Aquarius Platinum Ltd (AQP.L: Quote) (AQP.AX: Quote), the world's fourth-biggest producer of platinum, said on Tuesday it swung to a net profit in its third quarter to end-March as higher precious metal prices and a weaker rand outweighed lower output.
The South African-focused company posted a net profit of $6.5 million, which compared with a loss of $48.6 million in the previous quarter, as revenue grew to $80.5 million.
Its production in the latest quarter fell to 97,212 platinum group metals (PGM) ounces, mainly due to the temporary closure of the Everest mine, down from 131,843 ounces in the three months to end-December.
The calendar quarter to March is traditionally the lowest average quarterly production for our South African operations because it includes the Christmas and New Year holiday periods, said Chief Executive Stuart Murray.
Adjusting for the holidays, the quarter revealed some good improvements in terms of production and costs, he said.
The group said it anticipates lower unit costs in the fourth quarter as production rises due primarily to increased shifts, though also due to falling prices for diesel, chemicals and steel.
At 0821 GMT the shares were down 0.8 percent at 230.75 pence in London. The shares have jumped almost 40 percent this year helped by higher PGM prices.
March-quarter results showed that Aquarius Platinum is recovering from its production and financial concerns and the June quarter should see a further improvement in performance, said Evolution Securities in a note.
Against this backdrop, however, the company remains singularly exposed to platinum group metals and the outlook for the prices of these commodities is intricately tied to the car market.
Prices rose for platinum, palladium and gold during the quarter to end March, although rhodium dipped.
The results were bought forward a week partly as a result of its rights issue.
In March, it raised $121.7 million in a share placing and gave details of a rights issue which will deliver a further $69.6 million as it seeks to pay off a bridging loan and fund operating expenses.
It had $65 million in cash as of end March.
It plans to buy Ridge Mining Plc (RDG.L: Quote) in a move that will give Aquarius access to Ridge's flagship Blue Ridge Mine, the nearby Sheba's Ridge Project and boost Aquarius' resource base. (Editing by Greg Mahlich)
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