Jubilee Platinum's revenues and profits grow in first quarter

Jubilee Platinum said unaudited revenue in the first three months of the year was 32 per cent higher than the previous quarter as the company achieved growing rates of power sales.

Revenue from smelting and refining operations came to 16.4m South African Rand (ZAR) while unaudited gross profit also jumped by 47% quarter-on-quarter to 11.2m ZAR.

Profits were boosted by increasing third party sales of electricity, generated from its power plant.

Chief Executive Officer, Leon Coetzer, said increased processing rates, a rise in rates of power sales and the creation of a platinum, exploration, mining, processing and smelting and refining business were the key drivers for growth.

"Jubilee continues to drive growth in its operations despite the challenging trading conditions. During the first quarter Jubilee has taken significant strides towards implementing its mine-to-metals strategy," he said.

During the period, the group increased its interest in Power Alt, the owners of the Middelburg Smelting Refinery, to 70% in February 2013.

Power Alt secured the issuance and grant of all applicable regulatory consents and electricity generation licences for selling 10 megawatts (MW) of power to the national electricity public utility, an increase from the 5MW currently contracted to the utility. The extension to the contract is valued at 98m ZAR.

Coetzer said the firm was able to improve revenues from its Middelburg operation from non platinum bearing material.

"The processing of non-platinum bearing material remains peripheral to Jubilee's larger platinum focus and has been used as a leverage to install platinum processing capacity in the Eastern Limb of South Africa's Bushveld Igneous Complex," he said.

The group also updated shareholders on its proposed acquisition of Platinum Australia (PLA). It has entered into an implementation deed and supporting transactional documents with PLA in relation to the acquisition of the entire issued capital.

The acquisition will give Jubilee access to PLA's PhokaThaba Platinum Mine in South Africa.

Jubilee expects the addition of PLA's mining and processing assets to help the company become one of the lowest cost producers of platinum concentrates.

Shares rose 3.64% to 7.12p at 11:05 Wednesday.

RD