31st Jan 2020 12:07
(Alliance News) - Sylvania Platinum Ltd reported a record first-half production performance despite problems such as power and water supply.
Sylvania has dump operations in South Africa, which comprise of seven platinum group metal recovery plants that treat tailings from surrounding mines on the Bushveld complex. It also owns exploration targets on South Africa's Northern Limb.
Production from the dump operations was 19,206 platinum group metal ounces in the second quarter ended December, down 7.7% from the first quarter. However, the second and third quarters are usually lower than the first and fourth due to public holidays in South Africa.
Sylvania has achieved a record interim production figure of 40,003 ounces, it said.
Net revenue for the second quarter was USD27.9 million, down 11% on the first quarter. Earnings before interest, tax, depreciation, and amortisation fell 9% to USD17.4 million.
The positive first-half performance came despite power problems due to loadshedding by South African state-owned power firm Eskom, as well as a lack of water, though Sylvania said "intermittent" rainfall has eased this slightly.
Further, the chrome market, from which it gets tailings, remains depressed, which may impact sources of chrome. However, it can use dump material to keep plants going at full capacity.
"The group, through the continued diligence of our management and operations teams, has once again produced a strong result in spite of challenges relating to water and power which are both outside of our control. Despite downtime and consequential chokes to the processing plants, our teams were able to explore and implement mitigatory measures and produce a solid 19,206 ounces for the quarter," said Chief Executive Terry McConnachie.
"Historically, the second quarter is known to present challenges in terms of a dip in production due to the host mines' shutdown over the festive period, however, due to careful planning and controls, the dump operations were able to perform very well."
Sylvania shares were 8.5% lower on Friday morning at a price of 39.79 pence each.
By George Collard; [email protected]
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