Sylvania achieves record FY17 PGM output

JOHANNESBURG (miningweekly.com) – Aim-listed Sylvania Platinum has achieved a new yearly production record after another strong quarter pushed output from the Sylvania Dump Operations (SDO) beyond the upper end of the revised 65 000 oz guidance for 2017 to 70 869 oz.

The low-cost platinum-group metal (PGM) processor and developer highlighted that it had consistently achieved strong production over the course of the year, with 17 954 oz produced in the fourth quarter, a 5% increase on the previous quarter and the second highest quarterly production achieved by the company.

Overall, the SDO continued to perform well and delivered better-than-forecast results, the company said in its fourth quarter report on Monday.

“From a production perspective, I am confident we will see the fruits of our labour as the production profile is supplemented and offsets potential losses as a result of the planned closure of the Steelpoort plant. The acquisition of Phoenix [Platinum] will further strengthen Sylvania's position in tailings retreatment,” Sylvania CEO Terry McConnachie noted.

Sylvania announced on Monday that it would acquire Phoenix Platinum from Pan African Resources for about R89-million.

Meanwhile, during the fourth quarter to June 30, the cash costs for the SDO in dollar and rand terms decreased 10% and 11% respectively from $471/oz and R6 236/oz in the third quarter to $422/oz and R5 572/oz, owing to a combination of higher PGM ounce production and disciplined cost control during the period.

“In a market where the gross basket price has not moved significantly for some time, our measures of prudent cost controls and focus on ounce production is paying off and is further evidenced by these strong results,” he explained.

During the quarter under review, revenue increased 4% quarter-on-quarter in dollar terms to $13.2-million and 3% in rand terms to R174.4-million.

Group earnings before interest, taxes, depreciation and amortisation improved 22% from $4.1-million to $5-million quarter-on-quarter.

Sylvania’s group cash balance at June 30 was $15.3-million, a $1.3-million decrease on the previous quarter owing to a net decrease in working capital amounting to $1.4-million; a further $1.4-million spent on stay-in-business capital for the SDO plants; $600 000 in expenditure on exploration assets; $500 000 paid for a rehabilitation insurance guarantee; and $100 000 spent on an investment in a joint venture research and development project.

The company will release its full-year results by August 30.