(ELR) Eastern Platinum

Any time soon - 43p short term target - to fill the gap

Eastern Platinum - Solid Q311 numbers Click for report
Wed, Nov 16, 2011 at 10:15 AM
http://www.edisoninvestmentresearch.co.uk/researchreports/Eastplats161111update.pdf

Eastplats released solid Q311 financial results supported by the recovery in PGM sales and corresponding cost normalisation. With an 18% increase in revenue and 8% reduction in cash production cost, the company managed to break even on EBITDA that came in at $0.4m. While maintaining high production levels is important, we note that lower PGM prices and production disruptions may have an adverse impact on the company’s performance in Q411. That said, we believe this is already priced in by the market as the stock has underperformed the commodity basket.

Eastern Platinum is a mid-tier platinum group metals (PGM) producer on the Bushveld Complex. It has an 87.5% interest in the Crocodile River Mine, which it operates on the western limb. It has four development projects on the eastern limb: Mareesburg (75.5%), Spitzkop (93.4%), DGV (87.5%) and Kennedy’s Vale (87.5%).

Year
End Revenue
(US$m) PBT
(US$m) EPS
(c) DPS
(c) P/E
(x) Yield
(%)
12/09 111.4
0.2
0.9
0.0
73.8
N/A
12/10 155.0
10.3
1.9
0.0
34.9
N/A
12/11e 141.5
(14.8)
(0.9)
0.0
N/A
N/A
12/12e 253.9
38.7
2.3
0.0
28.9
N/A
Eastern Platinum is a research client of Edison Investment Research.

DJ Eastern Platinum Eastern Platinum Reports Results for the Three Months Ended September 30, 2011

TIDMELR

Eastern Platinum Reports Results for the Three Months Ended September 30, 2011 FOR: EASTERN PLATINUM LIMITED

TSX, AIM SYMBOL: ELR

JSE SYMBOL: EPS

November 14, 2011

Eastern Platinum Reports Results for the Three Months Ended September 30, 2011

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 14, 2011) - Eastern Platinum Limited ("Eastplats") (TSX:ELR)(AIM:ELR)(JSE:EPS) reports financial results for the three months ended September 30, 2011.

Summary of results for the three months ended September 30, 2011 ("Q3 2011"):

/T/

=- Eastplats recorded earnings attributable to equity shareholders of the Company of $1,364,000 ($0.00 per share) in the quarter ended September

30, 2011 ("Q3 2011") compared to earnings of $4,039,000 ($0.01 per

share) in the quarter ended September 30, 2010 ("Q3 2010").

=- EBITDA decreased to $2,912,000 in Q3 2011 compared to $11,120,000 in Q3 2010.

=- PGM ounces sold decreased 29% to 26,955 ounces in Q3 2011 compared to 37,798 PGM ounces in Q3 2010.

=- The U.S. dollar average delivered price per PGM ounce increased 14% to $1,088 in Q3 2011 compared to $953 in Q3 2010.

=- The Rand average delivered price per PGM ounce increased 12% to R7,768 in Q3 2011 compared to R6,966 in Q3 2010.

=- Total Rand operating cash costs increased 3% to R204 million in Q3 2011 compared to R197 million in Q3 2010.

=- Rand operating cash costs net of by-product credits increased 34% to

R6,097 per ounce in Q3 2011 compared to R4,566 per ounce in Q3 2010.

Rand operating cash costs increased 45% to R7,561 per ounce in Q3 2011

compared to R5,212 per ounce in Q3 2010.

=- U.S. dollar operating cash costs net of by-product credits increased 37% to $854 per ounce in Q3 2011 compared to $625 per ounce achieved in Q3

2010. U.S. dollar operating cash costs increased 49% to $1,059 per ounce

in Q3 2011 compared to $713 per ounce in Q3 2010.

=- Head grade increased to 4.1 grams per tonne in Q3 2011 from 4.0 grams per tonne in Q3 2010.

=- Average concentrator recovery decreased to 78% in Q3 2011 compared to 81% in Q3 2010.

=- Development meters increased by 21% to 3,976 meters and on-reef

development increased by 25% to 2,248 meters compared to Q3 2010.

=- Stoping units decreased 20% to 40,594 square meters in Q3 2011 compared to 50,892 square meters in Q3 2010.

=- Run-of-mine ore hoisted decreased by 27% to 265,889 tonnes in Q3 2011 compared to 362,042 tonnes in Q3 2010.

=- Run-of-mine ore processed decreased by 27% to 261,280 tonnes in Q3 2011 compared to 357,219 tonnes in Q3 2010.

=- The Company's Lost Time Injury Frequency Rate (LTIFR) improved to 1.66 in Q3 2011 compared to 4.66 in Q3 2010.

=- At September 30 2011, the Company had a cash position (including cash, cash equivalents and short term investments) of $267,164,000 (December

31, 2010 - $350,292,000).

/T/

The qualified person having reviewed the operating disclosures presented in this press release is Mr. Brian Montpellier, P. Eng, V.P. Project Development.

Financial Information

For complete details of financial results, please refer to the unaudited condensed consolidated interim financial statements and accompanying Management's Discussion and Analysis ("MD&A") for the three months ended September 30, 2011. These financial statements and MD&A, and the comparative unaudited condensed consolidated interim financial statements for the three months ended September 30, 2010 are all available on SEDAR at www.sedar.com and on the Company's website www.eastplats.com.

Teleconference call details

Eastplats will host a telephone conference call on Monday, November 14, 2011 at 10:00 am Pacific (1:00 pm Eastern) to discuss these results. The conference call may be accessed by dialing 1-800-319-4610 in Canada and the United States, or 1

7:21 am

http://bit.ly/ru78t4

Broker Views:

Max Petroleum: Barclays Capital maintained an Overwt/Positive rating on the stock, with a target price of 45.00p

BowLeven: Barclays Capital maintained an Overwt/Positive rating on the stock, with a target price of 305.00p

Eastern Platinum Ltd: Canaccord Genuity Corp maintained a Buy rating on the stock, with a target price of 104.33p

Rockhopper Exploration: Macquarie initiates the stock with Outperform rating and a target price of 428.00p

Big Yellow Group: Barclays Capital initiates the stock with Overwt/Neutral rating and a target price of 388.00p