Zimplats retrenches 1,6pc of workers
Zimplats says in light of the softer global metal pricing environment, the group implemented various cash preservation measures that include labour rationalisation and capital project re-scheduling.
Global mining companies are cutting back on expansion plans following the decline in global prices of the metal that global analysists say might go beyond 2027.
Platinum prices were 7 percent down in the year to April 2024 while palladium was 10 percent lower in the same period.
The country’s largest platinum producer in its quarterly update to March 31, 2024, said in April 2024, 67 employees, being 1,6 percent of total permanent workforce were retrenched.
“Cost containment initiatives implemented in the prior quarter progressed in the period under review, resulting in a 2 percent reduction in total operating cash costs from the prior quarter,” reads the update.
Zimplats said operating cash costs increased by 7 percent year-on-year, primarily due to the 9 percent and 7 percent increase in mining and milling volumes respectively, benefiting from cost mitigation efforts that helped contain the impact of persistent input inflation.
It said transfers from stocks to operating costs amounted to US$2,8 million during the period, in line with the movement in inventory across the value chain.
The group noted that cash costs of metal produced increased by 5 percent and 1 percent from the comparative and prior quarter, respectively.
“Operating cash unit cost of US$821 per 6E ounce was marginally below that of the prior quarter and declined by 6 percent year-on-year, benefiting from volume gains which offset inflationary pressures experienced on electricity,” Zimplats said.
During the quarter under review, mining volumes were unchanged from prior quarter but increased by 9 percent year-on-year benefiting from the pillar reclamation operations at Rukodzi Mine and the continued ramp-up of production from Mupani Mine, which is under development.
The group said pillar reclamation activities also benefited 6E head grade, which was 2 percent higher year-on-year.
“The 1 percent reduction in grade from the prior quarter was due to an increased contribution of lower-grade Mupani Mine development ore and dilution from mining across geological structures,” reads the report.
Milled volumes during the period increased by 7 percent and 3 percent from the comparative and prior quarter, respectively.
The company said a scheduled reline of the mills at the Selous Metallurgical Complex (SMC), was deferred to the fourth quarter of FY2024, the volumes from which also benefited from improved milling rates and running time, in line with higher ore supply.
Zimplats said concentrate recoveries were stable compared to the prior quarter and increased by 5 percent from the comparative quarter, resulting in a 2 percent quarter-on-quarter and 14 percent year-on-year increase in the volume of 6E in concentrate produced.
However, 6E metal in final product improved by 12 percent year-on-year and was 1 percent higher than the prior quarter.
In an update on capital projects which were under execution during the period, Zimplats said the Bimha and Mupani mine development and upgrade projects will replace production from Rukodzi Mine, which was depleted in FY2022 and Ngwarati and Mupfuti mines which will be depleted in FY2025 and FY2028, respectively.
As at March 31, 2024, cumulatively, US$395 million was spent on these projects against a total project budget of US$468 million.
“A total of US$340 million has been spent to date on the smelter expansion and Sulphur Dioxide (SO2) abatement plant against a total project budget of US$521 million,” reads the report.
It noted that US$27 million has been spent on the implementation of the 35 megawatt solar plant project to date, against a budget of US$37 million.
The group said a total of US$27 million has been spent to date on the execution of the Base Metal Refinery refurbishment project, against a total budget of US$190 million.-ebusinessweekly
