell the Company’s indirect interests in Blue Ridge Platinum (Pty) Ltd and Sheba’s Ridge Platinum (Pty) Ltd.

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Fears over Zimbabwe’s tax regime

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Amplats is concerned that a cocktail of tax measures from the Zimbabwean authorities might put a dent on the company’s future prospects.

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Platinum producers are presently contesting the imposition of a 15 percent tax on unprocessed platinum exports.

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Government, which is angling for the local beneficiation of local resources, is trying to push the three miners – Zimplats, Mimosa and Unki – to establish a local refinery.

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Similarly, Government has also proposed to render royalties payable by Mimosa non

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-deductible for income tax purposes effective January 1, 2015, setting the miner back by US$2,6 million for the half year to December 14.

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It is also believed that an additional 3 percent Aids Levy on mining companies will effectively increase the corporate tax rate to 25,75 percent from the current 25 percent.

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