Vancouver, British Columbia – Eastern Platinum has reported that it has filed its condensed interim consolidated financial statements for the three months ended March 31, 2022 and the corresponding management’s discussion and analysis. Below is a summary of the Company’s financial results for the first quarter of 2022 (“Q1 2022”) (all amounts in USD unless specified) in comparison to the same respective period in 2021 (“Q1 2021”):
- Revenue for Q1 2022 increased to $17.4 million (Q1 2021 – $16.7 million), representing a 4.3% increase. The increase in revenue for Q1 2022 was primarily due to an increase in platinum group metal (“PGM”) sales in the period.
- Mine operating income increased by $2.0 million (or 137.5%) to $3.4 million in Q1 2022 (Q1 2021 – $1.4 million), resulting in an improved gross margin of 19.6% in Q1 2022 from 8.6% in Q1 2021.
- Operating income was $0.1 million in Q1 2022 compared to an operating loss of $1.7 million in Q1 2021.
- The Company had positive working capital (current assets less current liabilities) of $17.2 million as at March 31, 2022 (December 31, 2021 – $14.6 million) and short-term cash resources of $6.6 million (consisting of cash, cash equivalents and short-term investments) (December 31, 2021 – $6.1 million).
The Company continues its Retreatment Project at Barplats Mines (Pty) Limited’s tailings facility
(the “Retreatment Project”) located at the Company’s Crocodile River Mine (“CRM”) in South
The majority of the Company’s revenue (approximately 84% for Q1 2022) is generated from the offtake agreement with Union Goal Offshore Solution Limited (“Union Goal”) in relation to chrome concentrate production from the Retreatment Project. The remaining amount of the Company’s revenue was from PGM concentrate sales to Impala Platinum Limited (“Impala”).
The completion of the reconfiguration and optimization of the small-scale PGM circuit (“PGM Circuit D”) in Q1 2021 continued to successfully utilize the feed, following the recovery of chrome concentrate, to produce PGM concentrate under the respective offtake agreements in Q1 2022.
Refurbishment work commenced on the PGM main plant circuit (“PGM Main Circuit B”) during April 2021 and the circuit was commissioned in October 2021.
PGM Circuit D and PGM Main Circuit B (collectively, the “PGM Circuits”) are both operating and continue to drive revenue growth and gross margin improvement for the Company.
During the period, the Company continued work to close the Maroelabult resource project sale with Eland Platinum (Pty) Limited. Eastplats announced the completion of the sale (see press release of March 22, 2022 for further information). Total cash consideration of R20 million (approximately $1.3 million) was received on March 9, 2022 after the transfer of legal title and various regulatory obligations required in South Africa were completed.
The Company’s targets for 2022 are as follows:
- Optimize the operations of the Retreatment Project and maximize returns (ongoing)
- Completion of the Optimization Program for the Retreatment Project (ongoing);
- Assess the value of the chrome recovery plant after optimization (ongoing);
- Operate and optimize the PGM Circuits (ongoing);
- Capital raise to restart Zandfontein underground operations at the Crocodile River Mine (initiated);
- Completion of the second phase of the tailings storage facility (“TSF”) capital works program (ongoing);
- Mareesburg project environmental work to complete the legal analysis on the Environmental Impact Assessment (“EIA”) and other environmental studies and amendments (ongoing);
- Prospecting and assessment work in relation to Zandfontein, Crocette and Spitzkop ore bodies (ongoing);
- EIA and other assessment work regarding a vertical furnace and pelletizer of chrome concentrate (ongoing); and
- Update other capital assessments upon completion of capital fundraising.
Care and maintenance with respect to the underground portion of the CRM will continue while the Company assesses the Zandfontein underground operations for restart