Aquarius slumps into loss

The group's attributable half-year production slipped 14 per cent to 215, 453 ounces, due to the previously announced increase in safety stoppages imposed by the South African regulator. These were compounded by underground mining support issues at the Kroondal and Marikana sites, and by significant cost escalations across the South African operations.

Below budget production and poor control of grade (concentration of metal in ore) and costs have forced Aquarius to review its "untenable" contract mining arrangements, which it expects to change or replace by end-March. Production at the Everest site further suffered from industrial relations problems, too, while operations at Blue Ridge remained suspended throughout the period. Regulatory risks have also escalated in Zimbabwe, where the Mimosa mine is facing higher royalties and rents.

The average platinum price remained stable while lower output pushed up South African cash costs by 38 per cent. However, the biggest hit to profits was the $91.3m (£58m) foreign exchange loss from the revaluation of intra-group loans. Net operating cash flow decreased 53 per cent to $25m, which forced Aquarius to fund acquisitions and growth capital from cash resources.