Eastern Platinum Limited Reports Results for the First Quarter of 2022
Eastern Platinum Limited Reports Results for
the First Quarter of 2022
Vancouver, British Columbia--(Newsfile Corp. - May 13, 2022) - Eastern Platinum Limited (TSX: ELR)
(JSE: EPS) ("
Eastplats
" or the "
Company
") is pleased to report that it has filed its condensed interim
consolidated financial statements for the three months ended March 31, 2022 and the corresponding
management's discussion and analysis. Below is a summary of the Company's financial results for the
first quarter of 2022 ("
Q1 2022
") (all amounts in USD unless specified) in comparison to the same
respective period in 2021 ("
Q1 2021
"):
Revenue for Q1 2022 increased to $17.4 million (Q1 2021 - $16.7 million), representing a 4.3%
increase. The increase in revenue for Q1 2022 was primarily due to an increase in platinum group
metal ("PGM") sales in the period.
Mine operating income increased by $2.0 million (or 137.5%) to $3.4 million in Q1 2022 (Q1 2021
- $1.4 million), resulting in an improved gross margin of 19.6% in Q1 2022 from 8.6% in Q1 2021.
Operating income was $0.1 million in Q1 2022 compared to an operating loss of $1.7 million in Q1
2021.
Net income attributable to shareholders was $3.0 million ($0.02 earnings per share) in Q1 2022
versus loss attributable to shareholders of $0.9 million ($0.01 loss per share) in Q1 2021. The Q1
2022 net income was largely attributable to the foreign exchange gain due to the appreciation of
the South African Rand relative to the U.S. Dollar in Q1 2022, while in Q1 2021, the U.S. Dollar
strengthened.
The Company had positive working capital (current assets less current liabilities) of $17.2 million
as at March 31, 2022 (December 31, 2021 - $14.6 million) and short-term cash resources of $6.6
million (consisting of cash, cash equivalents and short-term investments) (December 31, 2021 -
$6.1 million).
Operations
The Company continues its Retreatment Project at Barplats Mines (Pty) Limited's tailings facility (the
"Retreatment Project") located at the Company's Crocodile River Mine ("CRM") in South Africa.
Summary of chrome production for the three months ended March 31, 2022 and March 31, 2021:
Q1 2022
Q1 2021
Total Tailings Feed (Tons)
574,242
607,606
Average grade Cr concentrate
38.97%
38.47%
Tons of Cr concentrate
121,122
203,901
The majority of the Company's revenue (approximately 84% for Q1 2022) is generated from the offtake
agreement with Union Goal Offshore Solution Limited ("
Union Goal
") in relation to chrome concentrate
production from the Retreatment Project. The remaining amount of the Company's revenue was from
PGM concentrate sales to Impala Platinum Limited ("
Impala
").
The completion of the reconfiguration and optimization of the small-scale PGM circuit ("
PGM Circuit D
")
in Q1 2021 continued to successfully utilize the feed, following the recovery of chrome concentrate, to
produce PGM concentrate under the respective offtake agreements in Q1 2022. Refurbishment work
commenced on the PGM main plant circuit ("
PGM Main Circuit B
") during April 2021 and the circuit
was commissioned in October 2021 (see press release of October 29, 2021 for further information).
PGM Circuit D and PGM Main Circuit B (collectively, the "
PGM Circuits
") are both operating and
continue to drive revenue growth and gross margin improvement for the Company.
Summary of PGM production for the three months ended March 31, 2022 and 2021:
Q1 2022
Q1 2021
Tons of PGM concentrate
879
44
During the period, the Company continued work to close the Maroelabult resource project sale with
Eland Platinum (Pty) Limited. Eastplats announced the completion of the sale (see press release of
March 22, 2022 for further information). Total cash consideration of R20 million (approximately $1.3
million) was received on March 9, 2022 after the transfer of legal title and various regulatory obligations
required in South Africa were completed.
Diana Hu, President, Chief Executive Officer, and Director of Eastplats, commented, "The Q1 financial
results have shown the Company is on the right path to continue its revenue growth and profitability
improvements from the Retreatment Project and capacity increases from the PGM circuits. We are
confident with the progress made by the team and expect to disclose the updated NI 43-101 compliant
independent technical report on the Crocodile River Mine shortly."
Outlook
The Company's targets for 2022 are as follows:
Optimize the operations of the Retreatment Project and maximize returns (ongoing)
Completion of the Optimization Program for the Retreatment Project (ongoing)
Assess the value of the chrome recovery plant after optimization (ongoing)
Operate and optimize the PGM Circuits (ongoing);
Capital raise to restart Zandfontein underground operations at the Crocodile River Mine (initiated);
Completion of the second phase of the tailings storage facility ("
TSF
") capital works program
(ongoing);
Mareesburg project environmental work to complete the legal analysis on the Environmental Impact
Assessment ("
EIA
") and other environmental studies and amendments (ongoing);
Prospecting and assessment work in relation to Zandfontein, Crocette and Spitzkop ore bodies
(ongoing);
EIA and other assessment work regarding a vertical furnace and pelletizer of chrome concentrate
(ongoing); and
Update other capital assessments upon completion of capital fundraising.
Care and maintenance with respect to the underground portion of the CRM will continue while the
Company assesses the Zandfontein underground operations for restart.
The Company has a primary listing on the Toronto Stock Exchange and a secondary listing on the JSE
Limited.
The Company has filed the following documents, under the Company's profile on SEDAR at
www.sedar.com
:
Condensed interim consolidated financial statements for the three months ended March 31, 2022;
and
Management's discussion and analysis for the three months ended March 31, 2022.
The condensed interim consolidated financial statements for the three months ended March 31, 2022
are available for download at
https://eastplats.com/investors-2/reports/
and are also available on the
JSE's website at:
https://senspdf.jse.co.za/documents/2022/JSE/ISSE/EPS/Q122.pdf
.
Covid-19
The Government of South Africa lifted the National State of Disaster in response to the COVID-19
pandemic on April 5, 2022. The Company continues to follow the health guidelines of the Government of
South Africa. The chrome and PGM production and delivery remains in full operation. The effects of
COVID-19 are uncertain and the consequences of a further temporary shutdown of any operations or
other related issues cannot be reasonably estimated at this time, but could potentially have material
adverse effects on the Company's business, operations, liquidity and cashflows.
About Eastern Platinum Limited
Eastplats owns directly and indirectly a number of PGM and chrome assets in the Republic of South
Africa. All of the Company's properties are situated on the western and eastern limbs of the Bushveld
Complex, the geological environment that hosts approximately 80% of the world's PGM-bearing ore.
Operations at the Crocodile River Mine currently include re-mining and processing its tailings resource
to produce PGM and chrome concentrates from the Barplats Zandfontein tailings dam.
For further information, please contact:
EASTERN PLATINUM LIMITED
Wylie Hui, Chief Financial Officer and Corporate Secretary
(email)
(604) 800-8200 (phone)
Cautionary Statement Regarding Forward-Looking Information
This press release contains "forward-looking statements" or "forward-looking information" (collectively
referred to herein as "
forward-looking statements
") within the meaning of applicable securities
legislation.
Such forward-looking statements include, without limitation, forecasts, estimates,
expectations and objectives for future operations that are subject to a number of assumptions, risks and
uncertainties, many of which are beyond the control of the Company.
Forward-looking statements are
statements that are not historical facts and are generally, but not always, identified by the words "will",
"plan", "intends", "may", "could", "expects", "anticipates" and similar expressions. Further disclosure of
the risks and uncertainties facing the Company and other forward-looking statements are discussed in
the Company's most recent Annual Information Form available under the Company's profile on
www.sedar.com
.
In particular, this press release contains, without limitation, forward-looking statements pertaining to:
profitability; revenue growth and gross margin improvements derived from the PGM Circuits; completion
of the updated NI 43-101 compliant independent technical report on the CRM; the Company's targets for
2022 including optimization of the Retreatment Project operations; completion of the Optimization
Program for the Retreatment Project, assessment of the value of the chrome recovery plant; operations
and optimization of the PGM Circuits; capital raise to restart Zandfontein underground operations at the
Crocodile River mine; completion of
the second phase of the TSF capital works program; Mareesburg
project environmental work to complete the legal analysis on the EIA and other environmental studies
and amendments; prospecting and assessment work in relation to Zandfontein, Crocette and Spitzkop
ore bodies; EIA and assessment work regarding a vertical furnace and pelletizer of chrome concentrate;
the update of other capital assessments upon completion of capital fundraising; care and maintenance
with respect to the underground portion of the CRM; and the potential effects of COVID-19 and any future
measures taken by the Government of South Africa and their impact on the Company and its business,
operations, liquidity and cashflows. These forward-looking statements are based on assumptions made
by and information currently available to the Company.
Although management considers these
assumptions to be reasonable based on information currently available to it, they may prove to be
incorrect.
By their very nature, forward-looking statements involve inherent risks and uncertainties and
readers are cautioned not to place undue reliance on these statements as a number of factors could
cause actual results to differ materially from the beliefs, plans, objectives, expectations, estimates and
intentions expressed in such forward-looking statements. These factors include, but are not limited to,
unanticipated problems that may arise in the Company's production processes, commodity prices, lower
than expected grades and quantities of resources, need for additional funding and availability of such
additional funding on acceptable terms, economic conditions, currency fluctuations, competition and
regulations, legal proceedings and risks related to operations in foreign countries.
All forward-looking statements in this press release are expressly qualified in their entirety by this
cautionary statement, the "
Cautionary Statement on Forward-Looking Information
" section contained in
the Company's most recent Management's Discussion and Analysis available under the Company's
profile on
www.sedar.com
.
The forward-looking statements in this press release are made as of the date
they are given and, except as required by applicable securities laws, the Company disclaims any
intention or obligation, and does not undertake, to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
No stock exchange, securities commission or other regulatory authority has approved or
disapproved the information contained herein.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/123905