Zimplats' Quarterly Reports

REPORT FOR THE QUARTER ENDED 30 SEPTEMBER 2002

HIGHLIGHTS

• Makwiro operating cash flow increases by 61% to US$7.5 million for the quarter.
• Ore mined/milled increases 35% over previous quarter.
• 7% increase in grade for the quarter to 3.1g/t Pt + Pd + Rh + Au ("4E").
• Makwiro operating costs lower at US$250/oz 4E partially due to Z$ based costs.
• Trial underground mining at Ngezi commences.

The September quarter is the second quarter of production for Zimplats’ 70% owned subsidiary Makwiro and the first quarter for the financial year ending June 2003.

Ngezi Platinum Mine

Grade

The improvement of grade control procedures continues to be one of the main focuses of management at the Ngezi Platinum Mine. Blasting and mining methods are being reviewed on an on-going basis with a view to minimising dilution and improving the grade of the ore supplied to the Selous Metallurgical Complex. These ongoing measures have resulted in an improvement in the grade achieved during the quarter.

Selous Metallurgical Complex

Concentrator

The new SAG mill liners installed in the previous quarter have performed well. A SAG mill reline is planned for the December 2002 quarter. Management, in conjunction with the mill liner manufacturer, continues to evaluate the profile and composition of the liners to increase their efficiency and durability.

Smelter

The smelter operated at, or above, its normal capacity during the quarter processing all the quarter’s concentrate production, plus the remaining concentrate stockpiled in the March quarter as a consequence of the fire in the smelter in February 2002. The concentrate stock level is now running at the planned level.

The installed concentrate filter presses are operating at their maximum capacity. In order to process increased future concentrate volumes, additional filter press capacity is to be installed during the December 2002 quarter.

Zimplats has commenced work on a feasibility study for a potential new mining operation. The new mine is envisaged to be an underground mechanised room and pillar operation. As part of the feasibility study, trial underground mining has commenced at the Ngezi Platinum Mine. The trial mine is being undertaken in order to finalise the geotechnical requirements, the grade control procedures and to establish the operating costs with a higher degree of accuracy. Currently the highwall support including the shotcreting has been completed and the inpit and portal drainage systems are in place. To date a total of 38 metres of 5 metre x 3 metre drives has been developed on reef. It is anticipated that by the end of December 2002, Zimplats should have opened up the initial stoping rooms. Zimplats expects to complete the trial mine by the end of July 2003 by which stage approximately 100,000 tonnes of ore is planned to have been extracted.

RESERVES & RESOURCES

Assuming no fundamental flaws are encountered in the trial mine by the end of the December quarter, Zimplats expects to convert a significant proportion of its 100% owned measured and indicated resources into reserves.

 

EXPLORATION

During the quarter under review no exploration expenditure was incurred. Exploration activities, in the near future, should consist of infill drilling within existing resource areas in order to obtain further data on these resources to facilitate their upgrading.

FINANCIAL

 

The Makwiro revenue and operating cost for the September quarter, which is 70% attributable to Zimplats, is tabled below:

 

Operating cash floe	September Quarter 2002 US$ ’000	June Quarter 2002 US$ ’000
Revenue	16,900	16,534
Operating Cost	9,448	11,901
Operating Cash Flow	7,452	4,633

The quarter under review has benefited from lower than anticipated local operating costs, denominated in Zimbabwe dollars. It is anticipated, however, that some of these costs may increase as local costs become aligned to the US dollar. Makwiro has allowed for these potential increases in its operating budget.

PROJECT PROGRESS

 

The Ngezi/SMC Project development phase was officially closed off 10% under budget during the quarter. The final project cost compared to the budget is as shown in the table below:

The average pgm and gold prices for the past 4 quarters are as follows:

The National Investment Trust has not yet secured funding to take up the empowerment placement shares. Management has been informed of two funding possibilities being pursued by the Trust in an effort to purchase the shares.

Capital Structure

As at the 30^th September 2002, 88,361,820 fully paid and quoted shares were on issue. Options granted to employees, management and directors remain unchanged at 3,191,000 options. The options, with the exception of the 1999 options, which vested in 2000, vest over a 3-year period, and must be exercised within 5 years of the date of issue. The share options issued to date, plus the exercise price, are tabled below. No options were issued, or exercised, during the quarter.

Share Options Issued

Major shareholders

During the quarter, Impala Platinum Holdings Limited ("Implats") increased its beneficial interest in Zimplats through the acquisition of the 21.05% equity previously held by Delta Gold Limited, (AurionGold Limited). Further to the ASX announcements regarding this transaction, Zimplats anticipates that discussions with Implats will be concluded shortly, and shareholders will be advised of the outcome in due course.

Shareholder enquiries

Matters relating to the shareholdings should be directed to the share registry at: Computershare Registry Services Pty Ltd, GPO Box 7054, Sydney NSW 1115, Australia. Tel: +61 2 8234 5222, Fax: +61 2 8234 5070.

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