EASTERN PLATINUM LIMITED REPORTS RECORD ANNUAL FULL YEAR REVENUE FOR 2023, ANNOUNCES RESTATEMENT OF COMPARATIVES, AND PROVIDES ITS TARGETS FOR 2024
- Revenue for Q4 2023 increased to
$30.5 million (Restated Q4 2022 -$12.4 million ), representing a 146.0% increase. Revenue for FY2023 increased to$106.9 million , a record full year high (Restated FY2022 -$53.9 million ), representing a 98.3% increase. - Mine operating income increased by
$9.6 million to$7.8 million in Q4 2023 (Restated Q4 2022 mine operating loss --$1.8 million ), resulting in a gross margin of 25.5% in Q4 2023 as compared to -14.5% in Restated Q4 2022. Mine operating income in FY2023 increased by$24.0 million to$31.6 million (Restated FY2022 -$7.6 million ), resulting in a gross margin of 29.5% in FY2023 as compared to 14.2% in Restated FY2022. - Operating income was
$2.8 million in Q4 2023 compared to an operating loss of -$4.8 million in Restated Q4 2022. Operating income increased by$23.2 million to$18.5 million in FY2023 from an operating loss of -$4.7 million in Restated FY2022, a 493.6% increase in operating income. - Net income attributable to shareholders was
$3.3 million ($0.02 earnings per share) in Q4 2023 versus$1.4 million ($0.01 earnings per share) in Restated Q4 2022. The increase in net income was largely attributable to the significant increase in third-party chrome concentrate sales in the period offset by pre-production costs of$2.1 million as the Company initiated the restart of the Zandfontein underground section at theCrocodile River Mine ("CRM"). The Restated Q4 2022 net income was attributable to a restated operating loss offset by other income of$6.6 million , which was mainly related to the change in value of the Company's loans payable. - Net income attributable to shareholders increased to
$13.8 million ($0.08 earnings per share) in FY2023 compared to a net loss attributable to shareholders of -$0.9 million ($0.01 loss per share) in Restated FY2022. The increase in income during FY2023 is mainly attributable to the increased revenue and gross margins generated by remining and processing the Company's tailings resources at the CRM to produce chrome concentrate and platinum group metals ("PGM") concentrate, respectively, offset by pre-production costs incurred in Q4 2023 as described in the previous point. The Restated FY2022 net loss was attributable to an operating loss offset by other income of$7.9 million , which mainly related to the change in value of the Company's loans payable. - The Company had a working capital deficit (current assets less current liabilities) of
$15.5 million as atDecember 31, 2023 (RestatedDecember 31, 2022 – working capital deficit of$37.8 million ) and short-term cash resources of$21.3 million (consisting of cash, cash equivalents, and short-term investments)(RestatedDecember 31, 2022 -$2.4 million ).
Prior Year Error - Restatement of Comparatives
Certain 2022 comparative numbers in the FY2023 Audited Consolidated Financial Statements and corresponding Management's Discussion and Analysis have been restated to correct an error in the Fiscal 2022 consolidated financial statements that was identified subsequent to the 2022 year-end and is discussed below.
In connection with the preparation of the Company's consolidated financial statements for the year ended
The following table presents the effects of the restatement on the individual line items within the Company's Consolidated Statement of Income (Loss), Statement of Comprehensive Income (Loss) and Statement of Financial Position, expressed in thousands of
|
Year Ended |
||
|
As previously |
Adjustment |
As restated |
|
$ |
$ |
$ |
Revenue |
49,834 |
4,049 |
53,883 |
Production costs |
(39,739) |
(2,339) |
(42,078) |
Mine operating income |
5,930 |
1,710 |
7,640 |
Operating income (loss) |
(6,453) |
1,710 |
(4,743) |
Net income (loss) for the year |
(2,504) |
1,710 |
(794) |
Net (loss) attributable to equity |
(2,648) |
1,710 |
(938) |
Earnings (loss) per share, basic |
(0.02) |
0.01 |
(0.01) |
Comprehensive income (loss) for |
(8,947) |
1,766 |
(7,181) |
|
As at |
||
|
As previously |
Adjustment |
As restated |
|
$ |
$ |
$ |
Inventories (current) |
11,320 |
(2,418) |
8,902 |
Deferred revenue (current) |
17,300 |
(4,184) |
13,116 |
The Restated Q1 2023 comparatives will be presented in the interim consolidated financial statements for the three months ended
The consolidated financial statements and related financial information for the affected period contained in the Company's filings filed prior to
Operations
The Company generated revenue from processing PGM and chrome concentrates during Q4 2023 and FY2023. Eastplats' majority of revenue (approximately 96% and 95% for Q4 2023 and FY2023, respectively) is from chrome concentrate sales. Until July of 2022, this revenue was based on the Union Goal offtake agreement (the "Union Goal Offtake Agreement") entered into between the Company's subsidiary
Additional non-cash deferred revenue was recognized based on tons made available for processing from the discounting of the chrome equipment debt and the construction loan based on an effective discount rate. Although the Union Goal Offtake Agreement remains in place, Union Goal stopped taking shipments of chrome concentrate in
Summary of chrome production for the three months and year ended
|
Q4 2023 |
Q4 2022 |
FY2023 |
FY2022 |
Total Tailings Feed (Tons) |
480,777 |
655,011 |
2,247,705 |
2,548,785 |
Average grade Cr concentrate |
38.7 % |
38.6 % |
38.7 % |
38.7 % |
Tons of Cr concentrate |
109,056 |
156,738 |
486,166 |
602,111 |
Summary of PGM production for the three months and year ended
|
Q4 2023 |
Q4 2022 |
FY2023 |
FY2022 |
Tons of PGM concentrate(dry) |
900 |
1,337 |
3,869 |
5,616 |
PGM ounces produced (6E)* |
1,366 |
2,232 |
6,660 |
8,742 |
*PGM 6E ounces are estimates until final exchanges and umpire results have been concluded, which can take up to three months.
Outlook
The Company's targets for 2024 are as follows:
- Resolve the outstanding receivables and related matters with Union Goal (ongoing);
- Ramp-up the Zandfontein underground operations (ongoing);
- Confirm capital plans to support the full re-opening of Zandfontein underground operations at the CRM from external or internal sources (ongoing);
- Complete the second phase of the TSF capital works program and confirm the TSF dam space for new ROM tailings (ongoing);
- Optimize Main
Plant Circuit B for underground operations (initiated); - Renovate Circuit D to high energy flotation cells for better ROM processing recovery rate to 82% or higher (initiated);
- Advance the Mareesburg and Spitzkop project environmental work to complete the Environmental Impact Assessment ("EIA") and other environmental studies and amendments (ongoing); and
- Continue prospecting and assessment work in relation to Zandfontein, Crocette and Kareespruit sections of the CRM and Kennedy's Vale and Spitzkop mines at the eastern limb of the
Bushveld Complex (ongoing).
Eastplats completed a life-of-mine study and underground mine design for Zandfontein in 2022 and the Board of Directors supported carrying out the Zandfontein underground restart business plan, subject to final evaluation and funding arrangements. During 2024, the Company is focusing on ramping up operations at the Zandfontein underground, subject to capital availability and profitability of its chrome operations. If successful, PGM production is expected to increase in 2024. There are no other expected changes to the business in 2024.
Care and maintenance will continue for the Company's previously developed eastern limb projects for 2024. The Company is actively looking at opportunities for its other assets including continuing to explore options to utilize or monetize these assets.
The Company has a primary listing on the
The Company has filed the following documents, under the Company's profile on SEDAR+ at www.sedarplus.ca:
- Audited Consolidated Financial Statements for the fiscal year ended
December 31, 2023 ; - Management's Discussion and Analysis for the fiscal year ended
December 31, 2023 ; and - Annual Information Form at
December 31, 2023 .
The audited consolidated financial statements for the fiscal year ended
https://senspdf.jse.co.za/documents/2023/JSE/ISSE/EPS/FY23.pdf.
Eastplats owns directly and indirectly a number of PGM and chrome assets in the
Operations at the
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.sedarplus.ca.
In particular, this press release contains, without limitation, forward-looking statements pertaining to: the length of operations of the
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.sedarplus.ca. 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.
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