Interim Results Presentation for the six months ended 30 September
AGENDA Financial overview South African operations Angolan operations Namaqualand mines Conclusion Trans Hex Group • Interim Results Presentation
FINANCIAL OVERVIEW Sep-13 Sep-12 Rand revenue (Rm) 259,7 330,7 Cost of goods sold (320,3) (267,6) (Loss)/profit from continuing operations (69,0) 24,9 Profit from discontinued operations 15,2 8,0 (Loss)/profit for the period (53,9) 32,9 HEPS (cents) - total (51,0) 21,5 Cash position (Rm) 294,6 351,7 Net asset value per share (cents) 450 466 Trans Hex Group • Interim Results Presentation
SA PROFIT/LOSS BEFORE TAX Trans Hex Group • Interim Results Presentation
CONTINUING OPERATIONS PROFIT/LOSS AFTER TAX Trans Hex Group • Interim Results Presentation
SA PRODUCTION Trans Hex Group • Interim Results Presentation
LOWER ORANGE RIVER - AVERAGE GRADE Trans Hex Group • Interim Results Presentation
SA DIAMOND PRICES Trans Hex Group • Interim Results Presentation
SA UNIT COST Volume of gravel treated decreased by 14,7% due to a strike and the termination of JV contractor operations. Unit cost increased by 16,3% due to reduced gravels treated and the restarting of stripping operations. Trans Hex Group • Interim Results Presentation
SA OUTLOOK Increased stripping of overburden in the main channel at Baken during the first six months of the year has opened up new blocks for mining in the second half. These blocks are expected to yield higher grades and a higher proportion of special stones than during the first half of the year. South African production for the 2014 financial year is now expected to be approximately 61,000 carats. Rough diamond prices are expected to remain stable during the rest of the 2014 financial year. Trans Hex Group • Interim Results Presentation
SOMILUANA PRODUCTION Trans Hex Group • Interim Results Presentation
SOMILUANA AVERAGE GRADE Trans Hex Group • Interim Results Presentation
SOMILUANA DIAMOND PRICES Trans Hex Group • Interim Results Presentation
ANGOLA OUTLOOK Somiluana is increasing production capacity through internal cash flows. Drilling and sampling is continuing on the east side of the river to maintain current production levels. Carat production for the 2014 financial year is now expected to be at least 60,000 carats. Trans Hex Group • Interim Results Presentation
NAMAQUALAND MINES TRANSACTION Emerald Panther Investments (EPI) was formed to purchase NM. Status of transaction The DMR has formally approved the transfer of the applicable prospecting and mining rights in respect of Namaqualand Mines from DBCM to EPI. All necessary statutory and regulatory approvals required for entering into and implementing the transaction have been obtained. Trans Hex and DBCM have reached agreement on how the State’s 20% interest will be addressed. Trans Hex Group • Interim Results Presentation
NAMAQUALAND MINES TRANSACTION A Special Purpose Vehicle (“SPV”) capitalized by DBCM will hold the 20% interest on behalf of the State or its nominee. The SPV will be a 20% shareholder in EPI. Equity of all EPI shareholders will reduce pro-rata and Trans Hex will therefore hold 40% of EPI’s share capital. Trans Hex will engage directly and expeditiously with the State to agree the manner in which the State will hold its housed 20% interest in NM. Trans Hex will be the operator and receive management and marketing fees totalling 5,5% of sales. Trans Hex Group • Interim Results Presentation
NAMAQUALAND MINES TRANSACTION Funding of transaction EPI has secured funding of R189 million from the Industrial Development Corporation. A rehabilitation insurance instrument approved by the Department of Mineral Resources of R166 million has been secured. Trans Hex’s own direct financial commitment to the NM transaction will now be in the order of R60 million. Trans Hex Group • Interim Results Presentation
CONCLUSION Successfully concluding the acquisition of Namaqualand Mines from De Beers remains a priority for the Group as the assets included in the transaction will add at least 10 years to the life of the South African operations. 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 • Interim Results Presentation
WEBSITE ¡ ¡ ¡ ¡ ¡www.transhex.co.za ¡ Trans Hex Group • Interim Results Presentation
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. Trans Hex Group • Interim Results Presentation
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