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Operational and Financial highlights - 2013
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Related Links
2014 Notice of Annual General Meeting
2013 Annual Report & Accounts
2013 Sustainable Development Report
2013 Interim Report
2013 Notice of Annual General Meeting
2012 Annual Report & Accounts
2012 Sustainable Development Report
2012 Rights Issue Prospectus
 

Investor enquiries, please contact:

Tanya Chikanza
+44 (0)20 7201 6007 / +2711 218 8358
tanya.chikanza@lonmin.com



2013 Features

Lost Time Injury Frequency Rate (LTIFR) of 3.50, a 15.9% improvement on previous year, but sadly 3 fatalities

Production ramp up achieved well ahead of Renewal Plan

Highest Marikana underground tonnes hoisted in 6 years (11 million)

751,000 Platinum ounces in concentrate achieved, highest in 6 years and an 10.5% increase on last year

Platinum sales of 696,000 ounces, exceeding guidance of 660,000 ounces; pipeline rebuilt

Immediately available ore reserves at 3.8 million centares, up 14.7%

Concentrator recoveries at record level at 87.0%

Rights Issue of December 2012, raised net proceeds of $767 million

Underlying profit before tax of $158 million ($57 million in 2012)

Net cash of $201 million (net debt of $421 million in 2012)

Cost of production per PGM ounce increase contained to 3.8% - exceeding guidance and lower than South African inflation

Capital expenditure of $159 million (below guidance of $175 million - in line with guidance in Rand terms)

Underlying Earnings per Share of 20.5 cents versus 3.9 cents in prior year (restated for impact of Rights Issue)

 

2014 Priorities

Building a safe and sustainable business
We aim to be the safest primary PGM producer and to minimise our adverse environmental impact – our aim is to cause zero harm to people – by integrating our operational and sustainability strategies.

Protecting the short-term value of the Marikana assets
We have significant amounts of shareholders’ capital tied up in the existing asset base, and mining is generally highly capital intensive. Our expectation is that PGM markets will remain lacklustre in the short-term, but we believe that there will be significant value potential over the longer term. We therefore aim to remain frugal with our cash and optimise limited capital investment in the immediate future but without compromising the potential of the business to reach higher levels of production when market circumstances improve. Our K4 shaft is currently on care and maintenance, but is a crucial asset for when we wish to replace or increase production.

Continuing focus on productivity and cost management
We will maintain a rigorous focus on cost control, in relation to both gross costs and costs per PGM ounce produced. Gross costs are tightly controlled through centralised procurement and unit costs are managed by developing a clear understanding of normal levels of usage relative to production, all of which is supported by strong management information systems and a robust internal control environment to ensure that all costs are properly incurred before payment is made.

Maintaining balance sheet strength
We aim to preserve a conservative balance sheet with access to sufficient funds to finance both ongoing operations and, prudent and efficient capital expenditure.

Maintaining the option of attractive longer term growth opportunities
We have established brownfield growth opportunities in Marikana and Limpopo assets and through our participation in the Pandora joint venture, and a greenfield opportunity through our Akanani assets. In addition, we have a modest resource in the Sudbury Basin in Ontario, Canada which has the potential for a small open pit operation. Further exploration work is being pursued in this part of Canada through three joint ventures. All of the Canadian interests fall within the footprints of old nickel mining activities and would be classed as brownfield opportunities.

Conclusion
Overall, the longer-term fundamentals of the PGM markets remain robust, although we continue to be cautious about the market in the near and medium-term.

We will enhance value for our shareholders by leveraging our established operations and quality assets in the world’s premier PGM deposit through:

  • Embedding our operational credibility and excellence;
  • Rebuilding our employee and stakeholder relationships;
  • Improving utilisation of our infrastructure, especially Saffy and processing;
  • Continued focus on cost control;
  • Cash conservation and funding capital from our operations; and
  • Driving our social and citizenship agenda through partnership.
 

Latest news

31 March, 2014
  1. Directorate Change
05 March, 2014
  1. Update on Protected Strike Action
30 January, 2014
  1. Directorate Change
30 January, 2014
  1. Q1 2014 Production Report
23 January, 2014
  1. Protected Strike Action
21 January, 2014
  1. Joint Statement from Platinum Chief Executives
20 January, 2014
  1. Lonmin receives strike notice from AMCU
27 November, 2013
  1. Directorate Change
11 November, 2013
  1. 2013 Final Results Announcement
11 November, 2013
  1. Q4 2013 Production Report
07 November, 2013
  1. Directorate Change

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