ANNUAL RESULTS PRESENTATION For the year ended 31 March 2015 - - PowerPoint PPT Presentation

ANNUAL RESULTS PRESENTATION

For the year ended 31 March 2015

CONTENT

• Financial overview
• South African operations
• Angolan operations
• West Coast Resources
• Conclusion

Trans Hex Group Annual Results Presentation 2015

CONTENT

• Financial overview
• South African operations
• Angolan operations
• West Coast Resources
• Conclusion

Trans Hex Group Annual Results Presentation 2015

FINANCIAL OVERVIEW

FINANCIAL OVERVIEW

Trans Hex Group Annual Results Presentation 2015

March 2015 March 2014 Rand revenue (Rm) 939,7 695,7 Cost of goods sold (Rm) (788,8) (653,7) Profit/(loss) from continuing operations* (Rm) 169,1 (5,1) Profit from discontinued operations (Rm) 21,5 27,8 Profit for the year (Rm) 190,6 22,7 HEPS (cents) 78,6 9,8 Cash position (Rm) 407,2 397,6 Net asset value per share (cents) 630 521 *Profit reflects a share of results of associated companies of R136,0 million and impairments of R86,2 million. During the period, impairment tests on the Group’s assets resulted in the ageing Baken and Reuning projects being impaired to the value of R71,0 million and R15,2 million respectively.

GROUP PROFIT/LOSS AFTER TAX

Trans Hex Group Annual Results Presentation 2015

2011 2012 2013 2014 2015 R million

• 45

208 85 23 191

• 60
• 30

30 60 90 120 150 180 210 240

SOUTH AFRICAN OPERATIONS

SA PRODUCTION

Trans Hex Group Annual Results Presentation 2015

2011 2012 2013 2014 2015 Carats 69 508 84 409 67 115 52 081 61 688 10 000 20 000 30 000 40 000 50 000 60 000 70 000 80 000 90 000 100 000

Note: SA production in 2015 amounted to 61 688 carats, of which Remhoogte contributed 4 241 carats. The Remhoogte mining right was sold during the period under review.

LOWER ORANGE RIVER – AVERAGE GRADE

Trans Hex Group Annual Results Presentation 2015

2011 2012 2013 2014 2015 Average grade 1.27 1.57 1.05 0.92 1.29 0.00 0.50 1.00 1.50 2.00 2.50

SA DIAMOND PRICES

Trans Hex Group Annual Results Presentation 2015

2011 2012 2013 2014 2015 Price/carat $1 162 $1 200 $1 334 $1 238 $1 353 $0 $200 $400 $600 $800 $1 000 $1 200 $1 400

Note: The average price per carat for 2015 excluding Remhoogte was $1 287 per carat. The Remhoogte mining right was sold during the period under review.

SA UNIT COST

Trans Hex Group Annual Results Presentation 2015

1 000 2 000 3 000 4 000 5 000 6 000 50 60 70 80 90 100 110 120 130 140 2011 2012 2013 2014 2015 Gravel treated m3 ('000) Unit cost Rand/m3

Unit cost Gravel

LOR unit cost increased by 23,6% due to a 16,6% decrease in volumes treated and an increase in operating costs.

SA OUTLOOK

• Stripping operations in the Baken central channel will continue

until the economically viable gravel in the main channel has been exhausted, which is expected to be towards the end of the 2016 financial year. Thereafter mining activities will focus on shallow deposits and lower grade stockpiles.

• Steady performance at Bloeddrif Mine is expected to continue.
• South African production for the 2016 financial year is expected

to be in the order of 53 000 carats, compared to 2015 actual production of 61 688 carats.

• With diamond fundamentals remaining strong, diamond prices

are set to recover in the year ahead. Demand for Trans Hex production is anticipated to increase towards the end of the calendar year in line with expected market trends.

Trans Hex Group Annual Results Presentation 2015

ANGOLAN OPERATIONS

SOMILUANA PRODUCTION

Trans Hex Group Annual Results Presentation 2015

2011 2012 2013 2014 2015 Carats 27 662 45 869 41 313 72 041 94 483 10 000 20 000 30 000 40 000 50 000 60 000 70 000 80 000 90 000 100 000

SOMILUANA AVERAGE GRADE

Trans Hex Group Annual Results Presentation 2015

2011 2012 2013 2014 2015 Average grade 18.36 19.16 16.60 23.95 27.99 5 10 15 20 25 30

SOMILUANA DIAMOND PRICES

Trans Hex Group Annual Results Presentation 2015

2011 2012 2013 2014 2015 Price/carat $351 $446 $352 $478 $458 $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500

ANGOLAN OUTLOOK

• Somiluana Mine continues to increase its production capacity

through the reinvestment of surplus internal cash flows.

• Due to the encouraging results and in order to speed up the

expansion of the production footprint, external funding is being considered.

• Production results and geological work through drilling and bulk

testing indicate that carat production for the 2016 financial year will surpass the 94 000 carats achieved in 2015.

• During the 2015 financial year, cumulative profits since the

exploration phase exceeded the exploration costs previously expensed and a R12,7 million profit was recognised. This does not represent a full year’s profit and an increase in the profit from this project for 2016 is therefore expected.

Trans Hex Group Annual Results Presentation 2015

WEST COAST RESOURCES WEST COAST RESOURCES

WEST COAST RESOURCES

• The acquisition of assets and liabilities relating to Namaqualand

Mines became effective on 28 October 2014.

• Emerald Panther Investments 78 (Pty) Ltd, in which Trans Hex

holds a 40% interest, changed its name to West Coast Resources (Pty) Ltd with effect 21 January 2015.

• Operations in Namaqualand commenced in December 2014 with

the construction of a final recovery plant at Kleinzee. The plant was commissioned during March 2015 and is currently treating final recovery tailings.

Trans Hex Group Annual Results Presentation 2015

WEST COAST RESOURCES (cont.)

• At Mitchell’s Bay, exploration drilling is underway and the

construction of a production treatment plant is due to be completed towards the end of the calendar year.

• A bulk sampling plant at Koingnaas will be sampling ahead of

production.

• Net revenue from the treatment of the small remaining tonnages
• f final recovery tailings is not expected to cover project
• perational expenditure during the 2016 financial year. As this

project is still in a start-up phase, a loss is expected for the 2016 financial year.

Trans Hex Group Annual Results Presentation 2015

CONCLUSION

CONCLUSION

• Existing SA assets are nearing end of life in their current form.
• Somiluana continues to grow and production for 2016 is

expected to surpass 94 000 carats. Profit is also expected to increase.

• Operations at West Coast Resources are underway at Kleinzee

and Koingnaas and a production treatment plant at Mitchell’s Bay is scheduled to be completed towards the end of the calendar

• year. As this project is still in a start-up phase, a loss is expected

in 2016.

• Tight controls over cash and costs will continue to be exercised

in all areas of the Group’s business.

• In respect of new business opportunities, the Group continues to

evaluate potential new ventures on an ongoing basis.

Trans Hex Group Annual Results Presentation 2015

www.transhex.co.za

Trans Hex Group Annual Results Presentation 2015

Disclaimer: This presentation contains forward-looking statements about the Company’s operations, exploration activities and financial conditions. They are based on Trans Hex Group’s best estimates and information at the time of

• writing. They are nonetheless subject to significant uncertainties and contingencies, many of which are beyond the

control of the Company. Unanticipated events will occur and actual future events may differ materially from current expectations due to explorations results, new business opportunities, changes in priorities by the Company or its joint ventures, as well as other factors. Any of these factors may materially affect the Company’s future business activities and its ongoing financial results.