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Mining giant spends US$239million on local equipment suppliers

Mining giant spends US$239million on local equipment suppliers

zimplats

Zimbabwe’s most preformation and largest platinum producer, Zimplats Holding Limited spent 56% of equipment supply and consumables on local suppliers as part of its responsibility to empower local communities, the group owners Impala Platinum Holdings Limited (Implats) said.

Anerudo Mapuranga

According to Implats, the company prioritises constructive and beneficial relationships as well as sustainable socio-economic development in mine-host communities.

Implats said Zimplats spent US$239 with Zimbabwe local suppliers while South African companies spent over R4.4 billion.

“In South Africa, the Group spent R126 million on community development initiatives, a further R212 million on the Group’s industry-leading housing development and R719 million on skills development. R3.5 billion was spent with local-tiered suppliers with >25% black ownership and US$239 million (or 56% of discretionary spend) was spent with local suppliers in Zimbabwe. In Canada, supplies to the value of C$39 million were procured from Indigenous communities in the areas of the mine’s operations.” Implats said.

During the financial year ended June 30, 2021, Zimplats spent US$159.1 million on capital projects including stay-in-business, replacement and expansion projects compared to US$104 spent in the previous year.

Revenue for Zimplats increased 56% to US$1.4bn in the period under the review, largely due to the increase in the prevailing average metal prices during the year.

Despite the 2% decline in volumes sold, the cost of sales increased by 14% to US$546.7m primarily due to an increase in revenue indexed expenses resulting from the higher revenue achieved in the year.

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Operating cash cost per 6E ounce increased by 8% to US$661 per ounce from US$613 per ounce in 2020.

The gross profit margin increased to 60% from 45% in 2020 primarily due to higher metal prices while income tax expense increased to US$237.4m on higher profitability.

As a result, profit after tax stood at US$563.1m while net cash generated from operating activities increased to US$453.1m.

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