Northam Platinum said in a statement on Monday that its R6.6 billion black economic empowerment (BEE) equity transaction was the single most important development for the company in the financial year ended 30 June 2015.
The BEE transaction, which has been secured for the next 10 years has increased the company’s empowerment levels to 35.4% and has ensured that Northam exceeds the minimum Mining Charter equity requirements, and is well-positioned in the sector as a potential HDSA partner for further transactions.
The BEE transaction saw Northam having to incur certain once-off charges during the year, including a “share based payment” charge in terms of International Financial Reporting Standards 2. In combination, these expenses have had an impact on the income statement, resulting in the company anticipating reporting a net loss for the period under review.
As a result of this the group has recorded a loss of between 264.06 cents per share and 265.54 cents per share, compared to the earnings of 2.4 cents per share reported for the year ended 30 June 2014, reflecting a decrease of between 11 103% and 11 123%, respectively.
Northam also expects to record an estimated group headline loss per share for the year of between 202.7 cents per share and 203.1 cents per share, compared to the headline earnings of 2.2 cents per share reported for the year ended 30 June 2014, reflecting a decrease of between 9 313% and 9 333%, respectively.
The BEE Transaction also included a R400 million once-off lock-in and restraint payment for Northam’s BEE partners, represented by Zambezi Platinum, in respect of the 10 year BEE period. The Lock-in and Restraint Payment is a non-recurring expense and will also be fully accounted for in the group’s results for the year ended 30 June 2015.
Other sundry nonrecurring BEE transaction implementation costs and impairments of noncore assets would also be accounted for in the group’s results for the financial year.
The weighted average number of shares in issue for the year ended 30 June 2015 increased to 391 834 708, compared to 390 969 652 shares for the year ended 30 June 2014. As part of the BEE transaction, Northam issued 112 195 122 additional shares resulting in 509 781 212 shares in issue at 30 June 2015.
Of these shares, 159 905 453 are treasury shares which are not accounted for in the above loss and headline loss per share calculation.
Northam said that the anticipated loss is not a reflection of the performance of the group’s operating assets, all of which performed satisfactorily during the year.
The Booysendal mine is continuing to ramp up to full production and has contributed positively to the group’s results for the period under review.