Annual Results Presentation For the year ended 31 March 2016 - - PowerPoint PPT Presentation

Annual Results Presentation

For the year ended 31 March 2016

Trans Hex Group Annual Results Presentation 2016

CONTENTS

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

Divider Financial overview

Trans Hex Group Annual Results Presentation 2016

FINANCIAL OVERVIEW

March 2016 March 2015 Rand revenue (Rm) 671,4 939,7 Cost of goods sold* (Rm) (678,2) (788,8) Impairments# (Rm) (55,1) (86,2) (Loss)/profit from continuing operations (Rm) (124,8) 169,1 Profit from discontinued operations (Rm) 24,0 21,5 (Loss)/profit for the year (Rm) (100,8) 190,6 HEPS (cents) (56,9) 78,6 Cash position (Rm) 353,5 407,2 Net asset value per share (cents) 506 630 * Cost of goods sold included retrenchment costs at the Lower Orange River operations of R46,6 million. # Impairment tests on the Group’s assets resulted in the ageing Baken mine being impaired to the value of R55,1 million.

Trans Hex Group Annual Results Presentation 2016

GROUP PROFIT/LOSS AFTER TAX

2012 2013 2014 2015 2016 R million 208 85 23 191

• 101
• 110
• 80
• 50
• 20

10 40 70 100 130 160 190 220

2016: Loss includes retrenchment costs of R46,6 million and impairment costs of R55,1 million.

Divider South African operations

Trans Hex Group Annual Results Presentation 2016

SA PRODUCTION

2012 2013 2014 2015 2016 Carats 84 409 67 115 52 081 61 688 48 435 10 000 20 000 30 000 40 000 50 000 60 000 70 000 80 000 90 000 100 000

Trans Hex Group Annual Results Presentation 2016

LOWER ORANGE RIVER – AVERAGE GRADE

2012 2013 2014 2015 2016 Average grade 1.57 1.05 0.92 1.29 1.22 0.00 0.50 1.00 1.50 2.00 2.50

Trans Hex Group Annual Results Presentation 2016

SA DIAMOND PRICES

2012 2013 2014 2015 2016 Price/carat $1 200 $1 334 $1 238 $1 353 $981 $0 $200 $400 $600 $800 $1 000 $1 200 $1 400

Trans Hex Group Annual Results Presentation 2016

SA UNIT COST

1 000 2 000 3 000 4 000 5 000 6 000 50 70 90 110 130 150 170 2012 2013 2014 2015 2016 Gravel treated m3 ('000) Unit cost Rand/m3 Unit cost Gravel

The LOR operations unit cost of production for current operations increased by 18,8% due to a reduction in volumes treated and an 8,4% increase in

• perating costs.

Trans Hex Group Annual Results Presentation 2016

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 2018 financial year.

• Performance at Bloeddrif Mine is expected to improve with the

mining of higher grade basal gravel.

• At the LOR operations, 22% of the workforce accepted voluntary

retrenchment packages and a new shift system was introduced. Production estimates have been adjusted accordingly and production for 2017 is expected to be in the order of 41 000 carats.

• Post year-end, the diamond market is enjoying a relatively stable

period, improving the confidence of traders and dealers.

West Coast Resources operations

Trans Hex Group Annual Results Presentation 2016

WEST COAST RESOURCES OPERATIONS

• Construction of the Michells Bay production plant was completed

towards the end of the 2015 calendar year.

• Mining operations commenced in December 2015 in the

Langklip area and produced 16 517 carats at an average grade

• f 37,40 carats/100 m3.
• During the year the final recovery plant at Kleinzee treated final

recovery tailings and produced 8 413 carats.

• Total production amounted to 24 930 carats and sales amounted

to R49,4 million at an average price of US$208 per carat.

Trans Hex Group Annual Results Presentation 2016

WEST COAST RESOURCES OPERATIONS

(cont.)

• Mining activities will remain focused on the Langklip area and on
• ther sections of the Koingnaas area.
• On-going drilling and prospecting will continue to target high-priority

areas that may identify additional resources for mining.

• Production for the 2017 financial year is expected to be in the order
• f 123 000 carats.

Divider Angolan operations

Trans Hex Group Annual Results Presentation 2016

SOMILUANA PRODUCTION

2012 2013 2014 2015 2016 Carats 45 869 41 313 72 041 94 483 99 572 10 000 20 000 30 000 40 000 50 000 60 000 70 000 80 000 90 000 100 000

Trans Hex Group Annual Results Presentation 2016

SOMILUANA AVERAGE GRADE

2012 2013 2014 2015 2016 Average grade 19.16 16.60 23.95 27.99 31.96 5 10 15 20 25 30 35

Trans Hex Group Annual Results Presentation 2016

SOMILUANA DIAMOND PRICES

2012 2013 2014 2015 2016 Price/carat $446 $352 $478 $458 $351 $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500

Trans Hex Group Annual Results Presentation 2016

ANGOLAN OUTLOOK

• In February 2016, mining operations were moved to a new part of

the concession, also located on the east bank of the Luana River. Mining operations and prospecting activities will remain focused here to direct operations to areas of interest.

• External funding is being sought in order to speed up the expansion
• f the production footprint.
• Production results and geological work through drilling and bulk

sampling indicate that carat production for the 2017 financial year will surpass the 99 500 carats achieved in 2016.

Divider Conclusion

Trans Hex Group Annual Results Presentation 2016

CONCLUSION

• South African production for 2017 is expected to be in the order of

41 000 carats.

• Mining operations at West Coast Resources have commenced.

Production for the 2017 financial year is expected to be in the order

• f 123 000 carats.
• Somiluana continues to grow and production for 2017 is expected to

surpass 99 500 carats.

• 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.

www.transhex.co.za

Trans Hex Group Annual Results Presentation 2016

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.