26th Apr 2006 10:18
AQUARIUS PLATINUM LIMITED26 April 2006Third Quarter RESULTS: 31 March 2006Everest takes group production to record highsHighlights * Quarterly cash profit climbs to $26.7 million, resulting in a net profit of $18.6 million * Year to date net profit at $44.6 million * Record quarterly group attributable production: 120,105 PGM ounces, up 27% quarter on quarter * Year to date group attributable production: 318,531 PGM ounces * Average PGM basket prices rise 9% at South African and 13% at Zimbabwean operations Kroondal (P&SA1) * 107,501 PGM ounces produced for the quarter (Aquarius attributable 53,751 PGM ounces) * Decline sinking at No. 5 Shaft on Townlands commenced * Cash margin increases 5% quarter on quarter to 61% Marikana (P&SA2) * Open pit production hampered by the pattern and intensity of rainfall. Primary opencast contractor MCC performed well despite adverse weather * Production build-up schedule on P&SA2 plan * Trial underground mining infrastructure underway * Production 5,810 PGM oz (Aquarius attributable 2,905 PGM ounces): cash margin 4% for the quarter Everest * Strong ramp-up continues with production increasing to 46,081 PGM ounces * Opencast mining continues ahead of schedule, with underground mine establishment on target * First quarter at fully operational status, reporting a gross cash margin at 53% Mimosa * Production 33,252 PGM ounces (Aquarius attributable 16,626 PGM ounces) * Cash costs steady at $331 per PGM ounce, $108 per PGM ounce after by-product credits * Gross cash margin rises to 66% on relatively stable costs and higher PGM basket price * Wedza Phase IV Upgrade, commissioning commenced 8th April, ahead of schedule and to budget CTRP * PGM production marginally down 3% to 1,484 PGM ounces (Aquarius attributable 742 PGM ounces) * Significant operational improvement as recoveries increase to 51% from 27% in the previous quarter * Improvement in unit costs, down 42% lower than previous quarter at R2000 per PGM ounce * Gross cash margin improves to 65% from 43% in the previous quarter Commenting on the results, Stuart Murray, CEO said. "The group has achievedrecord quarterly production, notably with the new Everest mine contribution, ata time of good platinum group metal basket prices, to deliver a significant netprofit. I believe that this performance is satisfactory, notwithstandingcertain operational difficulties that we encountered at both at Kroondal andMarikana. Whilst rain is always welcome in Africa, for open pit miners likeAquarius at Marikana, the abnormally high rainfall during the quarter has hurtproduction. Encouragingly, trial underground mining at Marikana is progressingwell and we are confident that the long-term solution for this operation is nowassured through the P&SA2 and underground operations in general."Production by MinePGMs (4E) Quarter Ended Jun 2005 Sep 2005 Dec 2005 March 2006 Kroondal 116,669 115,362 117,175 107,501 Marikana 26,940 27,322 20,789 5,810 Mimosa 35,644 36,368 35,394 33,252 CTRP 1,473 1,363 1,533 1,484 Everest - - 7,111 46,081 Total 180,726 180,415 182,002 194,128Production by Mine Attributable to AquariusPGMs (4E) Quarter Ended Jun 2005 Sep 2005 Dec 2005 March 2006 Kroondal 58,335 57,681 58,588 53,751 Marikana 26,940 27,322 10,394 2,905 Mimosa 17,822 18,184 17,697 16,626 CTRP 737 682 767 742 Everest - - 7,111 46,081 Total 103,834 103,869 94,557 120,105Aquarius announces consolidated earnings for the quarter to 31 March 2006 of$18.6 million (US 22.2 cents per share) on a 27% increase in attributableproduction. The newly commissioned Everest mine made a significant contributionin the quarter. Cash earnings (before depreciation and amortisation) were $26.7million.Aquarius Attributable Production and Net Profit Summary Quarter: Quarter: Quarter: Sep 2005 Dec 2005 Mar 2006 PGM Production (4E) (attributable ounces) 103,869 94,557 120,105 Net Profit After Tax & Outside Equity $9.9 m $16.0 m $18.6 mInterests Production of PGMs attributable to shareholders of Aquarius was 120,105 PGMounces, up 27% from the previous quarter ended December 2005.Revenue for the quarter, net of currency adjustments, was $115 million, up 46%from the previous quarter. Net finance costs for the quarter were $0.6 million.Depreciation was $3.7 million for the quarter. Amortisation arising from thefair value uplift of mineral rights at $4.3 million reflects increasedproduction.Aquarius Group cash balances at 31 March 2006 were $119.4 million, an increaseof $34.4 million since December 2005. The increased cash balance reflects lowercapital expenditure of $25 million incurred in the quarter and significantlyhigher PGM revenue, up 46% from the previous quarter, due to higher metalprices and production.Over the quarter, the Rand strengthened 6% against the US Dollar impacting oncosts in US Dollar terms. This was, however, offset by increased production andhigher US Dollar PGM basket prices achieved during the quarter, contributing tothe improved quarterly profit performance.Kroondal's cash costs per ROM ton increased 2% to R181 compared with theprevious quarter due to fewer working days as a result of Christmas and NewYear holidays. Cash costs per PGM ounce for the quarter increased by 3% toR2,514. These costs include R219 per PGM ounce of decline development costscomprising ledging and sinking. Development costs on a PGM ounce basisrepresented R34 per PGM ounce.Marikana's cash costs for the quarter were negatively impacted by lowproduction due to very heavy rains. Because of the low levels of production inthe quarter, the implementation of the P&SA2 and the mobilisation of the newmining contractor, on mine cash costs on a PGM ounce basis do not reflectsteady state production and are not comparable to previous quarters.Mimosa realised a cash cost per PGM ounce of US$331 ($108 per ounce afterby-product credits) compared with the previous quarter's figure of US$325 perounce ($94 per ounce after by-product credits). The 2% increase in costs isattributable to a lower volume realised in this quarter compared with theprevious quarter, due to the Christmas and New Year holidays.Metals PricesThe value of the South African PGM basket continued to rise during the quarterto close at R7,188 per PGM ounce, an 18% increase since the end of December2005. This price strength has continued into the current quarter, having at onepoint broken through the historic highs of 2001. The average Zimbabwean PGMbasket over the quarter was 13% higher at US$750 per PGM ounce, and went on toclose 18% higher quarter on quarter at US$877 per PGM ounce.Although the country basket prices underwent similar increases, the reasonswere different. The South African basket is heavily biased towards platinum andrhodium, the prices for which increased 12% and 14% respectively over thequarter. In Zimbabwe, where the basket is less platinum rich and more balancedwith lower priced palladium, the overall basket price nonetheless increased 18%over the quarter owing to a quarter on quarter 29% increase in the palladiumprice to close at US$332 per ounce.FinancialsAquarius Platinum LimitedConsolidated Income StatementQuarter ended 31 March 2006US$'000 Quarter Nine Financial ended* months year ended ended* 31/03/06 31/03/06 30/06/05 Aquarius PGM Production (attributable 120,105 318,531 327,669ounces) Note Revenue (i) 116,939 276,645 222,327 Forex sales adjustments (ii) (1,900) (4,197) 2,797 Total revenue 115,039 272,448 225,124 Cost of sales (iii) (58,798) (157,348) (174,936) Gross profit 56,241 115,100 50,188 Amortisation of fair value uplift of (4,289) (8,014) (6,745)mineral properties Gross profit after amortisation of fair 51,952 107,086 43,443value uplift Admin & other costs (3,218) (5,201) (5,976) Finance costs (iv) (573) 634 484 FX movements (v) (3,638) (5,962) (9,889) Profit before tax 44,523 96,557 28,062 Income tax expense (12,860) (25,441) (3,446) Profit after tax 31,663 71,116 24,616 Minority interest (vi) (13,019) (26,557) (3,666) Net profit for the period 18,644 44,559 20,950 Earnings per share (basic - cents) 22.2 53.1 25.3* UnauditedNotes on the Consolidated Income Statement i. Revenue is up 46% from the previous quarter due to increased production and higher PGM prices ii. Reflects effects of adjusting revenue recorded at time of production to cash received at the end of the four month pipeline iii. Cost of sales on a per PGM ounce basis (Aquarius Group) are in line with previous quarter's performance iv. Finance costs reflect interest expense on Group interest bearing borrowings v. Reflects foreign exchange movements on translation of net monetary assets vi. Minority interests reflects 29.5% and 20% outside equity interest of Savannah Consortium and Impala Platinum Holdings Limited (Implats) in AQPSA Aquarius Platinum LimitedConsolidated Cash Flow StatementQuarter ended 31 March 2006US$'000 Quarter Nine months Financial ended* ended* year ended 31/03/06 31/03/06 30/06/05 Note Net operating cash inflow (i) 56,678 115,378 31,458 Net investing cash outflow (ii) (25,010) (100,417) (88,152) Net financing cash inflow (iii) 2,915 26,412 54,921 Net increase (decrease) in cash held 34,583 41,373 (1,773) Opening cash balance 84,954 75,251 77,942 Exchange rate movement on cash (154) 2,759 (918) Closing cash balance 119,383 119,383 75,251* UnauditedNotes on the YTD Consolidated Cash Flow Statement i. Net operating cash flow includes $129.4 million net inflow from operations, $0.4 million net finance costs and $13.6 million income tax payments ii. Reflects payments for mine construction costs relating mainly to the new Everest operation iii. Reflects net proceeds from redraw of finance facilities of $28.1 million, conversion of options $5.0 million, dividends paid of $9.2m and repayment of share plan loans and option conversion $2.5 million Aquarius Platinum LimitedConsolidated Balance Sheetat 31 March 2006US$'000 Note 31 March 06 * 30 June 05 Assets Cash assets (i) 119,383 75,251 Current receivables (ii) 50,144 44,695 Other current assets (iii) 21,463 16,312 Non-current receivables (iv) 295 2,928 Mining assets (v) 501,643 408,765 Other non-current assets 663 541 Total Assets 693,591 548,492 Liabilities Current liabilities (vi) 44,415 35,480 Non-current payables (vii) 160,316 150,735 Non-current interest-bearing (viii) 44,705 16,037liabilities Other non-current liabilities (ix) 100,708 78,315 Total Liabilities 350,144 280,567 Net Assets 343,447 267,925 Equity Parent entity interest 281,730 235,352 Minority interest 61,717 32,573 Total Equity 343,447 267,925* UnauditedNotes on the Consolidated Balance Sheet i. Cash balance rose due to strong operating cash flows during the quarter ii. Reflects debtors receivable on PGM concentrate sales iii. Increase reflects stockpile build up to accommodate the Everest expansion iv. Reduction attributable to the repayment of employee share plan loans v. Increase in mining assets mainly relates to Everest construction vi. Includes tax payable ($10 million) and creditors ($34 million) vii. Reflects deferred income from BEE transaction ($10.6 million) and portion of Implats and Savcon non interest bearing shareholder loans (Impala Platinum $66.9 million and Savcon $82.8 million) viii. Reflects non-current portion of interest bearing debt payable to RMB ($27.2 million) and interest bearing shareholder loan to Savcon ($17.5 million) ix. Reflects deferred tax liabilities $66 million and provision for closure costs $35 million OperationsAQUARIUS PLATINUM (SOUTH AFRICA) (PTY) LTD (Aquarius Platinum 50.5%)Kroondal MineSafetyThe (12 month rolling average) DIIR improved marginally to 0.93 from 0.96 inthe previous quarter. The Mine achieved 800,000 fatality-free man shifts.Mining * Underground operations hoisted 1.32 million tons from 192,000 square meters mined, with a further 72,000 tons from opencast mining * Decline development at the No. 5 Shaft is on track, expecting to intersect UG2 reef in late 2006 Processing * Plant feed was 1.49 million tons processed, including 106,000 tons from the stockpile * Due to shorter working quarter, PGM production down 8% to 107,501 PGM ounces * Concentrator plants performed well with recoveries improving 2% to 78% RevenueThe PGM basket price for the quarter increased 12% to $1,064 per PGM ounce,resulting in mine revenue of R686m for the quarter (AQPSA share R343m). Thegross cash margin rose to 61%, reflecting the higher PGM prices.Kroondal: Metal in concentrate produced (PGM ounces)Quarter ended Pt Pd Rh Au PGMs PGMs attributable to Aquarius March 06 64,248 31,372 11,342 539 107,501 53,751 Dec 05 69,830 34,332 12,422 591 117,175 58,588 Sept 05 69,129 33,420 12,250 563 115,362 57,681 Jun 05 69,875 33,728 12,499 567 116,669 58,335OperationsThe mining operations were impacted by the Christmas and New Year holidaybreaks with a slower than desired ramp up in the New Year. This resulted in 85operating days in the quarter, 6 days less than the previous quarter.Operations produced a total 1.4 million ROM tons, and a 25,000 ton stockpileremains on the surface for processing. PGM production for the quarter was 8%lower at 107,501 PGM ounces (Aquarius attributable 53,751 PGM ounces).Plant head grade was 3% lower at 2.85g/t due to higher than normal potholing atNo. 3 Shaft. Increased development is ongoing to overcome this problem.Although negatively impacting on production, this was partly offset byexcellent plant performance. Following ongoing re-engineering, overallrecoveries improved 2% despite the reduced head grade to the K2 plant. The K1concentrator achieved recoveries of 80%+ during the last two month's of thequarter following adjustments to the circuit. The K2 concentrator alsounderwent a phase of re-engineering to improve plant performance.Cash costs per ROM ton increased 2% to R181 compared with the previous quarterin part due to lower comparable period on period production. Cash costs per PGMounce for the quarter increased by 3% to R2,514. Importantly, these costsinclude R219 per PGM ounce of decline development costs comprising ledging andsinking. Development costs on a PGM ounce basis represented R34 per PGM ounce.Development and equipping of additional underground mining areas continues atthe Central, East and No. 3 and No. 5 Shafts. Decline sinking is approximately1,000 metres ahead of schedule which will ensure that P&SA1 is able to sustainproduction going forward pending the production ramp-up at the new No. 5 shaft.No. 4 ShaftNo. 4 shaft was transferred to P&SA2 at the start of the quarter under reviewas part of the P&SA2 Agreement and the associated capital expenditures werealso transferred to the P&SA2 books.Project Management and Capital ExpenditureCapital expenditure for the next quarter is expected to be R23 millioncomprising the following: a. Ongoing Mine Equipping: The ongoing installation of conveyors and associated equipment is progressing well against schedule. b. Chairlifts: Chairlift installations at Central and East mines are nearing completion. This will reduce the travelling time of the workforce resulting in a positive effect on productivity. c. No. 5 Shaft (Townlands): Sinking of this decline commenced in February 2006 and is at 148m at the end of the quarter. It is expected that reef will be intersected in October this year. R51m of the R131m budget has been committed to date and the project is expected to be completed on budget. Marikana MineComparatives between the current quarter and the previous quarter are notmeaningful owing to the appointment of a new open pit mining contractor, MCC inJanuary 2006 (currently in ramp-up mode) in place of the previous contractorwhose contract was rescinded in December 2005.SafetyThe (12 month rolling average) DIIR rate improved to a record 0.23 from 0.72 inthe previous quarter. The Mine recorded 627,946 fatality-free shifts.Mining * Open pit mining contractor MCC has mobilised to schedule, recording a good performance in the face of adverse weather conditions * No. 4 shaft underground production build-up & service infrastructure is on schedule * Trial mining at No. 1 shaft continues to advance, with favourable mining conditions continuing * ROM Stockpiles at the end of the quarter totalled 124,000 tons Processing * Concentrator throughput for the quarter was 178,000 tons (94,000 from P&SA2 and including 84,000 tons treated on behalf of Anglo Platinum) * Recoveries improved to 66% for the quarter (62% previous quarter) * New contractor in ramp-up mode produced 5,810 PGM ounces for the quarter from 94,000 tons, (AQPSA attributable 2,905 PGM ounces) * ROM stockpiles built up in March contain an estimated recoverable 6,400 PGM ounces RevenueThe PGM basket price for the quarter increased 11% to $1,028 per PGM ounce,resulting in mine revenue of R51m for the quarter (AQPSA share R25 million).The cash margin decreased to 4% and cash costs increased to R8,416 per ounce.Marikana: Metal in concentrate produced (PGM ounces)Quarter ended Pt Pd Rh Au PGMs March 06 3,591 1,642 534 43 5,810 Dec 05 12,887 5,879 1,861 162 20,789 Sept 05 17,244 7,409 2,466 203 27,322 Jun 05 16,893 7,402 2,428 217 26,940Operations94,000 ROM tons were processed resulting in PGM production for the quarter of5,810 PGM ounces. Due to open pit water issues, an opportunity to toll mill84,000 tons of ore on behalf of Anglo Platinum was undertaken.ROM stockpiles were built up from 54,000 tons to 124,000 tons by the end of thequarter, containing an estimated 6,400 recoverable PGM ounces. In April, 60% ofthis stockpile yielding approximately 4,000 PGM ounces is scheduled to betreated, in addition to planned production.The low production rate for the quarter was the result of both the pattern ofrainfall and the unusually high rainfall in January and February which floodedthe main open-pit bottom. Over one week at the beginning of January, 300 mm (12inches) of rain fell at the operation. Some four weeks later, 230mm (9 inches)of rain then again fell over one week, an amount approximating the typicalannual rainfall for the area over a rainy season, and an amount almost fourtimes as much as would fall on average for January and February combined.During this period, three 1-in-10 year flood events were recorded in thesurrounding area. In-pit pumping capacity was increased five fold to allow MCCaccess to pit bottom for reefing operations during the month of March. Access,however, was denied to reefing operations for nearly two-thirds of theavailable time during January and February.MCC have mobilised on site and are on schedule to deliver the full productionschedule for the main pit by the end of the financial year despite the floodingsetback that occurred during the quarter. The toll milling has allowed theprocess plant to operate during March whilst the open pit was being de-wateredand reefing operations were being re-established with the objective of buildingan ore stockpile.Cash costs for the quarter were negatively impacted as a result of poorproduction affected by the heavy rains.Due to the very low levels of production in the quarter, on mine cash costs ona PGM ounce basis do not reflect steady state production and are not comparableto previous quarters.Marikana Pool & Share Agreement (P&SA2)Production from No. 4 Shaft during the quarter progressed to plan. Undergrounddevelopment and construction infrastructure are also progressing on schedule.The upgrading of the process plant to 250,000 tons per month capacity by theincorporation of a dense media separator commenced during the quarter andremains on schedule.Project Management and Capital ExpenditureCapital expenditure for the next quarter is expected to be R15 million.Trial Underground Mining (No. 1 Shaft)The declines have progressed approximately 200 metres with favourable miningconditions persisting. The portal highwall was permanently supported during thequarter with shotcrete. Belt and services infrastructure installations havecommenced. Production and service construction, delayed due to heavy rains, hasbeen revised to ensure that the program remains on schedule.Contractor dispute with Moolman MiningAQPSA resiled from the mining contract with Moolman Mining during December 2005on the basis of a misrepresentation on the part of Moolman Mining when themining contract was originally concluded. This misrepresentation becameapparent to AQPSA after the audit, conducted by KPMG during October 2005, intothe rise and fall formula applied in the mining contract.In the notice of rescission, AQPSA advised Moolman Mining that AQPSA would beinstituting a damages claim against Moolman Mining arising from the rescission.Summons for the damages claim in an amount of R 963,775,098 was served onGrinaker-LTA on 18 April 2006.Everest MineSafetyThe (12 month rolling average) DIIR deteriorated to 0.82 from 0.77 in thequarter. Corrective action initiated early in the quarter has had positiveresults with no disabling injuries occurring during the last month of thequarter. The Department of Minerals and Energy has issued its investigationreport into the fatality that occurred in the previous quarter. The reportconcluded that the deceased had failed to secure himself appropriately althoughhe had been provided with a safety harness and been trained in the use of asafety harness.Mining * Opencast operations are ahead of schedule with 217,052 tons produced during the period * Underground development continues, producing 157,362 tons in the period * Stockpiles at the end of the quarter totalled 143,000 tons Processing * Concentrator throughput ramp-up remains ahead of schedule, with 674,720 tons processed during the period * Overall recoveries increased by 10% to 65%, exceeding expectations for the ramp-up period * 46,081 PGM ounces were produced during the period RevenueThe realised PGM basket price for the quarter was $964 per PGM ounce, resultingin mine revenue of R225 million for the quarter (AQPSA share 100%).Everest: Metal in concentrate produced (PGM ounces)Quarter ended Pt Pd Rh Au PGMs (4E) Mar-06 27,257 14,913 3,472 439 46,081 Dec-05 4,161 2,351 532 67 7,111 OperationsOpencast mining remained ahead of programme, with a total of 217,000 tonsproduced during the quarter. The opencast mining operation continues to performwell in terms of production and cost, providing the bulk of the plant feed todate.Underground mining also progressed well during the period, with on-reef declinedevelopment and the establishment of stoping sections continuing. Theunderground production ramp-up was as planned with an 85% increase inproduction to 157,000 tons of underground ROM tons produced during the quarter.Equipping of the underground mining remains on track with conveyorinstallations, ventilation and mining services completed on schedule. Theunderground mining is ramping up as planned within budget, and no significantgeological or mining problems have been experienced.The ramp-up of the concentrator proceeded well with 674,720 tons milled duringthe period. Plant head grade improved to 3.22 g/t from 3.12 g/t in the previousquarter, with 70 % of the plant feed consisting of opencast material. Theimprovement in operational stability following commissioning was reflected inthe metallurgical recoveries, which improved by 10% to 65%. This yieldedproduction of 46,081 PGM ounces for the period.Process plant availability and the throughput ramp-up remain encouraging. Astockpile of 143,000 ROM tons remained at the end of the quarter.The quarter was the first operational quarter, achieving on mine cash costs ofR156 per ROM ton milled and R2,280 per PGM ounce. This is inclusive of ledgingand sinking costs, of R215 per PGM ounce.Project Capital ExpenditureThe project capital expenditure commitments totalled R672 million at the end ofthe quarter with capital expenditure to date of R609 million.It is anticipated that the Everest project which was originally budgeted atR819 million will be completed for R707 million, a saving of R112 million.Mimosa Mine (Aquarius Platinum 50%)SafetyThe good safety record was marred by three disabling injuries incurred in thequarter compared with one in the previous quarter, resulting in a (12-monthrolling average) DIIR for the quarter was 0.23, compared with 0.13 in theprevious quarter.OperationsPGM production for the quarter was 6% above targeted levels at 33,252 PGMounces. ROM tonnage for the quarter was 399,000 tons compared with 429,000 forthe previous quarter. The decrease is attributable to less operating daysarising from the holiday season. Tons milled during the quarter at 365,000 were4% below the previous quarter's level of 279,000 tons as a result of a 5-dayplant shutdown for mill relining. Plant feed grade remained almost at par at3.69g/t and 3.72g/t for the current and previous quarter respectively.RevenueThe average basket price realised in the quarter at $750 per PGM ounce, 13%stronger than the previous quarter price of $662 per PGM ounce. Together withthe contribution from base metals (approximately 27% of gross revenue), thisgenerated sales revenue of $27.3 million compared with $27.8 million for theprevious quarter.Mimosa: Metal in concentrate produced (PGM ounces)Quarter Pt Pd Rh Au PGMs (4E) PGMs (4E) ended attributable to Aquarius March 06 16,820 12,809 1,306 2,317 33,252 16,626 Dec 05 17,961 13,582 1,390 2,461 35,394 17,697 Sept 05 18,548 13,915 1,407 2,498 36,368 18,184 Jun 05 18,269 13,518 1,406 2,451 35,644 17,822Mimosa: Base Metals in concentrate produced (tons) Mine Production Attributable to Aquarius Quarter Ni Cu Co Ni Cu Co ended March 06 452 383 14 226 191 7 Dec 05 488 410 15 244 205 8 Sept 05 512 422 15 256 211 8 Jun 05 514 420 15 257 210 8Operating costsMimosa realised a cash cost per PGM ounce of US$331 ($108 per ounce afterby-product credits) compared with the previous quarter's figure of US$325 perounce ($94 per ounce after by-product credits). The 2% increase in costs isattributable to a lower volume realised in the quarter compared with theprevious quarter.Wedza Phase IV UpgradeWork on the Wedza Phase IV Upgrade project has progressed well. Commissioninghas commenced subsequent to the end of the quarter on 8th April, 6 weeks aheadof schedule.Proposed Amendments to the Mines and Minerals BillThe Zimbabwe Minister of Mines and Mining Development issued a statement duringthe quarter proposing radical changes to the Mines and Minerals Act which wouldimpact negatively on the business environment in Zimbabwe. Following furtherrepresentations by the Company and the Chamber of Mines of Zimbabwe, it hassince been clarified that the statement was no more than an expression of anopinion on an issue that is still work in progress. Meanwhile the company ispursuing its indigenisation agenda for discussion with the relevant authoritiesonce the work has been finalised.AQUARIUS PLATINUM (SA) CORPORATE SERVICES (PTY) LTDChromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum 50%)SafetyNo accidents or lost time injuries have occurred since the start-up of the CTRPin February 2005.Processing * 26,422 tons processed for the quarter, significantly reduced due to the decision to not treat poor recovery materials * 1,484 PGM ounces produced, a decrease of 3% on the previous quarter despite 58% decrease in tons processed * Recoveries up to 51% from 27% in the previous quarter OperationsDuring the quarter only current arisings from the Kroondal Chrome Mine were fedto the CTRP. The feed of dump material from Bayer Chrome Mine was stopped dueto poor recoveries achieved in the second quarter. The effect was thatrecoveries rose to 51% against 27% in the previous quarter. Consequently, unitcosts decreased by 42% to R2,000 per PGM ounce from R3,441 per PGM ounce in theprevious quarter.Following the results of the initial Mintek testwork, a small expansion projectis planned to increase plant throughput and production. This expansion will adddump material from the Kroondal Chrome Mine to the CTRP feed. It is anticipatedthat this project will be completed in the first quarter of the 2007 FinancialYear at a cost of approximately R2 million.Additional testwork has also been commissioned at Mintek to further optimisethe recoveries achievable with the various feed sources.CORPORATE MATTERSConversion of South African mining and prospecting rights a. Mining Rights: The conversion applications for Kroondal and Marikana have been submitted by the Regional Office of the Department of Minerals and Energy to their Head Office in Pretoria for approval. The conversion for Everest will be submitted to the DME Head Office during May2006. b. Prospecting Rights: All prospecting right conversions have been granted. Appointment of Anton WheelerIn May 2006, Anton Wheeler will join the AQPSA team as Operations Director.Anton is a qualified mining engineer and brings a wealth of knowledge inopencast and underground platinum mining experience. He has a track recordincluding implementing "best practice" at Impala Platinum, and laterly workedat Zimplats in Zimbabwe. All AQPSA mining operations will report to him.Dividend paid to Aquarius shareholders'On 23rd March 2006, an interim dividend of 6 US cents per share (2005: 3 UScents per share) was paid to shareholders registered on 2 March 2006.Statistical Information: Kroondal P&SA1 Data reflects 100% of Current Previous % Change Current mine operations Unit Quarter Quarter Quarter 9 months March Dec 2005 on to Mar 06 2006 Quarter Safety DIIR Rate/ 0.93 0.96 (3) 0.93 200,000 man hours Revenue Gross Revenue R'M 686 654 5 1,912 PGM basket Price $/oz 1,064 946 12 942 Gross cash margin % 61 56 9 56 Nickel Price $/lb 6.72 5.74 17 6.35 Copper Price USc/lb 224 195 15 197 Ave R/$ rate 6.13 6.51 (6) 6.39 Cash Costs on-mine Per ROM ton R/ton 181 177 2 180 $/ton 30 27 9 28 Per PGM oz (3E+Au) R/oz 2,514 2,429 3 2,476 $/oz 410 373 10 388 Per PGE (5E+Au) R/oz 2,075 2,303 (10) 2,039 $/oz 339 354 (4) 319 Capex Current/Sustaining 100% R'000s 5,237 17,003 (69) 38,761 $'000s 854 2,612 (67) 6,070 Expansion 100% R'000s (14631) * 25,301 43,306 $'000s (2386) * 3,886 6,782 Mining Processed Underground ROM Ton 1,420 1,446 (2) 4,331 '000 Open Pit ROM Ton 72 160 (55) 357 '000 Total ROM Ton 1,492 1,606 (7) 4,688 '000 Grade Plant Head g/t 2.85 2.96 (4) 2.90 Recoveries % 78 77 2 78 PGM Production Platinum Ozs 64,247 69,830 (8) 203,207 Palladium Ozs 31,372 34,332 (9) 99,124 Rhodium Ozs 11,342 12,422 (9) 36,014 Gold Ozs 540 591 (9) 1,694 Total PGM (3E+Au) Ozs 107,501 117,175 (8) 340,039 Total PGE (5E+Au) Ozs 130,222 142,650 (9) 412,890 Base Metals Production Nickel Tons 104 112 (7) 326 Copper Tons 49 50 (2) 147 Chromite (000) Tons (000) 115 145 (21) 373 Data reflects 100% of Previous +/- % YTD mine operations Unit 9 months to Year on 9 months to March 05 Year March 2006 Safety DIIR Rate/200,000 0.72 29 0.93 man hours Revenue Gross Revenue R'M 784 144 1,912 PGM basket Price $/oz 700 35 942 Gross cash margin % 37 51 56 Nickel Price $/lb 6.56 (3) 6.35 Copper Price USc/lb 139 41 197 Ave R/$ rate 6.12 4 6.39 Cash Costs on-mine Per ROM ton R/ton 185 (3) 180 $/ton 30 (6) 28 Per PGM oz (3E+Au) R/oz 2,369 5 2,476 $/oz 387 0 388 Per PGE (5E+Au) R/oz 2,281 (11) 2,039 $/oz 373 (14) 319 Capex Current/Sustaining 100% R'000s 2068 1,774 38,761 $'000s 338 1,696 6,070 Expansion 100% R'000s 395,176 (89) 43,306 $'000s 64,607 (90) 6,782 Mining Processed Underground ROM Ton '000 2,454 76 4,331 Open Pit ROM Ton '000 206 73 357 Total ROM Ton '000 2,660 76 4,688 Grade Plant Head g/t 3.07 (6) 2.90 Recoveries % 80 (3) 78 PGM Production Platinum Ozs 124,416 63 203,207 Palladium Ozs 60,256 65 99,124 Rhodium Ozs 22,416 61 36,014 Gold Ozs 973 74 1,694 Total PGM (3E+Au) Ozs 208,061 63 340,039 Total PGE (5E+Au) Ozs 252,147 64 412,890 Base Metals Production Nickel Tons 195 67 326 Copper Tons 89 65 147 Chromite (000) Tons (000) 189 98 373 Note:* Capital expenditure reversal on expansion reflects the transfer of No. 4Shaft to P&SA2.Statistical Information: Marikana P&SA2Data reflects 100% of mine Current Previous % Change Current operations Unit Quarter Quarter Quarter 9 months March 2006 Dec 2005 on to Mar 06 Quarter Safety DIIR Rate/ 0.23 0.72 (68) 0.32 200,000 man hours Revenue Gross Revenue R'M 51 70 (27) 297 PGM basket Price $/oz 1,028 925 11 918 Gross cash margin % 4 24 (85) 1 Nickel Price $/lb 6.72 5.74 17 6.35 Copper Price USc/lb 224 195.00 15 197 Ave R/$ rate 6.13 6.51 (6) 6.39 Cash Costs on-mine Per ROM ton R/ton 520 334 56 353 $/ton 85 51 (5) 55 Per PGM oz (3E+Au) R/oz 8,416 5,132 64 5,427 $/oz 1,373 788 74 850 Per PGE (5E+Au) R/oz 6,974 4,879 43 4,509 $/oz 1,138 749 52 706 Capital expenditure Current/Sustaining 100% R'000s 1,202 3,312 (64) 7,948 $'000s 196 509 (61) 1,245 Expansion 100% R'000s 50,591 8,147 521 58,738 $'000s 8,253 1,251 560 9,199 Mining Processed Underground ROM Ton 43 28 54 79 '000 Open Pit ROM Ton 51 291 (82) 751 '000 Total ROM Ton 94 319 (71) 830 '000 Grade Plant Head g/t 2.93 3.24 (10) 3.22 Recoveries % 66 62 6 63.00 PGM Production Platinum Ozs 3,591 12,887 (72) 33,721 Palladium Ozs 1,642 5,879 (72) 14,930 Rhodium Ozs 534 1,861 (71) 4,861 Gold Ozs 43 162 (73) 408 Total PGM (3E+Au) Ozs 5,810 20,789 (72) 53,920 Total PGE (5E+Au) Ozs 7,011 24,999 (72) 64,899 Base Metals Production Nickel Tons 8 32 (75) 80 Copper Tons 4 17 (76) 45 Chromite (000) Tons 13 44 (70) 117 (000) Data reflects 100% of Previous +/- % YTD mine operations Unit 9 months Year on 9 months to March Year to Mar 06 05 Safety DIIR Rate/ 1.09 (71) 0.32 200,000 man hours Revenue Gross Revenue R'M 259 15 297 PGM basket Price $/oz 701 31 918 Gross cash margin % (17) n/a 1 Nickel Price $/lb 6.56 (3) 6.35 Copper Price USc/lb 139 41 197 Ave R/$ rate 6.12 4 6.39 Cash Costs on-mine Per ROM ton R/ton 273 29 353 $/ton 45 23 55 Per PGM oz (3E+Au) R/oz 4,206 29 5,427 $/oz 688 24 850 Per PGE (5E+Au) R/oz 4,027 12 4,509 $/oz 658 7 706 Capital expenditure - Current/Sustaining 100% R'000s 13,309 (40) 7,948 $'000s 2,176 (43) 1,245 Expansion 100% R'000s - n/a 58,738 $'000s - n/a 9,199 Mining Processed Underground ROM Ton - n/a 79 '000 Open Pit ROM Ton 1,111 (32) 751 '000 Total ROM Ton 1,111 (25) 830 '000 Grade Plant Head g/t 3.72 (14) 3.22 Recoveries % 55 15 63 PGM Production Platinum Ozs 46,975 (28) 33,721 Palladium Ozs 19,012 (21) 14,930 Rhodium Ozs 5,633 (14) 4,861 Gold Ozs 602 (32) 408 Total PGM (3E+Au) Ozs 72,222 (25) 53,920 Total PGE (5E+Au) Ozs 85,566 (24) 64,899 Base Metals Production Nickel Tons 87 (8) 80 Copper Tons 46 (1) 45 Chromite (000) Tons 169 - 117 (000) Statistical Information: EverestData reflects 100% of mine Current Previous % Change Current operations Unit Quarter Quarter Quarter 9 months March 2006 Dec 2005 on to Mar 06 Quarter Safety DIIR Rate/ 0.82 0.77 6 0.82 200,000 man hours Revenue Gross Revenue R'M 225 31 626 225 PGM basket Price $/oz 964 886 9 964 Gross cash margin % 53 28 89 53 Nickel Price $/lb 6.72 6.09 10 6.72 Copper Price USc/lb 224 208.00 8 224 Ave R/$ rate 6.14 6.35 (3) 6.14 Cash Costs on-mine Per ROM ton R/ton 156 168 (7) 156 $/ton 25 27 (5) 25 Per PGM oz (3E+Au) R/oz 2,280 3,136 (27) 2,280 $/oz 371 494 (25) 371 Per PGE (5E+Au) R/oz 1,974 2,635 (25) 1,974 $/oz 321 415 (23) 321 Capital expenditure Current/Sustaining 100% R'000s - - - $'000s - Expansion 100% R'000s 67,094 203,272 (67) 67,094 $'000s 10,927 32,047 (66) 10,927 Mining Processed Underground ROM Ton 202 39 418 202 '000 Open Pit ROM Ton 473 89 431 473 '000 Total ROM Ton 675 129 423 675 '000 Grade Plant Head g/t 3.22 3.12 3 3.22 Recoveries % 65 55 18 65 PGM Production Platinum Ozs 27,257 4,161 555 27,257 Palladium Ozs 14,913 2,351 534 14,913 Rhodium Ozs 3,472 532 553 3,472 Gold Ozs 439 67 555 439 Total PGM (3E+Au) Ozs 46,081 7,111 548 46,081 Total PGE (5E+Au) Ozs 53,202 8,223 547 53,202 Base Metals Production Nickel Tons 54 8 591 54 Copper Tons 28 5 464 28 Chromite (000) Tons - - - (000) Data reflects 100% of Previous +/- % YTD mine operations Unit 9 months Year on 9 months to March Year to Mar 06 05 Safety DIIR Rate/ - - 0.82 200,000 man hours Revenue Gross Revenue R'M - - 225 PGM basket Price $/oz - - 964 Gross cash margin % - - 53 Nickel Price $/lb - - 6.72 Copper Price USc/lb - - 224 Ave R/$ rate - - 6.14 Cash Costs on-mine Per ROM ton R/ton - - 156 $/ton - - 25 Per PGM oz (3E+Au) R/oz - - 2,280 $/oz - - 371 Per PGE (5E+Au) R/oz - - 1,974 $/oz - - 321 Capital expenditure - Current/Sustaining 100% R'000s - - - $'000s - - - Expansion 100% R'000s - - 67,094 $'000s - - 10,927 Mining Processed Underground ROM Ton - - 202 '000 Open Pit ROM Ton - - 473 '000 Total ROM Ton - - 675 '000 Grade Plant Head g/t - - 3.22 Recoveries % - - 65 PGM Production Platinum Ozs - - 27,257 Palladium Ozs - - 14,913 Rhodium Ozs - - 3,472 Gold Ozs - - 439 Total PGM (3E+Au) Ozs - - 46,081 Total PGE (5E+Au) Ozs - - 53,202 Base Metals Production Nickel Tons - - 54 Copper Tons - - 28 Chromite (000) Tons - - - (000) Statistical Information: Mimosa Data reflects Current Previous % Current Previous +/- % 100% of mine Change operations Unit Quarter Quarter Quarter 9 9 months Year 9 Mar Dec 2005 on months to Mar on months 2006 Quarter to Mar 05 Year to Mar 06 06 Safety DIIR - 12 Month Rate/ 0.40 0.13 208 0.21 0.3 (30) rolling Average 200,000 man hours Revenue Gross Revenue US$M 27 28 (2) 83 61 36 PGM basket Price $/oz 750 662 13 672 585 15 Gross cash % 66 64 3 62 61 2 margin Nickel Price $/lb 6.14 6.13 0 6.41 6.31 2 Copper Price USc/lb 201 171 18 172 115 50 Cash Costs on-mine Per ROM ton $/ton 30 30 - 32 31 3 Per PGM oz $/oz 331 325 2 339 346 (2) (3E+Au) after by-product $/oz 108 94 15 102 132 (23) credits Capital expenditure Current/ $'000s 705 1,895 (63) 5,032 11427 (56) Sustaining 100% Expansion 100% $'000s 6,526 1,050 522 7,576 738 927 Mining Underground ROM Ton 399 429 (7) 1,261 1037 22 '000 Grade Plant Head g/t PGM 3.69 3.72 (1) 3.73 3.67 2 Recoveries % 77 78 (1) 78 77 1 PGM Production Platinum Ozs 16,820 17,961 (6) 53,328 48,473 10 Palladium Ozs 12,809 13,582 (6) 40,305 35,741 13 Rhodium Ozs 1,306 1,390 (6) 4,102 3,750 9 Gold Ozs 2,317 2,461 (6) 7,277 6,559 11 Total PGM Ozs 33,252 35,394 (6) 105,012 94,523 11 (3E+Au) Base Metals Production Nickel Tons 452 488 (7) 1,452 1,382 5 Copper Tons 383 410 (7) 1,215 1,143 6 Cobalt Tons 14 15 (7) 44 41 7 Statistical Information: Chrome Tailings Retreatment PlantData reflects 100% of mine Current Previous % Change Current operations Unit Quarter Quarter Quarter 9 months March 2006 Dec 2005 on to Mar 06 Quarter Safety DIIR Rate/ - - - - 200,000 man hours Revenue Gross Revenue R'M 8 9 (7) 24 PGM basket Price $/oz 1,276 1,099 16 1,105 Gross cash margin % 65 43 51 49 Nickel Price $/lb 6.72 5.74 17 6.35 Copper Price USc/lb 224 195 15 197 Ave R/$ rate 6.13 6.51 (6) 6.39 Cash Costs on-mine Per ROM ton R/ton 113 87 30 95 $/ton 18 13 (5) 15 Per PGM oz (3E+Au) R/oz 2,000 3,441 (42) 2,839 $/oz 326 529 (38) 445 Per PGE (5E+Au) R/oz 1,386 2,346 (41) 1,998 $/oz 226 360 (37) 313 Capital expenditure Current/Sustaining 100% R'000s - - $'000s - - Expansion 100% R'000s - $'000s - Feed Processed Feed Processed ROM Ton 26 61 - 131 '000 Total ROM Ton 26 61 (57) 131 '000 Grade Plant Head g/t 2.76 2.98 (7) 3.21 Recoveries % 51 27 89 35.00 PGM Production Platinum Ozs 887 937 (5) 2,687 Palladium Ozs 334 350 (5) 966 Rhodium Ozs 260 243 7 718 Gold Ozs 3 3 (2) 9 Total PGM (3E+Au) Ozs 1,484 1,533 (3) 4,380 Total PGE (5E+Au) Ozs 2,142 2,248 (5) 6,225 Base Metals Production Nickel Tons 1 1 - 3 Copper Tons 0 1 - 1 Chromite (000) Tons - - - (000) Data reflects 100% of Previous +/- % YTD mine operations Unit 9 months Year on 9 months to March Year to Mar 06 05 Safety DIIR Rate/ - - - 200,000 man hours Revenue Gross Revenue R'M 0.4 5,900 24 PGM basket Price $/oz 812 36 1,105 Gross cash margin % 30.0 63 49 Nickel Price $/lb - - 6.35 Copper Price USc/lb - - 197 Ave R/$ rate - - 6.39 Cash Costs on-mine Per ROM ton R/ton 13 632 95 $/ton 400 (96) 15 Per PGM oz (3E+Au) R/oz - - 2,839 $/oz - - 445 Per PGE (5E+Au) R/oz - - 1,998 $/oz - - 313 Capital expenditure - Current/Sustaining 100% R'000s - - - $'000s - - - Expansion 100% R'000s - - - $'000s 3,676 - - Feed Processed Feed Processed ROM Ton 20 553 131 '000 Total ROM Ton 20 553 131 '000 Grade Plant Head g/t 2.97 8 3.21 Recoveries % 34 3 35 PGM Production Platinum Ozs 401 570 2,687 Palladium Ozs 136 610 966 Rhodium Ozs 106 577 718 Gold Ozs 1 795 9 Total PGM (3E+Au) Ozs 644 580 4,380 Total PGE (5E+Au) Ozs - - 6,225 Base Metals Production Nickel Tons - - 3 Copper Tons - - 1 Chromite (000) Tons - - - (000) Aquarius Platinum LimitedIncorporated in BermudaExempt company number 26290Board of DirectorsNicholas Sibley - Non-executive ChairmanStuart Murray - Chief Executive OfficerDavid Dix - Non-executiveEdward Haslam - Non-executiveSir William Purves - Non-executive (senior independent director)Patrick Quirk - Non-executiveZwelakhe Sisulu - Non-executiveAudit/Risk CommitteeSir William Purves (Chairman)David DixEdward HaslamNicholas SibleyRemuneration/Succession Planning CommitteeEdward Haslam (Chairman)Nicholas SibleyNomination CommitteeThe full Board comprises the Nomination CommitteeCompany SecretaryWilli BoehmIssued CapitalAt 31 March 2006, the Company had on issue:83,889,892 fully paid common shares2,721,402 unlisted optionsSubstantial Shareholders 31 March 2006 Number of Shares Percentage Impala Platinum Holdings Ltd. 7,141,966 8.6 National Nominees Limited 5,473,050 6.5 Nutraco Nominees Limited 5,162,850 6.2 Chase Nominees Limited 4,341,154 5.2 Broker (LSE)Williams de Broƒ«6 BroadgateLondon EC2M 2RPTelephone: +44 (0)20 7588 7511Facsimile: +44 (0)20 7588 8860Broker (ASX)Euroz SecuritiesLevel 14, The Quadrant1 William StreetPerth WA 6000Telephone: +61 (0)8 9488 1400Facsimile: +61 (0)8 9488 1478Sponsor (JSE)Investec Bank Limited100 Grayston DriveSandown Sandton 2196Telephone: +27 (0)11 286 7326Facsimile: +27 (0)11 291 1066Aquarius Platinum (South Africa) Aquarius Platinum Corporate Services (Proprietary) Ltd. Pty Ltd 50.5% Owned 100% Owned (Incorporated in the Republic of South (Incorporated in Australia) Africa) ACN 094 425 555 Registration Number 2000/000341/07 Level 4, Suite 5, South Shore Centre,Block A, 1st Floor, The Great Wall Group Building 85 The Esplanade, South Perth, WA 6151, 5 Skeen Boulevard, Bedfordview Australia South Africa 2007 PO Box 485 P O Box 1282 South Perth, WA 6151, Australia Bedfordview South Africa 2009 Telephone: +61 (0)8 9367 5211 Telephone: +27 (0)11 455 2050 Facsimile: +61 (0)8 9367 5233 Facsimile: +27 (0)11 455 2095 Email: [email protected] Email: [email protected] AQPSA Management Stuart Murray - Executive Chairman Gert Ackerman - Managing Director Ayanda Khumalo - Finance Director Neil Collett - General Manager Business Development Graham Ferreira - General Manager Finance & Company Secretary Hugo Hƒ¶ll - General Manager Everest Robert Mallinson - General Manager Marikana Gordon Ramsay - General Manager Projects Dave Starley - General Manager Kroondal Gabriel de Wet - General Manager Engineering Mimosa Mine Management Alex Mhembere - Managing Director Winston Chitando - Finance Director Herbert Mashanyare - Technical Director Peter Chimboza - Operations Director GlossaryA$ Australian Dollar Aquarius Aquarius Platinum Limited ABET Adult Basic Education Training programme APS Aquarius Platinum Corporate Services Pty Ltd AQPSA Aquarius Platinum (South Africa) Pty Ltd ASACS Aquarius Platinum (SA) (Corporate Services) (Pty) Limited CTRP Chromite Ore Tailings Retreatment Operation DIFR Disabling Injury Incidence Rate - being the number of lost time injuries expressed as a rate per 1,000,000 man-hours worked DIIR Disabling Injury Incidence Rate - being the number of lost time injuries expressed as a rate per 200,000 man-hours worked EMPR Environmental Management Programme Report Everest Everest Platinum Mine Great Dyke A PGE bearing layer within the Great Dyke Complex in Zimbabwe Reef g/t Grams per tonne, measurement unit of grade (1g/t = 1 part per million) JORC code Australasian code for reporting of Mineral Resources and Ore Reserves JSE JSE Securities Exchange South Africa Kroondal Kroondal Platinum Mine LHD Load Haul Dump machine Marikana Marikana Platinum Mine Mimosa Mimosa Mining Company (Private) Limited NOSA National Occupational Safety Association PGE(s) (6E) Platinum Group Elements. Six metallic elements commonly found together which constitute the platinoids. These are Pt (platinum), Pd (palladium), Rh (rhodium), RU (ruthenium), Ir (iridium) and Os (osmium) PGM(s) (4E) Platinum Group Metals. Aquarius reports the composite grade comprising Pt+Pd+Rh+Au (gold), the Pt, Pd and Rh being the most economic platinoids in the UG2 Reef. P&SA1 Pooling & Sharing Agreement between AQPSA and RPM Ltd on Kroondal P&SA2 Pooling & Sharing Agreement between AQPSA and RPM Ltd on Marikana R South African Rand RK1 Consortium comprising Aquarius Platinum (SA) (Corporate Services) (Pty) Limited (ASACS), GB Mining and Exploration (SA) (Pty) Limited (GB) and Sylvania South Africa (Pty) Ltd (SLVSA) ROM Run of Mine. The ore from mining which is fed to the concentrator plant. This is usually a mixture of UG2 ore and waste. RPM Rustenburg Platinum Mines Limited TKO TKO Investment Holdings Limited Ton 1 Metric tonne (1 000kg) UG2 Reef A PGE bearing chromite layer within the Critical Zone of the Bushveld Complex $ United States Dollars Z$ Zimbabwe Dollar For further information please visit www.aquariusplatinum.com or contact:In Australia: Willi Boehm / Anne Cully Aquarius Platinum Corporate Services Pty Ltd +61 (0)8 9367 5211 In the United Kingdom: Alex Buck BuckBias Limited +44 (0)7392 740 452 In South Africa: Gert Ackerman Aquarius Platinum (South Platinum) (Pty) Ltd +27 (0)14 536 4001 Charmane Russell Russell & Associates +27 (0)11 880 3924 ENDAQUARIUS PLATINUM LIMITEDRelated Shares:
AQP.L