Preliminary Results

RNS Number:9242O
Northam Platinum Ld
3 August 2000


NORTHAM PLATINUM LIMITED
Registration Number 1977/003282/06
Incorporated in the Republic of South Africa

Preliminary Announcement of Results for the year ended 30 June 2000

Life of mine extended by 18 years to 23 years
Headline earnings increase by 110%
Turnover exceeds R1 billion
Dividends per share increase by 380%

Income statement
IAS Basis                                          Appropriation Basis
1999      2000       Change                        Change   2000       1999
R000      R000       %                             %        R000       R000
719 497   1 051 953  46,2    Revenue               46,2     1 051 953  719 497
596 285   691 925    16,0    Cost of sales         17,4     631 170    537 456
123 212   360 028    192,2   Operating profit      131,1    420 783    182 041
17 908    27 199     51,9    Interest received     51,9     27 199     17 908
(1 980)   (1 591)    (19,6)  Sundry expenditure
                             - net                 (19,6)   (1 591)    (1 980)
                             Profit before tax and 
139 140   385 636    177,2   exceptional items     125,5    446 391    197 969
15 262    -          (100,0) Exceptional items     (100,0)  -          15 262
123 878   385 636    211,3   Profit before tax     144,3    446 391    182 707
(12 138)  148 134            Tax                   43       108        5 469
136 016   237 502    74,6    Profit after tax      127,5    403 283    177 238
151 278   237 502    57,0    Headline earnings     109,5    403 283    192 500
                             Headline earnings 
82,2      116,8      42,1    per share (cents)     89,7     198,4      104,6
73,9      116,8      58,1    Earnings per share
                             (cents)               106,0    198,4      96,3
25        120        380,0   Dividends per share
                             (cents)               380,0    120        25
10        20                 - Interim                      20         10
15        100                - Final                        100        15
Weighted average number of shares in issue - 2000:
  203 283 458 (1999: 184 035 846)
Number of shares in issue - 2000:
  230 147 000 (1999: 184 059 500)

Cash flow
IAS Basis                                                  Appropriation Basis
1999       2000                                            2000       1999
R000       R000                                            R000       R000
151 052    349 460   Cash flow from operating activities   349 460    151 052
123 878    385 636   - Profit before tax                   446 391    182 707
(8 145)    (13 278)  - Change in working capital           (14 559)   (11 672)
(18 403)   (73 638)  - Dividend paid                       (73 638)   (18 403)
55 302     59 474    - Depreciation                        -          -
(1 580)    (8 734)   - Other                               (8 734)    (1 580)
(11 318)   (343 389) Cash utilised in investing activities (343 389)  (11 318)
                     Cash from/(utilised in) 
(19 397)   216 412   financing activities                  216 412    (19 397)
120 337    222 483   Net cash flow                         222 483    120 337
35 605     155 942   Cash at beginning of year             155 942    35 605
155 942    378 425   Cash at end of year                   378 425    155 942

Statement of change in equity
IAS Basis                                                 Appropriation Basis
1999       2000                                           2000       1999
R000       R000                                           R000       R000
1 841      2 301     Share capital                        2 301      1 841
1 840      1 841     - Balance at start of year           1 841      1 840
1 460      -         Issue of new shares                  460        1
2 052 703  2 285 401 Share premium                        2 285 401  2 052 703
2 052 599  2 052 703 - Balance at start of year           2 052 703  2 052 599
104        232 698   - Issue of new shares                232 698    104
(607 742)  (646 416) Retained income/(accumulated loss)   46 146     (80 961)
(714 886)  (607 742) - Balance at start of year           (80 961)   (238 838)
17 140     -         - Transfer from non-distributable
                        reserve                           -          17 140
-          -         - Effect of adoption of AC 130       -          9 511
136 016    237 502   - Net income for the year            403 283    177 238
(46 012)   (276 176) - Dividends distributed              (276 176)  (46 012)
1 446 802  1 641 286                                      2 333 848  1 973 583

Balance sheet
IAS Basis                                                  Appropriation Basis
1999       2000                                            2000       1999
R000       R000                                            R000       R000
2 054 544  2 287 702 Share capital                        2 287 702  2 054 544
(607 742)  (646 416) Retained income/(accumulated loss)   46 146     (80 961)
23 150     -         Long-term liabilities                 -          23 150
6 364      6 835     Long-term provisions                 6 835      6 364
1 476 316  1 648 121                                      2 340 683  2 003 097
901 134    1 185 049 Fixed assets                         2 062 102  1 718 713
271 511    166 485   Deferred tax                         -          -
4 739      5 859     Non current assets                   5 859      4 739
298 932    290 728   Net current assets                   272 722    279 645
19 232     34 859    - Consumable stores                  34 859     19 232
191 182    177 737   - Metals on hand                     159 731    171 895
31 805     70 760    - Accounts receivable                70 760     31 805
155 942    378 425   - Cash and cash equivalents          378 425    155 942
(68 169)   (96 028)  - Accounts payable                   (96 028)   (68 169)
(3 451)    (37 354)  - Tax                                (37 354)   (3 451)
(27 609)   (230 147) - Dividends                          (230 147)  (27 609)
-          (7 524)   - Current portion of long-term
                        liabilities                       (7 524)    -
1 476 316  1 648 121                                      2 340 683  2 003 097

Operating statistics
                                        2000         1999
Square metres mined                     323 274      328 305
Tons milled                             1 660 000    1 800 000
Grade (g/ton - 3PGE + Au)               6,0          6,1
Precious metals in concentrates
produced (3PGEs + Au)             kg    8 372        9 197
                                  oz    269 156      295 695
Precious metals sold (3PGEs + Au) kg    9 331        9 222
                                  oz    299 997      296 501
Average price realised            R/kg  100 701      70 502
                                  $/oz  492          364
Operating cost                    R/kg  70 110       57 170
                                  $/oz  343          295
Cash cost                         R/kg  67 366       56 431
                                  $/oz  329          291
Capital expenditure
* incurred                        R000  343 389      11 318
* authorised                      R000  114 234      -
* committed                       R000  37 965       7 377

Accounting policies
The financial statements have been prepared on the historical cost basis and
incorporate the accounting policies which were adopted in the previous year,
with the exception of the policy adopted in terms of AC 130 (IAS 37) 
Provisions, Contingent Liabilities and Contingent Assets . In line with the
new accounting policy the present value (R5,8 million) of future
decommissioning costs (R31,6 million) was capitalised at 30 June 1998 and a
provision for decommissioning costs was raised for the same amount. The
accrued environmental rehabilitation costs, previously included under
long-term liabilities, were reclassified as a long-term provision and
restated.

IAS Comparatives
The company intends publishing its financial statements with effect from the
2001 financial year in compliance with International Accounting Standards
(IAS) and South African Accounting Standards. Comparative figures have been
included for information purposes.

Comments on results
Financial results
A combination of improved metal prices, particularly palladium and rhodium,
and a weaker rand contributed to a 46% increase in sales revenue. Despite an
increase in cost of sales of 17%, operating profit rose by 131%. An increase
of 52% in interest received, resulting from increased cash holdings, boosted
profit attributable to shareholders to R403,3 million, an incease of 128%.
The final dividend declared of 100 cents per share, which, together with the
interim dividend of 20 cents per share, totals 120 cents per share for the
year, recognises the sound financial position of the company and the
exceptional prices for Platinum Group Metals realised during the second half
of the year. This total dividend is not necessarily indicative of the future
distribution policy.

Operating performance
A reduction in available high grade working face had a negative impact on
production in terms of tons milled and head grade, resulting in lower than
forecast precious metals in concentrates produced. Cash operating costs per
ounce increased, largely as a result of working costs incurred in the
accelerated development programme and the start up of mining of the UG2 Reef.

Capital expenditure
Total capital expenditure for the year ended 30 June 2000 amounted to R343,4
million. Of this, 
R234,6 million was incurred on the acquisition of additional mining areas.
R59,2 million was spent on the UG2 Project and R27,6 million on the
accelerated development programme and infrastructure to mine ore from 13
Level. Expenditure on Year 2000 compliance, a new information technology
system and routine capital amounted to R22,0 million.

UG2 Project
Preparation of underground ore handling facilities and construction of the 75
000 tons per month capacity surface UG2 concentrator plant is proceeding
according to schedule. The concentrator is expected to be operating at full
capacity by February 2001, producing at a rate of 8 000 ounces of 3PGEs + Au
per month. 

Amplats transaction
Shareholders were advised on 3 February 2000 that all the conditions precedent
had been fulfilled, and that the 46,0 million consideration shares had been
issued.

Prospects
It is anticipated that operating costs in both rand per ton milled and rand
per kilogram terms will reduce to below current levels as a result of the
additional production from the UG2 Project coming on stream in February 2001.
Consequently, provided metal prices remain at least at their present levels,
it is anticipated that the financial results for the current year will be
significantly improved. 

Cautionary
Shareholders are referred to the further cautionary announcement which was
published on 27 June 2000, and are advised to continue to exercise caution in
dealing in their Northam shares.

Dividend
Dividend No. 4 of 100 cents per share has been declared in South African
currency, payable to members registered at the close of business on 18 August
2000.
Dividends will be electronically transferred to members' bank or building
society accounts on 6 September 2000, or where this method of payment has not
been mandated, dividend warrants will be posted to members on 5 September
2000.
The standard conditions relating to the payment of dividends are obtainable
from the transfer secretaries, Computershare Services Limited, First Floor,
Edura House, 41 Commissioner Street, Johannesburg, 2001, and the United
Kingdom secretaries, St James's Corporate Services Limited, 6 St James's
Place, London, SW1A 1NP.

On behalf of the Board
A J Wright                              I C Watson
Chairman                                Managing Director

Johannesburg
2 August 2000

Registered address Kenilworth House     PO Box 61525
                   Rutherford Estate    Marshalltown
                   1 Scott Street       2107
                   Waverley 2090        Republic of South Africa
                   Johannesburg
Directors: A J Wright (Chairman), (Alternate D R Wolstenholme), I C Watson
(Managing Director), M E Beckett (British), B E Davison, (Alternate E Ford), A
S Malone, A H Munro, M J Tagg, B R van Rooyen.
Company Secretary: D R Wolstenholme.