THE country’s largest platinum miner Zimplats would have preferred to list on the Zimbabwe Stock Exchange as opposed to the notional vendor financing model used to comply with the 51% indigenisation requirement, a company official said.
Zimplats CEO Alex Mhembere told analysts on Tuesday, the miner would have preferred a local listing to encourage broad based local participation. He, however, said this would have created problems as the market was also open to offshore investors.
Mhembere said indigenisation was still work in progress but the miner is hopeful an amicable resolution to the process will be found.
According to the Zimplats term sheet, parties committed to co-operate to fulfill the conditions precedent by June 30 2013.
The effective date of the transaction will be the date on which the conditions precedents are fulfilled.
He said local procurement increased to 63% of which 31% was indigenous with the year-to-date value of US$178 million for local suppliers and US$88 million going to indigenous suppliers.
Contrary to allegations that the miner was misrepresenting its output, Mhembere said a daily metal accounting system was in place which tracks the mineral that is mined and recovered at the processing plants every 15 minutes. He also said there was an on-site MMCZ officer monitoring the matte dispatches.
Revenue in the nine months to March was down 4% to US$345,8 million despite an increase in volume. The pre-tax profit was down 27% to US$85 million while cash generated from operations went down 47% to US$97,6 million from US$182,6 million.
Gross margins were down 24%.
Mhembere said all other areas of the business were extremely good, adding the financial numbers do not reflect the good performance on the ground.
Platinum remained the major contributor to revenue at 56,5% followed by palladium at 19,7%, gold 6,6% and nickel at 9,9%.
Mining production for the March quarter was 3% higher than the previous quarter driven primarily by an improvement in underground equipment availability. However, the head grade was 1% below plan due to the milling of lower grade ore from Mupfuti Mine which is still under development.