Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : SOUTH AFRICAN MINING -- Ignore unavailable to you. Want to Upgrade?

To: sea_urchin who wrote (331)	10/6/1998 10:00:00 PM
From: POLARBEAR	Respond to of 472

Searle, Thank you for your kind words on my spreadsheet work. Glad someone besides me could decipher it all ! :) Big thanks for directing me to this article. I had to work to get it off their server! 06 October 1998 Kebble launches revamped gold companies David McKay JCI Gold deputy chairman Brett Kebble put a tumultuous period in control of JCI's gold assets behind him yesterday when he launched his two revamped gold mining companies, Western Areas and Randfontein Estates. Laying out their respective stalls, Kebble said the two companies were independent, would be run as businesses rather than just mines, and the companies hoped to resume dividend payments. The creation of Western Areas and Randfontein Estates as independent companies follows the near extinction of JCI after the break up of Kebble and business partner Mzi Khumalo. Analysts were cautious, however, as possibly lower value assets, such as Randgold Resources, might be wrapped into the group. This could follow the yet-to-be-completed merger of JCI Gold with Consolidated African Mines (CAM), one of Kebble's companies, which together will comprise the largest stakeholder in Western Areas and Randfontein Estates. Kebble said a deal to include Randgold Resources in the JCI Gold structure was not on the table. He told investors he would only pursue "earnings-enhancing assets". The merger of CAM with JCI Gold was "nearly imminent", he said. In presenting the improved operations and growth plans of the two firms, Kebble said Western Areas and Randfontein Estates were targeting different investors. In essence, Western Areas is the quality investment and Randfontein Estates a highly-geared share. Both would pay back investors in about five years, he said. They had changed their names - The Randfontein Estates Gold Mining Company Witwatersrand Ltd has been renamed Randfontein Estates - to enforce stronger branding. This had cost the group "a couple of hundred thousand rands", Kebble said. Reporting handsome increases in annual headline earnings, Western Areas and Randfontein Estates would do enough to trigger a share rerating, Kebble said. Western Areas would be spared buying in replacement reserves in the short term because of its South Deep project which stood to double gold production to 750 000oz a year by 2003. Yet it would make "highly selective and carefully considered acquisitions at a time of its choosing", Kebble said. Amid an $81/oz decrease in cash costs to $274/oz, Western Areas reported a 408% increase in headline earnings to 249c a share in the year to June. Randfontein Estates posted a similarly large increase in headline earnings, on more than a third higher gold output. Part of Randfontein Estates' strategy was to seek surface, dump and shallow underground operations "which do not have the critical mass to support their own plants," he said. The two companies also gave strong indications of their performance in the September quarter. Although the companies' books had not closed, Randfontein made an estimated operating profit of R61m (June: R52m) and Western Areas improved its operating profit to R182m (R171m). Given the rand's depreciation and small recovery in the bullion price, these results were not outstanding, one analyst said.