Impala Platinum Holdings Limited · JSE:IMP
Impala Platinum — H1 FY2004 Earnings Presentation
18 slides from Impala Platinum's earnings presentation, March 2004
Slide 1: Introducing Implats
1 Introducing Implats Implats is in the business of mining, refining and marketing the platinum group metals and associated base metals Implats has extensive operations on the two most significant PGM deposits in the world: • the Bushveld Complex in South Africa and • the Great Dyke in Zimbabwe 2 1
Slide 2: A multi-resource company; Share price performance
A multi-resource company 1999 2004 2% 30% 28% 72% 4% 64% Impala Barplats Impala Marula Zimplats Mimosa 69 Moz Pt 254 Moz Pt 3 Share price performance 200 180 160 140 Indexed to 100 120 100 80 60 Jul-01 Dec-01 Jul-02 Dec-02 Jul-03 Dec-03 MSCI EM Index Implats Anglo Platinum Lonmin Source: UBS, Reuter
Slide 3: Analysis of shareholding; Metals produced
Analysis of shareholding As at end December 2003: 7% 5% South Africa 12% 55% USA England, Scotland and Wales Europe 21% Other countries 45% held offshore (FY2002: 31%) 5 Metals produced 000oz FY2004 FY2003 First half Total PGMs 2 006 3 200 Platinum 1 075* 1 673 Palladium 551 893 Rhodium 132 215 Nick
Slide 4: Key features of the FY2004 interims; Refined platinum production
Key features of the FY2004 interims • Platinum production increases significantly • Rand appreciation causes decline in basket price • Impala unit costs well-contained • Net profit decreases to R1,1 billion • Continued improvement in safety • Sale of Lonplats stake progressing 7 Refined platinum pro
Slide 5: Platinum production; Sales volumes
Platinum production FY2004 FY2003 000oz First half First half Impala Platinum 546 545 Impala Refining Services 529 228 Barplats 16 16 Zimplats 38 35 Mimosa Platinum 26 8 Aquarius Platinum 89 66 Lonplats 206 - Other and toll refining 154 103 Total platinum production 1 075 773 9 Sales volumes FY2004
Slide 6: Metal prices; Revenue received per platinum ounce
Metal prices FY2004 FY2003 % First half First half change Platinum $/oz 707 553 27.8 Palladium 195 312 (37.5) Rhodium 482 757 (36.3) Nickel $/t 9 600 7 057 36.0 $ revenue per Pt oz 997 927 7.6 Exchange rate 7.12 10.09 (29.4) R revenue per Pt oz 7 099 9 353 (24.1) 11 Revenue received per platinum oun
Slide 7: Contribution to revenue by metal; Key ratios and margins
Contribution to revenue by metal Interim FY2003 Interim FY2004 5% 7% 7% 10% 12% 6% 59% 68% 9% 17% Platinum Palladium Rhodium Nickel Other 13 Key ratios and margins FY2004 FY2003 FY2003 First half First half Ratios Return on equity 22 43 37 Return on assets 17 38 30 Margins Gross 31 47 43 Impala leas
Slide 8: Contributions to net profit; Group capex
Contributions to net profit $m FY2004 FY2003 First half First half Impala Platinum Limited 90 153 IRS 28 2 Lonplats 21 36 Mimosa Platinum 11 1 Aquarius Platinum 2 3 Barplats (1) 1 Zimplats* (2) 3 Total 149 199 * Elimination of unearned profit 15 Group capex $m 250 200 150 100 50 0 FY2002 FY2003 FY20
Slide 9: Three-pronged strategy; Impala Platinum
Three-pronged strategy • Mine-to-market Impala Marula Mimosa Zimplats • Impala Refining Services • Strategic alliances and investments Lonplats Aquarius Two Rivers 17 Impala Platinum • Implats primary operating unit – comprises the mining operations on the Impala lease area, Mineral Processes and Re
Slide 10: Marula Platinum
Marula Platinum • 20% BEE participation • Commissioning of surface infrastructure going well • On-reef decline development behind schedule • Target production of 100 000 Pt oz pa 19 Marula Platinum 20 10
Slide 11: Zimplats; Mimosa Platinum
Zimplats • Shareholding - 82% • Current production of 85 000oz Pt per annum • Significant expansion opportunities Potential Pt production (000oz) 400 Phase 3 300 Phase 2 200 Phase 1 100 Current 0 2004 2006 2008 2010 21 Mimosa Platinum • Currently at full production of 65 000 oz Pt per annum • One of
Slide 12: Working in Zimbabwe; Lonplats
Working in Zimbabwe • Working relationship with Government • Approval for foreign currency accounts • Able to import fuel and capital goods • Power - paid for in dollars • Exchange rate issues • Indigenisation programme: • Zimplats – heads of agreement signed with Needgate; funds being raised • Mimo
Slide 13: Platinum price; Platinum supply and demand
Platinum price $/oz R/oz 900 6500 6000 750 5500 5000 600 4500 450 4000 3500 300 3000 Jul-01 Nov-01 Mar-02 Jul-02 Nov-02 Mar-03 Jul-03 Nov-03 $/oz R/oz 25 Platinum supply and demand 000oz 2003 2002 Demand Automobile 2 660 2 615 Jewellery 2 625 2 845 Industrial/investment 1 610 1 670 Total demand 6 89
Slide 14: Overview – platinum market; Palladium price
Overview – platinum market • Price at a 24-year high in US dollars • High and volatile prices impact on jewellery market • Tighter emission legislation and further growth in diesel vehicle sales have supported demand • Growth in RoW vehicle sales becoming a factor • Heightened profile for fuel cell
Slide 15: Palladium supply and demand; Overview – palladium market
Palladium supply and demand 000oz 2003 2002 Demand Automobile 4 240 4 530 Electronics 965 980 Dental 815 770 Other 605 615 Total demand 6 625 6 895 Total supply 7 150 7 140 Net surplus 525 245 29 Overview – palladium market • Fundamentals not supportive of current price levels • High inventory level
Slide 16: Other markets; ADR Programme
Other markets Rhodium • Drop in rhodium price reflects a market that is adequately supplied Nickel • Rapid growth in stainless steel production drives demand • Lack of new capacity in tight market will keep pressure on prices in short to medium term 31 ADR Programme • Level 1 sponsored ADR initiated
Slide 17: Production outlook; Prospects
Production outlook On target for 1.9 million ounces in FY2004 000oz 2,000 1,500 1,000 500 0 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 Impala Growth Lonplats toll refining 33 Prospects • Exchange rate movements have dramatically increased US dollar costs • Similar profitability expected in second half
Slide 18: Disclaimer
Disclaimer This presentation may contain certain forward-looking statements concerning Implats' operations, economic performance and financial condition, and plans and expectations. These statements, including without limitation, those concerning the economic outlook for the platinum group metals (P
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