Lonmin sales up 30 percent

Lonmin plc, the world's third-biggest platinum producer, posted a 30 percent rise in second-quarter platinum sales, helped by processing a backlog, and completed a US$575 million debt refinancing package. ┬á  The 30 percent jump in refined platinum sales of 185,651oz in the three months to end March, higher than Investec's forecast of 150,000oz, was due to better performance at its flagship Marikana mine and processing of inventories."The Process Division delivered an excellent performance during the second quarter and, ahead of our expectations, it processed the vast majority of the inventory built up during the planned re-build of the Number One furnace," Lonmin said in a statement. The company is 25 percent owned by mining group Xstrata and has been seeking to gain credibility under new management after repeated cuts in sales targets in recent years. The debt refinancing consisted of a US$250 million revolving credit facility and a US$150 million amortizing term loan in the UK, both maturing in November 2012, and a US$175 million revolving credit facility in South Africa, maturing in November 2010. "This refinancing significantly lengthens the tenure of the company's banking facilities," said Lonmin.┬á The company, which owns mines in South Africa, said it had largely completed restructuring its Limpopo and Marikana operations -- closing some high-cost areas and cutting costs to survive a market downturn. ┬á  "Today's numbers give us some confidence that an improving trend is emerging on the production side of things and the market will now be watching closely to see how that trend is reflected in unit costs... The immediate balance sheet issues have also been addressed," a note said.