Sterling Performance for Northam, says Chairman Sexwale

Company shrugs off the effects of surging SA currency

Strong operational performance at SA’s premier platinum empowerment player

Northam Platinum today reported a 64% rise in headline earnings to R207 million for the six month period ended December 2002 (December 2001: R127 million), shrugging off the effects of a stronger rand.

This result was achieved on the back of a 706 kg (22 700 ounces) hike in sales volumes which, in turn, contributed to a 28% increase in turnover to R854 million. With this excellent performance, the board has declared an interim dividend of 90 cents to shareholders, some 29% higher than in the previous corresponding reporting period.

Metals in concentrate (3PGEs + Au) produced for the six months ended December 2002 amounted to 5205 kg (167 348 ounces), an increase of 35% over the 3867 kg reported in December 2001. When stripping out the effect of the strike in the previous financial year, this result still demonstrates an excellent performance, meeting internal production targets and reflecting the increased mining flexibility. This is illustrated by the Merensky ore reserve position having improved by 50% from an availability of 12 months in December 2001 to 18 months in the current reporting period. All indications are there that the Merensky ore reserve position is on track to meet the target of 24 months in November this year. The UG2 ore reserves are also progressing according to plan.

Commenting on the results, Chairman Tokyo Sexwale said today, “This has been a sterling performance for Northam. Apart from making a remarkable recovery after the crippling strike in the previous financial year, there has been further consolidation in the area of safety, as evidenced by the achievement of 2 million fatality-free shifts in September last year.”

General Manager Glyn Lewis added, “Higher production and sales volumes went a long way towards offsetting the effects of the stronger rand. In US dollar terms metal prices were mixed over the period, marked by significant declines in the prices of palladium and rhodium on the one hand, and on the other by a sharply rising platinum price. The net effect of this was that the average metal price realised was only 7% higher, at R158 289/kg.”

Cost of sales were higher In line with the higher production and sales volumes. Unit cash costs were 8% lower, however, declining from US$318/oz to US$292/oz, reflecting the effects of the stringent cost control programme.

Looking forward, Sexwale noted that these very good results would add to Northam’s continued ability to deliver value to shareholders.