Zimplats tax contribution to Govt up 23 percent

PLATINUM giant Zimplats’ tax contribution to Government increased by 23 percent to $16 million in the fourth quarter of last year from $13 million in the previous quarter.

In the report for the quarter ended December 31, 2018, the country’s largest platinum miner said:

“Total direct and indirect tax payments to the Government of Zimbabwe increased to US$16 million from the US$13 million reported in the previous quarter.”

During the period under review, the platinum miner’s revenue also increased by 10 percent from the previous quarter due to an increase in metal prices (gross revenue per 4E ounce increased by 19 percent to US$1 173 from US$985), which was partly offset by a seven percent reduction in volume of 4E metal sold.

Net operating costs decreased by 14 percent compared to the previous quarter mainly due to the decrease in sales volumes and an increase in export incentive.

“Royalty and commission expenses increased by 13 percent from the previous quarter due to the increase in sales revenue (driven mainly by palladium and gold),” said Zimplats.

It said ore mined increased by three percent from the previous quarter mainly due to productivity improvement initiatives implemented during the quarter.

However, production for the quarter decreased by five percent from the same period in 2017 due to the closure of the South Pit Mine in March 2018.

“Tonnes milled decreased by three percent from the previous quarter due to a lower milling rate and a decrease in the running time of the mills due to the planned SMC concentrator mill reline shutdown.

“The 4E head grade improved to 3,24g/t from 3,23g/t in the previous quarter, reflecting consistent grade control at the mines,” said Zimplats.

“Overall, 4E metal production in final product decreased by five percent from the previous quarter, in line with the decrease in the volume of concentrates smelted.

“Concentrates smelted decreased by five percent due to a routine seven-day furnace taphole inspection shutdown.”

The mining company indicated that 4E metal sales for the quarter, at 130 432oz, were seven percent lower than the previous quarter mainly due to a decrease in metal production and some negative adjustments to sales in the pipeline.

Finance and Economic Development Minister Professor Mthuli Ncube is on record as saying the Government will provide fiscal incentives to Zimplats in recognition of its efforts to set up a refinery for base metals and precious stones to promote beneficiation of the minerals.

The $134 million project, which was initially marked to process the metal from Zimplats, now includes Unki and Mimosa mines who joined the platinum giant in financing the establishment of the country’s first base metal refinery.

In this year’s National Budget, Prof Ncube said the Government had postponed a 15 percent tax on the exportation of un-beneficiated platinum to January 1, 2022 taking into account the progress and commitment made by Platinum Group Metals producers towards beneficiation.

Alongside South Africa, the United States of America and Russia, it is hoped that Zimbabwe will be among a few countries in the world to successfully establish a base metal refinery. — @okazunga