Impala Platinum Holdings Limited · JSE:IMP
Impala Platinum — H1 2007 Earnings Presentation
21 slides from Impala Platinum's earnings presentation, Feb 15, 2007
Slide 1: Interim Results
Interim Results 15 February 2007 Key features - financial • Sales revenue up 88% to R14.9 billion cps HEPS (US$2.1 billion) 900 • Gross profit up 112% primarily on higher metal prices 600 H2 • Headline earnings per share up 135% to R8.24 per share 300 H1 H1 • Interim dividend of R2.75 per share 0 •
Slide 2: Key features - operational and corporate
Key features - operational • LTIFR improved by 4% Gross refined platinum oz production • Gross platinum production rose by 1,100,000 8.5% to 1.018 million ounces 1,000,000 • Group gross margin at 47% 900,000 800,000 • Group unit costs up 20% due to lower 700,000 production at Impala Lease 600,000 •
Slide 3: Financial review: Group income statement
Financial review Group income statement R million H1 2007 H1 2006 % change FY2006 Sales 14,860 7,920 88 17,500 Cost of sales (7,869) (4,615) (71) (10,185) Gross profit 6,991 3,305 112 7,315 Profit before tax 6,269 2,769 126 7,001 Tax (1,876) (943) (99) 2,616 Net profit 4,347 1,815 140 4,345 HEPS (cp
Slide 4: Headline profit by entity and group cash flows
Headline profit by entity Rm 5,000 158 4,347 413 94 4,000 261 1,579 Up 136% 3,000 1,842 2,000 1,000 0 H1 FY06 Impala IRS Zimbabwe Marula Other H1 FY07 7 Group cash flows Cash at end of period Rm 5,000 4,000 3,000 2,000 1,000 0 Dec 2005 June 2006 Dec 2006 8 4
Slide 5: Group capital expenditure
Group capital expenditure • Capex in excess of R13 billion planned over next five years Rm 3,500 3,000 2,500 2,000 1,500 1,000 500 0 FY06 FY07 FY08 FY09 FY10 FY11 Maintenance Expansion 9 Market review 5
Slide 6: Sales volumes and prices achieved by metal
Sales volumes by metal H1 2007 H1 2006 % change FY2006 Platinum (000oz) 909 833 9 1,582 Palladium (000oz) 422 440 (4) 896 Rhodium (000oz) 108 93 16 193 Nickel (000t) 8.6 6.7 28 14.8 11 Prices achieved by major metals H1 2007 H1 2006 % change FY2006 Platinum ($/oz) 1,164 911 28 988 Palladium ($/oz) 3
Slide 7: Contribution to sales revenue and basket revenue per ounce
Contribution to sales revenue by metal H1 FY06 H1 FY07 5% 6% 8% 12% 17% 51% 62% 24% 8% 7% Platinum Palladium Rhodium Nickel Other 13 Basket revenue per platinum ounce R/Pt oz $/Pt oz 18,000 2,400 2,200 16,000 2,000 14,000 1,800 1,600 12,000 1,400 10,000 1,200 1,000 8,000 800 6,000 600 FY03 FY04 FY05
Slide 8: Platinum and platinum supply and demand
Platinum • Diesel autocatalyst growth continues to drive demand • Increasing diesel share of European light duty vehicles • Growing demand for particulate filters • Stricter emission legislation encompassing heavy duty vehicles • Industrial demand remains robust • Price sensitive jewellery sector de
Slide 9: Palladium and palladium supply and demand
Palladium • Autocatalyst demand grew further • Tighter emission legislation in countries outside North America, Europe and Japan • Growth in vehicle sales • Jewellery demand fell • Inventory draw-down • Increased recycling 17 Palladium supply and demand 000 oz Price ($/oz) 400 1500 1200 300 900 200
Slide 10: Rhodium supply and demand
Rhodium supply and demand 000 oz Price ($/oz) 5000 100 4000 70 3000 40 2000 10 (20) 1000 (50) 0 CY03 CY04 CY05 CY06 CY07 (Deficit)/Surplus Rh Price Forecast 19 Group operational review 10
Slide 11: Safety and tonnes milled
Safety Fatality Frequency Rate Lost Time Injury Frequency Rate 6.00 5.65 0.150 0.139 0.128 4.80 (per million man hours) (per million man hours) 0.104 4.00 0.100 3.57 3.41 3.26 0.069 0.063 0.050 2.00 0.000 0.00 FY03 FY04 FY05 FY06 H1 FY07 FY03 FY04 FY05 FY06 H1 FY07 21 Tonnes milled 000 t H1 2007 H1
Slide 12: Refined platinum production and cost per ounce
Refined platinum production 000 oz H1 2007 H1 2006 % change FY2006 Impala 545 591 (8) 1,125 Marula 29 18 62 37 Mimosa 37 35 6 66 Zimplats 46 45 3 89 Other IRS 361 249 45 529 Group 1,018 938 9 1,846 23 Cost per platinum ounce R/oz H1 2007 H1 2006 % change FY 2006 Impala* (Refined) 5,369 4,398 (22) 4,
Slide 13: Operating margins
Operating margins % H1 2007 H1 2006 % change FY2006 Impala 63 50 26 53 Zimplats 53 34 55 42 Mimosa 73 49 50 53 Marula 47 (1) - 19 IRS 11 15 (29) 14 Group 47 42 13 42 25 Impala 26 13
Slide 14: Impala
Impala • Fatality rate deteriorated • LTIFR improved marginally • Grade marginally up at 3.82 g/t (4.67 g/t 6PGE) • Recoveries down 1.8% on lower Merensky volumes and grade • Refined platinum down 7.8% at 545,000 ounces 27 Platinum production comparison 000 oz 600 580 20 Reclaim 5 Recoveries 560 15
Slide 15: Solutions and timeframes
Solutions and timeframes • 11 Shaft People and logistics End March 2007 • 12 Shaft Panel re-establishment June 2008 • 14 Shaft Partial mine layout redevelopment End March 2007 • Additional issues In-stope roof bolting DDT’s Skills shortage 29 Marula 30 15
Slide 16: Marula
Marula • Excellent safety performance • Ramp-up to full production on schedule • Tonnes milled 60% higher at 739,000 • Grade 2% higher at 4.06 g/t (6PGE) • Platinum production in concentrate up 76% to 33,200 ounces • Unit cost per platinum ounce 12% lower mainly due to higher volumes • Conversion to
Slide 17: Zimplats
Zimplats • Excellent safety performance • Platinum production in matte up 6% at 46,100 ounces • Unit cost per platinum ounce increased by 4% to R7,050/oz • Portal 2 underground mine at full production and completed well under budget • Pebble crusher has been commissioned and throughput increased • P
Slide 18: Mimosa
Mimosa • Safety disappointing • Tonnes milled up 9% • Platinum production up 5% at 38,400 ounces • Unit costs per platinum ounce increased by 4% to R4,919/oz • Phase V expansion to 100,000 ounces of platinum per annum commenced 35 Two Rivers 36 18
Slide 19: Two Rivers
Two Rivers • Plant fully operational after initial commissioning problems • Produced 31,000 ounces of platinum in concentrate in first six months • Ramp-up to full underground production back on track following industrial action 37 Corporate issues 19
Slide 20: Corporate issues
Corporate issues • RBN royalty transaction replaced IRS transaction • Shareholder approval received • Awaiting promulgation of the Amendment to Income Tax Act • Approval by Minister of Land Affairs outstanding • Applications for conversion of mineral rights remain work in progress 39 Prospects 20
Slide 21: Prospects
Prospects • Robust PGM market • Increase in production to 2.3 million platinum ounces by FY2010 on track • Smelter expansion to support 2.8 million ounces • Significant further upside potential in Zimbabwe • Safety, volumes and grade management remain operational priorities • Highly cash generative
Impala Platinum Holdings — H1 2007 Earnings Presentation on 6ix