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Send  Share  RSS  Twitter  10 Nov 2009

MINING: Trans Hex Returns To Profitability

 



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Cape Town-based Trans Hex announced its interim results for the period ended 30 September 2009, marking a return to profitability.

"Our focus on stringent cost management yielded  reductions in operating costs, whilst cash generated from operations resulted in a net cash inflow of R42 million, against a net outflow of R97 million in the previous period,” says Trans Hex CEO, Llewellyn Delport.

Increased volumes, and a weaker Rand/US dollar exchange rate, resulted in a 12.5% increase in sales revenue to R371 million; this despite diamond prices being lower than in the same period last year. Similarly, mining income increased to R32 million from a R22 million loss in the previous corresponding period.

Diamond prices and demand came under significant downward pressure in the latter half of the previous financial year.  The current period saw prices stabilise and increase with all production being sold,” says Delport

Cost reductions saw cash operating costs decrease by R85 million while profit after taxation increased to R9 million from a loss of R64 million. Earnings per share from continuing operations increased to 9.7 cents from a loss per share of 53.0 cents and net asset value per share increased by 25% from 31 March 2009.

Production from the group’s South African operations showed improvement increasing from 43,670 carats to 45,502 carats, despite the rationalisation of operations, as a result of improved grades being achieved. Total sales attributable to these operations amounted to $45 million, achieved at an average sales price of $914 per carat.

Trans Hex expects that its South African Land operations will yield approximately 100,000 carats for the current financial year. The grade at Baken, South Africa is expected to improve as planned mining operations have moved to areas which are expected to produce higher grades.

Negotiations at Luana, Angola are continuing and are expected to be concluded by financial year end.

We expect the demand and pricing of our products to be steady over the remainder of the financial year; we will continue to focus on cost and cash control measures, as the market shows signs of recovery,” says Delport.



 
 
 
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