Zimplats' Quarterly Reports

Report for September 2001 Quarter

Highlights

• Excellent progress on the construction of the Ngezi Platinum Mine and the Ngezi to Selous highway.
• Recommissioning of the Selous Metallurgical Complex on schedule.
• Senior management team for the Project in place.
• Recruitment of middle-management and operators progressing according to plan.
• Significant progress towards completing the Absa loan documentation.
• Drawdown on Absa loan facility commenced.

Project Progress

Significant progress on the Ngezi/SMC Project has been made during the quarter. The Project remains within the capital budget and is expected to commence production as planned in January 2002.

Ngezi Platinum Mine

The major units of the mining fleet, as at the end of October 2001, are on site and operational. The fleet consists of the following units: two 250 tonne excavators; two 110 tonne excavators; one 90 tonne excavator; eight 100 tonne dump trucks; eleven 50 tonne dump trucks.

Drilling units of various sizes as required by the different phases of mining bulk waste and selective mining of waste and ore are now operational at the mine.

As at the end of September 2001, 2.5 million tonnes of waste had been mined.

Planned mining tonnages for the forthcoming quarter are 5 million tonnes waste and 170,000 tonnes ore. Production build-up will continue until May 2002, when 183,000 tonnes of ore and 2.3 million tonnes of waste are scheduled to be mined on a monthly basis.

The new crusher installation at the Ngezi minesite is 70% complete and is expected to be ready to process ore by 15 November 2001.

Support infrastructure such as accommodation, workshops, offices, power supply and water reticulation is complete.

Ngezi to Selous Highway

The road is 70% complete, with a major portion of the road sealed and the three major bridges 90% finished. The road is scheduled to be complete by the middle of December 2001. The road is expected to be completed on time and within budget.

Selous Metallurgical Complex

The recommissioning of the mills, concentrator, and smelter at the SMC is scheduled to be completed by the end of October 2001. Limited processing of stockpiled ore and reclaimed material will commence during November 2001, in preparation for the first ore shipments from the Ngezi Platinum Mine during late December.

Management and Staff

Hartley Management Company (Private) Limited (HMC) has successfully hired from within Zimbabwe all the senior management required for the Ngezi/SMC Project. The project management possesses the required skills and experience for the project and is supported by senior technical management personnel from Implats.

Good progress has been made in the recruitment of middle management and operators. HMC does not anticipate any skilled staff shortages at the SMC. The mining and transport contractors have also been able to recruit the required levels of skilled and trained employees for their operations.

Road Haulage Contract

The first of the ten prime movers for hauling the ore trailers has arrived in Zimbabwe for training of drivers and the balance of prime movers are scheduled to arrive over the next twelve weeks. The first trailer kits have arrived in Zimbabwe for local assembly and all trailers are expected to be assembled by the end of the year.

The transport of ore from Ngezi Platinum Mine to the SMC by road trains is scheduled to commence in the second half of December 2001.

PGM Prices

The slowdown in global consumer demand resulted in PGM prices declining during the quarter with platinum and palladium falling to US$440/ounce and US$390/ounce respectively.

Platinum and palladium prices have continued to weaken since September, reflecting the uncertainty that surrounds the world economic outlook at present.

For the information of shareholders, the platinum and palladium prices currently forecast by HSBC and J P Morgan respectively are summarised below:

Empowerment Placement

Zimplats is being continuously informed on the progress of negotiations between the National Investment Trust (NIT), to whom the proposed 15 percent placement at a market-ruling price placement will be made, and its financial advisers, to fund the empowerment placement in Zimbabwe.

The NIT board has approved a funding proposal from a South African corporate bank. This proposal is now being reviewed by Zimplats to ensure it complies with the terms agreed between Zimplats and the Ministry of Mines in the Framework Agreement. It is expected that the placement will be concluded shortly.

Impala Platinum Holdings Limited (Implats)

The benefits of the investment by Implats in Zimplats and the Project company, Hartley Management Company (Private) Limited (HMC), have been experienced during the quarter. HMC senior management has visited Implats’ operations in South Africa, gaining valuable insight into procedures and methods used. In addition, Implats technical management has made several visits to the SMC and Ngezi Platinum Mine, providing suggestions for the improvement of operational procedures.

Implats technical management will be advising HMC management during the build-up of production in the first half of 2002.

Excellent working relationships have been established between HMC, Zimplats and Implats. Management believes this will benefit the Project, Zimplats and its investors.

NgeziI/SMC Project Funding

The US$30 million investment in HMC by Implats has been utilised in project development and HMC is currently accessing the Absa loan facility of US$30 million for the remaining development expenditure.

HMC has agreed the operational procedures for the offshore bank accounts with the Reserve Bank of Zimbabwe. The bank account to handle the loan funds from Absa and the project disbursements are operational and the bank account for the proceeds of exports is established, and will operate once sales of product commence.

The total funding established for the Project is expected to be sufficient to carry it through to positive cash flow.

Share Price

Several factors have combined to depress the share price: the global economic downturn, exacerbated by the tragic events in New York on the 11 September 2001; the decline in PGM prices brought about by the global economic slow-down; the political and economic situation prevailing in Zimbabwe.

The share price reached a low of A$0.66c per share on 28 September 2001 and has subsequently recovered to A$0.84c.

Zimbabwe Political & Economic Situation

The economic situation in Zimbabwe remains depressed and is likely to remain so until the political uncertainties in the country are resolved. It is hoped that the political situation will improve during 2002 after the Presidential election which is expected to be held in March 2002.

The economic situation in Zimbabwe and the shortage of foreign currency have not affected the Project or Zimplats in any material manner. The financial parameters of the Project agreed to between Zimplats and the Government of Zimbabwe ensure that the Project retains sufficient foreign currency receipts to cover all its commitments to external supplies of goods and services, including fuel for operations. These parameters will also assist HMC in securing sufficient electrical power for mining and processing operations.

Zimplats continues to monitor the economic and political situation carefully to ensure that action can be taken immediately to address issues that may negatively affect the Project or the Company.

Investor Information

Capital Structure

As at the 30 September 2001 Zimplats had 88,361,820 fully paid and quoted shares on issue. A total of 326,000 employee and director share options have been approved for the year 1999 at A$0.40, and 1,335,000 share options approved for 2000 at A$0.50. These options have been allocated in accordance with the Employee Share Option Scheme approved by shareholders in General Meeting on 28 May 2001. There are no other share options on issue.

Reporting calendar

The intended dates for the AGM and future report are as follows:

Matters relating to the number of shares held and change of address should be directed to the share registry at: Computershare Registry, GPO Box 7054, Sydney NSW1115, Australia.

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