Harare — Zimbabwe Platinum Mines is still engaging Government on the US$34 million that it is owed by the Reserve Bank.
Zimplats in its latest quarterly report indicated that discussions with Government were ongoing. "Discussions on the repayment of the Reserve Bank of Zimbabwe debt of US$34 million by the Government are still to be concluded," said Zimplats in its quarterly update.
Government recently indicated that it had assumed all of the central bank's debt amounting to US$1,5 billion including the US$34,13 million. The central bank's debtors descended had on the institution attaching property in a bid to recover what they are owed. The US$34,13 million, which was lodged with the RBZ was to be drawn in Zimbabwe dollars to fund local costs.
When the local currency ceased to be legal tender in February 2009 the central bank could not immediately refund the deposit. Meanwhile, Government has also appointed an independent expert to review the Additional Profit Tax provisions of the Income Tax Act following Zimplats' protracted battle with the Zimbabwe Revenue Authority over its liability to pay the tax.
"The Government has appointed an independent expert to review the Additional Profits Tax provisions of the Income Tax Act. "The review is scheduled to be completed by end of December 2010 as part of an on-going overhaul of the Income Tax Act," added the platinum miners.
The dispute arises from an undertaking given to Zimplats in 2001 by Government that the company would not be liable for Additional Profit Tax. Meanwhile, during the period under review Zimplats registered a US$56 million operating profit, a one percent decline from the previous quarter's figure of US$57 million which it attributed to a decline in sales volumes.
Revenue and operating costs for the quarter were marginally lower than the previous quarter in line with the decrease in sales volumes. Consequently, an operating profit of US$56 million was recorded, percent lower than the previous quarter," the company said.
Cash cost of producing a 4E ounce declined by four to US$536, which it attributed to the higher production volume. "Cash cost of production per 4E ounce were 4 percent lower than the previous quarter reflecting the impact of higher production volumes," said Zimplats. The company however raised concern over the impact of the softening of metal prices.
"Although average metal prices realised were higher than the previous quarter, the prices have since softened considerably reflecting market concerns over the general health of the European economies," said the company.
Zimplats said its mine development at Bimha Mine remained on course for completion next year while expansion of Ngezi Phase II had commenced after securing the required funding.
"Development of Bimha Mine remains on course for completion by May 2011. Implementation of the Ngezi Phase II Expansion Project has commenced. The funding arrangements for the project are now in place," added Zimplats.
