Profile

Business of the company
Impala Platinum Holdings Limited ("Implats/the company") is principally in the business of producing and supplying platinum group metals (pgms) to industrial economies. The company’s holdings in various mining and exploration activities are described below:

Capital

Authorised capital
The company’s authorised share capital of 100 000 000 ordinary shares of 20 cents each remained unchanged during the year.

Issued capital
During the year 264 475 new ordinary shares were issued in terms of the Implats share incentive scheme and 17 010 new ordinary shares were issued to individual mineral right owners in terms of an amendment to the mining lease agreements. Following these allotments the issued capital of the company comprises 66 347 625 ordinary shares of 20 cents each (2000: 66 066 140).

Unissued share capital
In terms of a resolution passed at the last annual general meeting, the unissued share capital is under the control of the directors until the forthcoming annual general meeting. Shareholders will be asked to consider a resolution renewing this authority. The proposed resolution is set out in the notice convening the annual general meeting.

Share incentive scheme
At 30 June 2001 the Implats Share Purchase Trust held 38 700 unallocated shares. No shares were allocated or released during the year.

Share option scheme
The directors are authorised to issue, allot or grant options to acquire up to a maximum of 2 177 000 ordinary shares in the unissued share capital of the company in terms of employee share options schemes. Details of participation in the share option scheme are set out in Note 25 of the financial statements.

Shareholding in the company
The issued capital of the company is held by public and non-public entities as follows:

Gencor Limited holds 30.6 million shares in the company (46.1 per cent). No other shareholder beneficially holds more than five per cent of the issued share capital.

Investments

Winnaarshoek
The company acquired the Winnaarshoek mineral rights from Platexco Inc, a Canadian listed company for a consideration of C$191million (R950 million). An integral part of the transaction was to acquire the rights to mine the adjacent properties including Clapham and portions of Driekop and Forest Hill.

A 20% participation in the project has been awarded to black empowerment partners as described in post balance sheet events.

The group is in the process of establishing a 175 000 platinum ounce per annum mine which is expected to commence production in December 2003.

Aquarius Platinum Limited
The company holds a 10.1% interest in Aquarius Platinum Limited ("Aquarius") purchased for a cash consideration of approximately R29.1 million. Aquarius increased its shareholding in Kroondal from 45% to 94.3% by means of a cash offer of R32 per share to Kroondal minority shareholders. Kroondal shares were delisted from the JSE as a result of the transaction.

Aquarius Platinum SA Limited
Implats acquired a 25.5% interest in Aquarius Platinum (SA) Limited in exchange for the mineral rights in respect of the Everest South, a portion of Everest North and Chieftains Plain projects. Aquarius SA is currently developing the Marikana platinum project which is expected to come into production in December 2001, producing some 150 000 ounces of pges per annum. Impala has undertaken to refine platinum concentrates from the projects.

Kroondal Platinum Mines Ltd
The company has acquired an additional 500 000 shares in Kroondal in terms of an underwriting agreement with Aquarius. The company’s direct holdings in Kroondal were diluted to 4.7% (2000: 5.8%) by the conversion of Kroondal options to ordinary shares. Due to the company’s direct shareholding in Aquarius the effective interest of the company in Kroondal’s operations is 14.2%. Subsequently, Kroondal has been delisted.

Brandrill
Implats hold a 6.4% interest in Brandrill Limited. Brandrill is developing penetrating cone fracture (PCF) technology which is an effective means of rockbreaking and is suited to continuous mining due to the minimal toxic fumes. Impala has entered into a co-operation agreement with Brandrill governing the use of PCF technology.

Philippines
Implats entered into an agreement with Philnico Development Limited to conduct a feasibility study on the Nonoc Island Surigo del Norte in the Philippines. The feasibility study has been completed and a leading partner for the project is being sought by the sponsor.

Financial affairs

Results for the year
The results for the year are fully dealt with in the financial statements forming part of the annual report.

Accounting policies
During the year certain changes were made to the group’s accounting policies, to comply with International Accounting Standards ("IAS"). Details of the new accounting policies and the effect of the changes are set out on the accounting policies page.

Dividends
An interim dividend (No 66) of 1 420 cents per share was declared on 8 February 2001, a special dividend of 3 000 cents per share was declared on 7 February 2001 and a final dividend (No 67) of 2 380 cents per share was declared on 23 August 2001, payable on 4 October 2001 a total of 6 800 cents per share (2000: 1 760 cents per share). These dividends amounted to R4 509 million of the year (2000:R1 166.7 million).

Capital expenditure
Capital expenditure for the year amounted to R 2 090 million (2000: R783 million).

The estimated R2 billion capital expenditure by Impala envisaged for the 2002 financial year will be funded from internal resources and, if appropriate, borrowings.

Going concern
The financial statements have been prepared using the appropriate accounting policies, supported by reasonable and prudent judgements and estimates. The directors have a reasonable expectation that the group has adequate resources to continue as a going concern in the foreseeable future.

Associated and subsidiary companies
Information regarding the company’s associated companies and subsidiaries are given in note 13 and Annexure A respectively to the financial statements.

Property
Details of the freehold and leasehold and buildings of the various companies are contained in registers, which are available for inspection at the registered offices of those companies.

Post balance sheet events

Zimplats
The company has entered into an agreement with Zimplats in terms of which the company acquires a 30% interest in Zimplats’ Hartley Management Company (Pvt) Limited, which comprises the Ngezi open-cast mine and the Hartley joint venture, for an expected consideration of R240 million (US$30 million).

In addition, the company together with ABSA Bank Limited ("ABSA") have purchased a 30% equity stake in Australian-listed Zimplats for a consideration of R131 million (US$16.3 million). The equity stake is held by Impala Platinum (Zimbabwe) (Pty) Limited in which ABSA holds a 49% interest and the company holds a 51% interest.

The fully diluted interest of the group in Zimplats is 40%. The Ngezi project is situated some 75 kilometres from the Hartley Metallurgical complex and a feasibility study has indicated a 100 000 ounce per annum platinum mine over a 20 year life.

The group advanced a loan of R70.6 million to Hartley Management Company (Pvt) Limited in anticipation of the conversion into share capital. Refer to note 15.

Mimosa
The company acquired a 35% interest in ZCE Platinum Limited which wholly owns Mimosa for a consideration of US$30 million. The contribution will be used to fund an expansion of the mine from 16 000 to approximately 68 000 ounces of platinum per annum.

Two Rivers Platinum
The company has entered in to a joint venture agreement with Anglovaal Mining Limited ("Avmin") to develop a 100 000 ounce platinum mine of the farm Dwars Rivier in Mpumalanga province. The Dwars Rivier mineral rights on both the UG2 and Merensky reefs will be acquired from Associated Manganese Mines of South Africa Limited for a consideration of R551 million. The joint venture, Two Rivers, to develop, manage and operate the new mine will be held 55% by Avmin and 45% by the company.

Winnaarshoek
On 11 July 2001 it was announced that Mmakau Mining would acquire 10% of the Winnaarshoek project, while a further 10% would be taken up by empowerment participants in the Northern Province. Funding for the acquisition by the partners is still under negotiation.

No other material events have occurred since the date of these financial statements and the date of approval thereof, the knowledge of which would affect the ability of the users of these statements to make proper evaluations and decisions.

Directorate

Composition of the Board
During the year Mr SV Kearney resigned as a Chief Executive Officer of the company and
Mr JG Smithies was appointed in his stead. Subsequent to the year end Mr JG Smithies retired and Mr KC Rumble was appointed as director and Chief Executive Officer. Members will be asked to confirm this appointment at the forthcoming annual general meeting.

The directors who retire at the next general meeting are Mr DH Brown, Mr PG Joubert,
Mr DM O’Connor and Mr MF Pleming; being eligible they offer themselves for re-election.

Interest of directors
The interests of directors in the shares of the company were as follows and did not individually exceed 1% of the issued share capital or voting control of the company. The board contains seven non-executive directors, of whom one director is also a director of the major shareholder, and three executive directors.

There were no contracts of significance during or at the end of the financial year in which the directors of the company were materially interested.

No material change in the aforegoing interests has taken place between 30 June and the date of this report.

Directors’ fees
In terms of the Articles of Association the fees for services as directors are determined by the company in general meeting. Director’s fees for services as a director are currently R80 000 per director with an additional amount of R40 000 for the Chairman. At the forthcoming annual general meeting, it will be proposed to increase directors’ fees to R90 000 per annum with an additional amount of R45 000 for the chairman. The increase takes into account inflation since the last review of directors’ fees two years previously. Directors serving on board committees are paid R20 000 per annum as members of a committee and the Chairman of the committee receives R30 000 per annum. These fees have been waived by the executive directors.

Administration

Special resolution
At the last annual general meeting the articles of association were amended by special resolution to take cognisance of the electronic settlement and transfer of shares and to allow the company to acquire its own shares.

Financial, administrative and technical advisers
In terms of a service agreement, Impala Platinum Limited acts as financial, administrative and technical advisors to the Implats group during the year on a fee basis. Messrs D H Brown, P G Joubert, J M McMahon, K C Rumble, J G Smithies and Ms C E Markus had an interest in this contract to the extent that they are directors of Impala and of the company, but they do not beneficially own any shares in Impala.


Secretaries
Mr. A M Snashall acted as Secretary to Implats and Impala, and Impala acted as Secretaries to other subsidiaries in the Implats group. The business and postal addresses of the Secretaries are set out on page 116.

London Secretaries
The business and postal addresses of the London Secretaries are set out on page 116.

Public Officer
Mr J van Deventer acted as public officer for the group for the year under review.

Directors’ remuneration
The directors remuneration for the year under review was in aggregate as follows: