Zimplats spends US$270m on projects in FY22, revenue 8% lower at US$1.2bn

Zimplats: Falling platinum prices force project delays (pic: Scotty Photography)

Zimplats spent US$270 million on capital projects in the year to June, up from US$159 million in the previous year, as the company expanded operations and replaced depleted mines.

Last year, Zimplats announced US$1.8 billion in new investment in Zimbabwe. This includes funding for developing a new mine, Mupani, to replace the depleted Rukodzi mine and Ngwarati, which reaches the end of its life in 2025.

“The upgrade of Mupani Mine from the current design capacity of 2.2 million tonnes per annum to 3.6Mtpa to replace part of the tonnage contribution from Mupfuti Mine on depletion in FY2027 was approved, increasing the estimated total project cost from US$264 million to US$386.2 million,” Zimplats says in an update.

In the year, the company spent US$44.1 million was spent on this project, bringing total spending so far on the project to US$190.7 million.

Zimplats expansion

By September 2024, Mupani will reach 2.2Mtpa, completely replacing Ngwarati and Rukodzi mines. Full production of 3.6Mtpa is expected in August 2028.

“A total of US$27.8 million was spent during the year bringing the total project to date expenditure to US$34.7 million,” Zimplats says.

Zimplats is spending US$520.6 million to build a new 38MW furnace and an acid plant.

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The company is building a new concentrator, which will raise annual concentrate output from 144 000 tonnes to 163 000 tonnes. The new furnace will increase smelting capacity from the current 135 000 tonnes of concentrate to 380 000 tonnes of concentrate.

“The project is on course for commissioning of the smelter in January 2024 and the acid plant in August 2024.”

On costs, Zimplats says it measured USD inflation at 5.4% year-on-year for the period. There was also an increase in permanent jobs as the company expanded operations, as well as a marginal drop in grades and recoveries.  

Revenue was down by 8% to US$1.2 billion as average PGM prices fell in the year. Post-tax profit dropped to US$353.6 million from the previous US$563.1 million.

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