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- Eastplats, which generates most of its revenue from chrome, has enjoyed a significant increase in chrome prices in its half-year to end-June.
- Profits more than doubled, which comes as the company plans to soon restart mining an underground section of its Crocodile River Mine in the North West.
- Despite higher profits, its shares still slumped on Friday, and an investigation into whistleblower allegations remains ongoing.
- For more financial news, go to the News24 Business front page.
Junior miner Eastern Platinum (Eastplats) has reported a more than doubling of interim profit after receiving a boost from both increased third-party chrome sales as well as higher prices for the metal.
Vancouver-based Eastplats reported on Friday its headline earnings jumped to $9 million (almost R170 million) in the six months to end-June from $3.9 million previously. It was helped by increased sales as well as a climb in metal prices which JSE-listed mining peer Tharisa has said in part stems from SA's energy and rail dysfunction.
Eastplats, valued at about R287 million on the JSE as of Friday's open, has chrome and platinum group metal (PGM) assets in SA, but generates about 94% of its revenue from chrome.
The group, whose primary listing is in Toronto, with a secondary listing on the JSE, is engaged in re-mining and processing of tailings at the Crocodile River Mine in the North West. The miner said it continues to move towards a soft restart of the Zandfontein underground section of the mine, expecting the initial processing of ore to begin later this year.
Revenue increased 55% to $58.7 million (about R1.1 billion) to end-June, the company said, also noting in its report that it is in the process of considering and evaluating its rights under the various agreements with key off-taker Union Goal, and in late 2022, began making third-party sales at market prices.
The company also derives revenue from platinum group metals concentrate sales under an off-take agreement with Impala Platinum.
Eastplats also said on Friday an investigation into "unproven" whistleblower allegations continues to be conducted by a special committee comprising two independent directors.
These include allegations levelled by minority shareholders earlier this year – and relating to undisclosed related party transactions pertaining to the sale of chrome concentrate at discounted prices.
"The committee's work in retrieving and reviewing relevant documents, with the assistance of independent counsel and a third-party e-discovery specialist, continues," Eastplats said on Friday.
"The committee anticipates conducting further interviews with material persons, consistent with the committee's mandate. A report of the committee's findings will be provided to the board."
Shares in Eastplats were trading more than 8% lower on Friday and have lost more than 70% of their value so far in 2023.
