Solid earnings for Sylvania platinum, but weak ZAR hurting

Sylvania Platinum was looking at solid earnings in its interim results to 31 December 2015 on Monday, but the weakness of South Africa's currency was hurting its cash reserves.

The AIM-traded firm saw group adjusted EBITDA lift 59% to $3.61m (£2.5m). Its Sylvania Dump Operations (SDO) capital expenditure was down 60% to $0.72m, and General and Administration charges were down 25% to $1.19m.

SDO production for the period was 29,519 ounces, up from 26,246 ounces in the previous corresponding period. Group cash costs were down 17% to $508 per ounce, and there were no lost time injuries.

The company's Steelpoort operation achieved the significant milestone of eight years without a lost time injury during the period as well.

Sylvania Platinum reiterated its intention to sell the chrome resource at Grasvally, and had appointed an international agent to handle the marketing of it.

"It is as yet too early to comment on the intended marketed cost of the deposit however; more information on the sale process will be published as it becomes available", the company's board said in a statement.

As at 31 December, Sylvania Platinum had cash and cash equivalents of $5.1m, reducing by 37% through the half-year.

"With most of the cash generated and held in South African Rand, the weakening of the rand against the US Dollar ... had a significant impact on the cash balance", the board explained.

During the half, Sylvania Platinum repurchased 6,183,974 shares and placed them in treasury to be awarded to senior management based on the attainment of performance criteria. At 1231 GMT, shares in the company were trading at 7.63p.