Impala Platinum Holdings Limited · JSE:IMP
Impala Platinum — FY2006 Earnings Presentation
22 slides from Impala Platinum's earnings presentation, August 2006
Slide 1: Annual Results 2006 – Key features, financial
Annual Results 2006 Key features - financial Sales revenue up 40% to R17.5 billion (US$2.75 billion) on Heps (cents) 8,000 higher metal prices Operating profit up 73% 6,000 Up 39% Headline earnings per share up 4,000 39% to R60.06 2,000 Final dividend of R22 per share; R87 for the year 0 FY02 FY03 F
Slide 2: Key features – operational and corporate
Key features - operational Safety levels improve to record levels Record production at all operations Impala – 1.125 million ounces refined platinum Zimplats – 90,000 ounces platinum in matte Mimosa – 72,000 ounces platinum in concentrate Marula – 40,000 ounces platinum in concentrate Group platinum
Slide 3: Market review – Sales volumes by metal
Market review Sales volumes by metal FY 2006 FY 2005 % change Platinum (000oz) 1,582 1,562 1 Palladium (000oz) 896 826 8 Rhodium (000oz) 193 177 9 Nickel (000t) 14.8 14.6 1 6 3
Slide 4: Average prices achieved; Metal prices surge
Average prices achieved FY 2006 FY 2005 % change Platinum ($/oz) 988 840 18 Palladium ($/oz) 258 208 24 Rhodium ($/oz) 3,015 1,217 148 Nickel ($/t) 15,343 14,592 5 Exchange rate (R/$) 6.37 6.20 3 7 Metal prices surge Dollar basket revenue per Pt oz received $/Pt oz 2,000 1,600 1,200 800 400 0 FY02 F
Slide 5: Metal prices surge; Platinum fundamentals remain robust
Metal prices surge Rand basket revenue per Pt oz received R/Pt oz 12,000 10,000 8,000 6,000 4,000 2,000 0 FY02 FY03 FY04 FY05 FY06 R per platinum oz up 38% 9 Platinum fundamentals remain robust 000 oz Price ($/oz) 40 0 1,2 0 0 20 0 1,0 0 0 0 8 00 ( 20 0 ) 6 00 ( 40 0 ) 4 00 ( 60 0 ) 2 00 ( 80 0 ) 0
Slide 6: Emission standards (Diesel); Palladium fundamentals improve
Emission standards (Diesel) Particulate matter limits g/km 0.100 JP 97 0.080 0.060 Euro III JP 02 0.040 Tier 1 NLEV Euro IV 0.020 JP 05 Tier 2 Euro V 0.000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 US Federal European Union Japan 11 Palladium fundamentals improve 000 oz Price ($/oz) 1,6
Slide 7: Rhodium demand remains strong; Emission standards
Rhodium demand remains strong 000 oz Price ($/oz) 160 5,000 130 4,000 100 70 3,000 40 2,000 10 1,000 (20) (50) 0 CY99 CY00 CY01 CY02 CY03 CY04 CY05 CY06 (Deficit)/Surplus Rh Price Demand driven by tightening NOx legislation 13 Emission standards g/km NOx limits 0.60 Euro III 0.50 JP 97 0.40 JP 02 0.
Slide 8: Financial review – Group income statement
Financial review Group income statement Rm FY2006 FY2005 % change Sales 17,500 12,541 40 Cost of sales (10,185) (8,318) (22) Gross profit 7,315 4,223 73 Profit before tax 7,001 6,334 11 Tax (2,616) (1,080) (142) Net profit 4,345 5,238 (17) Headline earnings (R/share) 60.06 43.25 39 16 8
Slide 9: Profit by entity; Cash flows
Profit by entity Rm 5,000 117 596 249 109 1,209 3,949 4,000 Up 38% 3,000 2,861 2,000 1,000 0 Headline Impala IRS Zimbabwe Marula Other Headline earnings Platinum operations Platinum earnings FY2005 FY2006 17 Cash flows Cash at end of period Rm 5,000 4,000 3,000 2,000 1,000 0 FY02 FY03 FY04 FY05 FY06
Slide 10: Group capex
Group capex Significant capital expenditure planned Rm - in excess of R13 billion over next five years 3,500 3,000 2,500 2,000 1,500 1,000 500 0 FY06 FY07 FY08 FY09 FY10 FY11 Maintenance Expansion 19 Operational review 10
Slide 11: Safety
Safety Fatal injury frequency rate (per million man hours) 0.16 0.20 0.14 0.16 0.12 0.1 0.12 0.08 0.06 0.08 0.04 0.04 0.02 0 0.00 FY02 FY03 FY04 FY05 FY06 s ds an d PB o ta da at ol nt tr a el ic an pl H G Ti Fi er B Im Xs or o io m d gl N R ol A An G lo ng A 21 Safety Lost-time injury frequency rat
Slide 12: Group tonnes milled; Group refined platinum production
Group tonnes milled 000t FY2006 FY2005 % change Impala 16,441 15,778 4 Marula 971 766 27 Mimosa 1,532 1,424 8 Zimplats 2,019 2,058 (2) Group* 20,197 19,315 5 * Group includes 50% of Mimosa 23 Group refined platinum production 000 oz FY2006 FY2005 % change Impala 1,125 1,115 1 Marula 37 31 19 Mimosa
Slide 13: Group cost per platinum ounce; Operating margins
Group cost per platinum ounce R/oz FY2006 FY2005 % change Impala* (Refined) 4,604 4,227 (8.9) Marula (In concentrate) 9,443 9,829 3.9 Mimosa (In concentrate) 5,133 5,472 6.2 Zimplats (In matte) 6,458 6,249 (3.3) Group* (Refined) 4,912 4,520 (8.7) * Excludes share based payments 25 Operating margins
Slide 14: Impala
Impala 27 Impala Safety challenging Record ounces albeit slightly lower than our target Grade below expectations Record overall recoveries of 84.5% New deep level shafts ahead of schedule PMR expansion to 2.3 million ounces platinum underway 28 14
Slide 15: Impala grade; Impala efficiencies
Impala grade Grade declined to 3.8 g/t (4E) due to mix effects from Lower conventional Merensky volumes from 11 & 14 shafts Higher volume of mechanised and UG2 tonnes Failure to improve dilution parameters Potholing in the opencast operation A task team is addressing these issues 29 Impala efficienc
Slide 16: Marula
Marula 31 Marula Tonnes Tonnes milled per month 000 Exceptional safety performance 120 (LTIFR improved by 42%) 100 Platinum production up 34% to 40,000 80 ounces 60 Interim mining approaching steady Jan 06 Feb 06 Mar 06 Apr 06 May 06 Jun 06 state of 130,000 ROM/tpm Tonnes 000 Production build-up 4E
Slide 17: Zimplats
Zimplats 33 Zimplats Excellent safety performance Steady operational performance – record platinum production 4E grade improved from 3.22 to 3.37 g/t Portal 2 underground expansion project completed on time and under budget Secured resource for long-term expansion to 1 million platinum ounces per an
Slide 18: Zimplats expansion; Mimosa
Zimplats Phase 1 expansion to 160,000 ounces of platinum with capex of US$258 million approved - 2 new underground mines New 1.5 million tonnes per annum concentrator 715 new staff houses and infrastructure 1,200 new direct jobs 3,000 contractor jobs 35 Mimosa 36 18
Slide 19: Mimosa; Two Rivers
Mimosa LTIFR of 1.40 which is amongst best in Group Outstanding operational performance – record platinum production of 72,200 ounces in concentrate Expansion project to 85,000 ounces of platinum per annum complete on time and under budget Study underway to expand to 100,000 ounces of platinum 37 Tw
Slide 20: Two Rivers; Implats operational scorecard
Two Rivers Production ramp up Plant commissioning has 000 oz commenced 160 Ramp up to full production of 120 120,000 ounces of platinum in 80 concentrate scheduled for FY2008 Current stockpile of 1 million tonnes 40 facilitates rapid build-up to full 0 FY07 FY08 production 39 Implats operational sco
Slide 21: Corporate issues
Corporate issues Corporate issues Conversion of mineral rights and BEE Applications submitted to DME Impala – to be finalized Marula – 22.5% in place (satisfies 2009 target) Conclusion of indigenization/empowerment details in Zimbabwe Royalty bill 8:1 share split subject to shareholder approval 42 2
Slide 22: Prospects / Conclusion
Prospects / Conclusion Fundamentals for PGMs remain 000 oz Implats' Platinum Production solid going forward 2500 2000 Growth to 2.3 million ounces still 1500 on track for FY2010 1000 Changing of the guard 500 0 FY01 FY06 FY11 Impala Lease Area Zimbabwe Eastern Limb IRS Other 43 Annual Results 2006 2
Impala Platinum Holdings — FY2006 Earnings Presentation on 6ix