Annual Report 2002

Directors' Report

The Directors have pleasure in presenting their report, together with the financial report of Zimbabwe Platinum Mines Limited (“Zimplats”) and the consolidated financial report of the Group, being Zimplats and its controlled entities, for the year ended 30 June 2002.

Purpose of the Company

Zimplats’ main purpose is the production of platinum group metals from its reserves and resources on the Great Dyke in Zimbabwe. During the year under review, the company’s activities moved from principally exploration and evaluation to development and production with the commissioning of the Ngezi/SMC project through a controlled subsidiary company, Makwiro Platinum Mines (Private) Limited (“Makwiro”).

Reporting currency and rounding of amounts

The financial reports have been prepared in United States dollars (US$).

Zimplats is a company of a kind referred to in ASIC Class Order 98/100 dated 10 July 1998. In accordance with that Class Order, amounts in the financial report have been rounded off to the nearest thousand dollars, unless otherwise indicated.

Capital

Authorised share capital

The authorised share capital of the company remains unchanged since last year at 500 million ordinary shares of 10 cents each.

Issued share capital

No new shares were issued during the year and the issued share capital remains at 88 361 820 fully paid ordinary shares of 10 cents each.

Unissued share capital

In terms of the Articles of Association of the company, unissued shares are under the control of the directors.

Proposed Empowerment Placement

Zimplats supports the Government of Zimbabwe in its endeavour to encourage Zimbabweans to acquire meaningful investments in major companies operating in key sectors of the economy, and the National Investment Trust (“NIT”) has been established for this purpose. The NIT is structured as a unit trust in order to make these investments affordable to as many Zimbabweans as possible.

Zimplats has agreed to place up to 13 254 273 new ordinary shares (equivalent to 15% of Zimplats’ issued share capital) with the NIT. The shares will be issued at the average market price for the company’s ordinary shares over the last five days on which those shares traded on the ASX, before the day on which the issue is made.

At the time of writing this report, the NIT had not taken up the offer. 

Results for the year

The results for the year are set out in the annual report. The company commissioned its first project during the year under review and more details of the initial start up phase and operations are found in the operations report in the annual report.

This development marks a significant milestone in the history of the company and directors are pleased to report that commissioning was achieved on time and close to budget.

Directors

Composition of the Board

On 20 July 2001, Louis Rozman was appointed as AurionGold’s representative on the Zimplats Board. He replaced Terry Burgess who resigned on 30 June 2001.

The current directors are:-

Chairman

(Non-executive) Robert George Still
BCom (Wits), BCom (Hons)(UCT), CTA (Wits), CA(SA)
Appointed as director on 28 July 1998.

Rob Still is a founding member of the Board of Directors and was elected Chairman on 30 March 2001. He has more than seventeen years’ experience in mining and mining finance and is currently the Chief Executive Officer of a titanium mineral sands project in southern Africa.

Executive directors

Chief Executive Officer – Roy Aubrey Pitchford
FCCA, CA(Z)
Appointed as director on 01 May 2000.

Roy Pitchford has more than twenty years’ senior management and executive experience in southern Africa including eight years in the mining industry where he was Chief Executive Officer of Cluff Resources Zimbabwe Limited and Delta Gold Zimbabwe (Private) Limited. He is a past president of the Zimbabwe Chamber of Mines.

Chief Financial Officer – Gregory Sebborn
FCCA, CA(Z)
Appointed as director on 05 April 2001.

Greg Sebborn has extensive senior and executive management experience in southern Africa. He joined Zimplats in 1998 and established the accounting and administrative framework of the company. He has been intimately involved in all crucial commercial issues, including negotiations with BHP, Government of Zimbabwe, Impala and Absa.

Non-executive directors

David Hugh Brown
BCom (UCT), CTA(UCT), CA(SA)
Appointed as director on 30 March 2001.

David Brown is the Finance Director of Impala Platinum Holdings Limited and was appointed to the Zimplats Board as its representative. He has experience within the information technology and mining industries, five years of which was gained in Europe.

Glenn David Povey
BCom (UPE), CTA(UPE), CA(SA)
Appointed as director on 25 June 2001.

Glenn Povey was appointed to the Zimplats Board on 25 June 2001 as the Absa representative. He has more than seventeen years’ experience in the banking and corporate finance sector and is a specialist in many areas therein. He is currently Deputy General Manager (Corporate Finance and Investment Banking) with Absa Corporate and Merchant Bank in South Africa.

Louis Ivan Rozman *
BEng, MGeoscience, FAusIMM, MAICD, CP(Management) 
Appointed as director on 20 July 2001.

Louis Rozman has more than twenty years’ experience in mining operations, joint ventures and corporate management in Australasia and Africa. He is Chief Operations Officer of AurionGold Limited.

Peter Martin Vanderspuy
BSc, MSc, FAusIMM, MCIMM
Appointed as director on 28 July 1998.

Peter Vanderspuy is a founding member of the Board and is a past Chairman and Chief Executive Officer of both Zimplats and Delta Gold Limited (now known as AurionGold Limited). He was intimately involved with the Hartley and Ngezi projects from their inception. He has forty years’ experience in the mining industry in Australasia, Africa and North America.

In terms of the Articles of Association of the company, one third of the directors, excluding the Chief Executive Officer, will retire by rotation each year.

The directors retiring by rotation at the Annual General Meeting are Mr. D. H. Brown and Mr. G. Sebborn, who being eligible offer themselves for re-election.

* As a result of AurionGold Limited selling its 21.05% shareholding in Zimplats on the 22 August 2002 (refer note 30 in the financial report), Louis Rozman resigned as director of the company on that date.

Meetings of Directors

The following table sets out the number of Board meetings, including conference call meetings, held by Zimplats during the year under review, and those attended by each director.

Directors’ Interest

Details of directors’ interests in the ordinary shares of the company are shown below:

No options were exercised during the period under review.

None of the directors had any interests in the shares of the company’s subsidiaries at any time during the year. None of the directors had an interest in any contract of significance with the Group during the year.

Employment policies

Zimplats does not discriminate on the basis of race, religion, sex or disability and is committed to providing equal opportunities, safe working conditions and attractive remuneration to staff.

Policies on employment have been developed to suit prevailing conditions and in addition, a comprehensive policy on HIV/AIDS awareness, prevention and control is under development.

The company endeavours to attract and retain talented and suitably qualified and experienced staff through performance-based reward systems, including a senior staff share option scheme, and a productivity bonus scheme.

Share Option Scheme

The primary purpose of the scheme is to attract, motivate and retain key personnel. The directors believe that the future success of the company will depend in large measure on the skills and motivation of the people engaged in the management of the company’s business. It is therefore important that the company is able to attract and retain high calibre people. A central feature of the scheme is that restrictions have been placed on the exercise of the options, the effect of which is that participants will ordinarily only receive the full benefit of their options after three years of service. Details of the scheme are set out in note 25 of the financial statements.

Corporate Governance

A statement on Corporate Governance is set out in the annual report.

Indemnity of Officers

Zimplats’ Memorandum and Articles of Association includes indemnities in favour of persons who are or have been officers of the company. To the extent permitted by law, Zimplats indemnifies every person who is or has been an officer against:

• Any liability to any person (other than Zimplats or related entities) incurred while acting in their official capacity and in good faith; and

• Costs and expenses incurred by that person in that capacity in successfully defending legal proceedings and ancillary matters.

For this purpose, ‘officer’ means any director or secretary of Zimplats or any of its controlled subsidiaries, and includes any other person who is concerned, or takes part in management of Zimplats, or is an employee of Zimplats or any controlled subsidiaries thereof.

Zimplats has given similar indemnities by Deed of Indemnity in favour of certain officers in respect of liabilities incurred by them whilst acting as an officer of Zimplats or any subsidiary of Zimplats.

No claims under the abovementioned indemnities have been made against Zimplats during or since the end of the financial year.

Insurance for Officers

During and since the financial year under review Zimplats has paid premiums in respect of contracts insuring persons who are or have been officers of the company against certain liabilities incurred in that capacity.

For this purpose, ‘officer’ means any director or secretary of Zimplats or any of its controlled subsidiaries, and includes any other person who is concerned, or takes part in the management of Zimplats, or is an employee of Zimplats or any controlled subsidiaries thereof.

Under the abovementioned Deeds of Indemnity, Zimplats has undertaken to the relevant officer that it will insure them against certain liabilities incurred in their capacity as an officer.

Auditors

Messrs KPMG have indicated their willingness to continue as the company’s auditors. A resolution to authorise their re-appointment will be proposed at the Annual General Meeting.

Annual General Meeting

The Annual General Meeting of the company will be held in the Cornwallis Suite, Observatory Hotel, Sydney, Australia on Wednesday 20 November 2002 at 9:00am. Full details are given in the Notice of Meeting in the annual report.

By Order of the Board