“We believe that 51% equity just does not work,” David Brown said on a conference call with journalists after the group unveiled full- year results that showed headline earnings per share had soared over 40% on higher prices.
“What they are doing is very bad for the country . . . and has the potential to retard investment,” he said in comments that were unusually blunt for a company official on the issue. He also said the company wanted to see the law changed.
Implats says Zimbabwe’s economic fortunes are tied to the inclusive government finding a political solution to the challenges affecting the country.
The company, which holds an 87% stake in Zimbabwe Platinum Mines Limited (Zimplats) and is in a 50-50 joint venture in Mimmosa, notes that mining is a long-term industry, hence the need to create a vibrant environment that attracts larger capital, but ensure sustainability and social relevance.
The platinum producing firm has invested US$700 million at Zimplats in assets with an additional US$97 million going to staff employment costs. At least US$190 million has so far been remitted to government in the form of taxes.
“Zimbabwe’s economic future remains very much linked to a speedy resolution of the political challenges facing the country. “Political uncertainty together with the unresolved indigenisation and economic empowerment policies, have resulted in many potential investors adopting a wait-and- see attitude with regards to investment in the country,” Brown said.
“Zimplats remains committed to implementing its Ngezi Phase II Expansion project on the basis that the government will honour its commitments as enshrined in the agreements signed in 2006 and earlier.”
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Implats has a huge stake in the outcome of the situation as its Zimbabwe unit, Zimplats, accounts for close to 10% of group production.Brown also said the group’s platinum output for the 2012 financial year would likely decline to 1,7 million ounces from just over 1,83 million in the past year as old infrastructure becomes less productive.
But as new shafts ramp up, the company is aiming for two million ounces by 2014. In its financial results for the full year ended June 2011, Zimplats after tax profit surged to US$200 million from US$122 million the previous year. The period under review marked the first year of full production following the commissioning of Phase 1 expansion in the 2010 financial year.
The platinum miner recorded a 3% increase in tonnes milled, coupled with good grade control and improved concentrator recoveries that resulted in platinum in matte production improving by 5% to 182 100 ounces.
— Our Staff/Reuters.
