JOHANNESBURG (miningweekly.com) – Diversified black-led mining company African Rainbow Minerals (ARM) on Friday announced a 15% increase in headline earnings for the six months to December 31, to R1 945 million.
This increase was mainly as a result of improved headline earnings from the manganese division, ARM Coal, Modikwa platinum mine and ARM Copper.
The company, headed by executive chairperson Patrice Motsepe, has declared an interim dividend of 250c a share for the six month, totalling R549-million.
Basic earnings were R1 753-million, compared with a first half loss of R254-million on impairment of R711-million at Nkomati nickel mine and R734-million at Modikwa platinum mines.
Higher dollar prices were realised for all commodities in ARM's portfolio except iron-ore, platinum and chrome concentrate.
Disposal of ARM and Vale's 80% interest in Lubambe copper mine in Zambia has been completed, ARM's interest in Two Rivers platinum mine has increased to 54%.
Cash dividends received from the Assmang joint venture were R1 000-million and since the period end, ARM received a cash dividend of R2 000-million from Assmang.
Net debt has been sharply reduced to R1 102-million from R3 508-million in the same period of 2016.
ARM Ferrous headline earnings were 26% higher at R1 765-million and platinum headline earnings increased by 26% to R226-million as Modikwa improved from a headline loss of R54-million in the first half to headline earnings of R36-million in the second half.
Two Rivers' headline earnings were 16% lower at R173-million on a grade-hit fall in platinum group metals volumes.
Nkomati mine reported reduced headline earnings on lower shipment-hit sales volumes.
Chrome concentrate sales volumes at Nkomati rose 105%, but the average dollar price realised for chrome concentrate was 62% lower.
ARM Coal headline earnings were R160-million, up on the R99-million of the first half, with the Goedgevonden coal mine contributing R35-million, up on the R26-million headline loss of the first half.
Participating Coal Business (PCB) operations headline earnings were flat at R125-million while ARM Copper reported a headline loss of R6-million, down on the prior R72-million headline loss.
ARM Corporate and ARM Exploration showed an improved headline loss of R200-million.
Iron-ore sales volumes were 4% higher at a record 9.1-million tonnes, with the rail link established from Beeshoek mine to the Saldanha Export Channel creating additional flexibility.
Manganese ore sales volumes increased by 10% to 1.6-million tonnes, with 1.5-million of those tonnes exported.
Production volumes at Black Rock mine increased by 43% as the Nchwaning II shaft returned to full production.
Total manganese alloy sales volumes rose 17% to 162 000 t as the Sakura Ferroalloys Project in Malaysia ramped up. Manganese alloy production at Sakura increased from 68 000 t to 122 000 t as both furnaces became fully operational.
At Cato Ridge Works in KwaZulu-Natal, alloy production increased by 2% to 68 000 t.
Machadodorp Works is currently only recovering ferrochrome from the slag dump through the metal recovery plant and will start to recover ferromanganese from the slag dumps.
At Beeshoek, the capital expenditure (capex) was R182-million on mainly waste rock removal. Khumani mine's capex was R426-million on mainly waste stripping at the King Pit, infill drilling and replacement of mining equipment.
At Black Rock, capex was R540-million on mainly project development, fire protection, finalising the construction of the Hotazel Rail Link line and replacement of mining equipment.