Zimplat's operating costs went up 36%, underlining the pressure the company has been under, after the Zimbabwe Revenue Authority alleged it had skipped $34m in tax payments last year.
HARARE(BullionStreet): Amidst pressure from Zimbabwe government, Zimplats, Impala Platinum’s Zimbabwean unit posted a 26% increase in operating profit for the first quarter of the year.
Zimplats,in its quarterly report said the company recorded an operating profit of $65m for the three months ended March 31. Revenue for the period under review was also 32% higher.
Zimbabwe government asked Impala to to hand over 28,000ha of its platinum land. Zimbabwe indigenisation ministry said it is going ahead with the takeover of the land as gazetted in a Government Gazette.
The acquisition of the land follows a $900m indigenisation deal signed by Zimplats, in compliance with the 51% indigenisation law.
Zimplats’ operating costs went up 36%, underlining the pressure the company has been under, after the Zimbabwe Revenue Authority alleged it had skipped $34m in tax payments last year.
The company notified shareholders that it had lodged an appeal with the Special Court for Income Tax against the levying of a $1.5m penalty on the prior year’s tax liabilities.
"High revenue has been driven by higher sales volumes and improved metal prices. Production from mining activities was up 7% from the prior period while it went up 3% from December last year and this was primarily driven by improved equipment availability," reads the report.
"Mining production for the quarter was 3% higher than the previous quarter, driven primarily by an improvement in underground equipment availability, but the head grade was 1% below plan due to the milling of lower grade ore from Mupfuti Mine, which is still under development, as part of the Ngezi phase 2 expansion," it said.
Meanwhile, Zimplats said the construction and commissioning of the Ngezi phase 2 expansion project was under way and had continued as planned during the first quarter.
The Ngezi mine expansion has been undertaken at a cost of $460m and will increase platinum production by 90,000oz — to 270,000oz a year — by the start of next year.