Platinum Group Reports Q1 2013 Financial Results
VANCOUVER, BRITISH COLUMBIA and JOHANNESBURG, SOUTH AFRICA --
(Marketwire) -- 01/14/13 -- Platinum Group Metals Ltd. (TSX:PTM)(NYSE
MKT:PLG) ("Platinum Group" or the "Company") reports the Company's
financial results for the three months ending November 30, 2012. For
details of the November 30, 2012 Condensed Consolidated Interim
Financial Statements ("Financial Statements") and Management's
Discussion and Analysis please see the Company's filings on SEDAR
(www.sedar.com) or on EDGAR (www.sec.gov). Shareholders are
encouraged to visit the Company's website at
www.platinumgroupmetals.net. Shareholders may request a copy of the
complete November 30, 2012 Financial Statements from the Company free
The Company's cash position at November 30, 2012 was $35.30 million,
including approximately $27.08 million in restricted cash. At January
14, 2013 the Company's cash position is approximately $211.0 million,
including approximately $25.0 million in restricted cash. The company
holds cash in both Canadian dollars and South African Rand and
changes in the exchange rate may create variance in the cash holdings
reported in Canadian dollars. All amounts herein are reported in
Canadian dollars unless otherwise specified.
The Company obtained credit approval for a $260 million project loan
facility on December 6, 2012 and closed a $180 million equity
financing on January 4, 2013 (details below).
Highlights For The Quarter Ending November 30, 2012
-- A US $100 million Phase 1 development program is approximately 80%
complete at Project 1. A central box cut excavation has been completed.
The sinking of twin declines at the central location is progressing
well. Both declines are now advanced to more than 850 metres linear from
their collar. Substantial surface infrastructure has now been
constructed on site.
-- Safety, in all our operations, is our number one priority, and the
Company is pleased to report that onsite safety performance at Project 1
has been excellent to date with approximately 1,050,000 man hours worked
with a very low lost time incident rate.
-- On September 4, 2012, the Company published an inferred mineral resource
estimate on the Waterberg Project area. The initial inferred mineral
resource estimate covers the first 1.8 km of T-layer and 2.8 km of F-
layer strike length starting from the southern boundary of the property
position. On November 5, 2012, the Company announced that new drill
intercepts had approximately doubled the known strike length of the
Waterberg Project. The F-layer has now been intercepted in boreholes up
to 2.7 km north of the initial mineral resource area. The Company
published an updated technical report entitled "Updated Exploration
Results and Mineral Resource Estimate for the Waterberg Platinum
Project, South Africa" on November 23, 2012.
-- On September 5, 2012, the Company received notice from Rustenburg
Platinum Mines Limited ("RPM"), a wholly owned subsidiary of Anglo
American Platinum Limited, that RPM would exercise of its 60-day right
of first refusal to purchase the off-take of concentrate from Project 1
on terms equivalent to terms agreed with another commercial off-taker.
Formal legal agreements are currently in process of being drafted based
on the third party indicative terms described above. The indicative
terms from the other commercial off-taker do not vary substantially from
the terms modeled in the updated feasibility study on Project 1 entitled
"Updated Technical Report (Updated Feasibility Study) Western Bushveld
Joint Venture Project 1 (Elandsfontein and Frischgewaagd)" dated
November 20, 2009 with an effective date of October 8, 2009 (the "2009
Results For The Period
During the three months ended November 30, 2012, the Company incurred
a net loss of $1.82 million (November 30, 2011 - net loss of $5.32
million). General and administrative expenses during the period
amounted to $0.78 million (November 30, 2011 - $1.31 million), losses
on foreign exchange, due primarily to a weaker Rand at period end,
were $0.21 million (November 30, 2011 - loss $3.18 million), while
stock based compensation expense, a non-cash item, totalled $1.16
million (November 30, 2011 - $1.91 million). Finance income
consisting of interest earned and property rental fees in the three
months amounted to $0.59 million (November 30, 2011- $1.08 million).
Loss per share for the period amounted to $0.01 per share, as
compared to a loss of $0.03 per share for the comparative period of
Accounts receivable at November 30, 2012 totalled $1.98 million while
accounts payable and accrued liabilities amounted to $6.26 million.
Accounts receivable were comprised primarily of value added taxes
repayable to the Company in South Africa. Accounts payable included
accrued professional fees, contract construction fees, drilling
expenses, engineering fees and regular trade payables for ongoing
exploration and development costs and administration.
Total expenditures by the Company for development and purchases of
property and equipment for Project 1 during the period totaled $9.0
million, before including the effects of foreign currency exchange
rate fluctuations. Expenditures by the Company during the three month
period for exploration on Waterberg were approximately $3.23 million,
of which $1.15 was funded by joint venture partner the Japan Oil, Gas
and Metals National Corporation.
The completion of an $180,000,000 equity financing and the credit
approval for a $260 million project loan launches the Company into
Phase 2 construction for the WBJV Project 1 and provides the
Company's share of a $10,000,000 exploration budget for the Waterberg
On December 6, 2012, the Company announced the receipt of credit
committee approval for a US $260 million project loan facility by a
syndicate of four international banks. The maturity date of the
project loan facility is expected to be August 31, 2020. Closing and
draw down of the project loan facility is now subject to the
negotiation and execution of final documentation and satisfaction of
certain conditions precedent, which will include the Company and
Wesizwe providing a tranche of equity capital into Project 1, a cost
overrun facility and a working capital provision.
On December 10, 2012 and December 12, 2012 the Company announced and
then priced an offering of 225,000,000 common shares at a price of
$0.80 per common share, for aggregate gross proceeds of $180,000,000
(the "Offering"). Closing of the Offering occurred on January 4, 2013
for net proceeds to the Company of $169,565,000, after underwriters'
fees and the estimated expenses of the Offering. The Company had
granted the underwriters an option, exercisable for a period of 30
days following the closing of the Offering, to purchase additional
common shares representing an additional 15% of the Offering to cover
over-allotments. Subsequent to the closing of the offering the
Company has been notified by the underwriters that the underwriters
will not be exercising any of the over-allotment option. Net proceeds
of the Offering will be used to partially fund the development of
Project 1, as described above and below, for the Company's share of
exploration and engineering work at Waterberg, and for general
working capital purposes.
At Waterberg, 10 rigs are now resuming drilling after having been
shut down over the Christmas break. An updated resource estimate for
Waterberg is in process. Approximately 46 holes have now been
drilled; an additional 30 holes since the cut off for the initial
inferred mineral resource announced on September 4, 2012. Assay
results for many holes are pending at this time. A US$ 10.0 million
program has been approved for 2013 at Waterberg by the joint venture
partners for drilling, geophysics and the completion of a preliminary
economic assessment report.
The Company's key business objectives for 2013 and into 2014 will be
to continue with the underground development and mine construction at
Project 1 and to continue exploration at the Waterberg Project. The
expected grant of additional pending exploration permits at Waterberg
would allow exploration efforts on that project to expand both up dip
and along strike from the known deposit area. Closing and drawn down
of the planned project loan facility is expected to fund the
completion and commissioning of Project 1.
The Company will invest from current cash on hand for the
commencement of Phase 2 construction. Work to complete final loan
documentation and final off-take agreements is in process. Draw down
from the project loan facility is planned following completion of all
final documentation, conditions precedent and the required project
equity investment by the Company. Phase 2 will include a second
decline access south of the current twin decline development,
underground lateral development, a milling and concentrating facility
and tailings impoundment area. Central decline development is now
more than 850 metres linear into the underground and a second box cut
excavation for south decline access is now nearly complete and ready
for the turn under into underground development. Plant and facility
construction and commissioning are estimated to take up to two years
to complete. Full commercial production at steady state is estimated
to occur after a two year ramp-up period subsequent to the
commissioning of the plant planned to commence in late 2014.
About Platinum Group Metals Ltd.
Platinum Group is based in Johannesburg, South Africa and Vancouver,
Canada. The Company's main asset is a 74% interest in Project 1 near
Rustenburg, South Africa, where a Phase 1 construction budget of US
$100 million is nearing completion and Phase 2 construction is
commencing. Project 1 has an estimated steady state production of
275,000 ounces per year of platinum group metals. Platinum Group also
has active exploration programs and a new platinum deposit discovery,
near surface at the Waterberg joint venture in South Africa.
Waterberg is in joint venture with the Japan Oil, Gas and Metals
R. Michael Jones, P.Eng., the Company's President, Chief Executive
Officer and a significant shareholder of the Company, is a
non-independent qualified person as defined in National Instrument
43-101 Standards of Disclosure for Mineral Projects and is
responsible for preparing the technical information contained in this
On behalf of the Board of Platinum Group Metals Ltd.
Frank R. Hallam, CFO and Director
This press release contains forward-looking information within the
meaning of Canadian securities laws and forward-looking statements
within the meaning of U.S. securities laws ("forward-looking
statements"). Forward-looking statements are typically identified by
words such as: believe, expect, anticipate, intend, estimate, plans,
postulate and similar expressions, or are those, which, by their
nature, refer to future events. All statements that are not
statements of historical fact are forward-looking statements.
Forward-looking statements in this press release include, without
limitation, statements regarding the closing, drawdown, the
satisfaction of certain conditionals precedent and the expected
maturity date of the project loan facility, the completion of formal
agreements relating to off-take on Project 1, use of net proceeds of
the Offering, the completion of an updated resource estimate for
Waterberg, the expected grant of exploration permits at Waterberg,
commencement and completion of Phase 2 development at Project 1, the
timing of first ore production and concentrate sales, and further
exploration and development on the Company's properties. In addition,
the results of the 2009 UFS may constitute forward-looking statements
to the extent that they reflect estimates of mineralization, capital
and operating expenses, metal prices and other factors. Although the
Company believes the forward-looking statements in this press release
are reasonable, it can give no assurance that the expectations and
assumptions in such statements will prove to be correct. The Company
cautions investors that any forward-looking statements by the Company
are not guarantees of future results or performance, and that actual
results may differ materially from those in forward looking
statements as a result of various factors, including, but not limited
to, variations in market conditions; the nature, quality and quantity
of any mineral deposits that may be locate; the Company's ability to
obtain any necessary permits, consents or authorizations required for
its activities; the Company's ability to successfully complete formal
agreements relating to off-take on Project 1; the Company's ability
to produce minerals from its properties successfully or profitably,
to continue its projected growth, or to be fully able to implement
its business strategies and other risk factors described in the
Company's Form 40-F annual report, annual information form and other
filings with the SEC and Canadian securities regulators, which may be
viewed at www.sec.gov and www.sedar.com, respectively.
The Toronto Stock Exchange and the NYSE MKT LLC have not reviewed and
do not accept responsibility for the accuracy or adequacy of this
news release, which has been prepared by management.
Platinum Group Metals Ltd.
R. Michael Jones
(604) 899-5450 or Toll Free: (866) 899-5450
Platinum Group Metals Ltd.
VP, Corporate Development
(604) 899-5450 or Toll Free: (866) 899-5450
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