JOHANNESBURG (miningweekly.com) – South African ferrochrome producer Merafe Resources is set to report lower profit when it publishes its 2011 financial results on March 6.

The company, which operates in a joint venture (JV) with Xstrata, said on Wednesday its headline earnings a share would be between 6c and 7c for the year ended December 31, compared with 11c in the comparative period.

Basic earnings a share would be between 5c and 6c, down from 11c in 2010.

The company also reported that it had signed agreements with Absa Capital in December to secure a long-term debt facility of R800-million, which includes refinancing of its existing R300-million long-term debt and funding for Project Lion II.

The expansion of the ferrochrome complex will involve the construction and commissioning of a 360 000 t/y capacity smelter, in Steelpoort, in Limpopo, and will increase the Xstrata-Merafe chrome JV's total ferrochrome capacity to over 2.3-million tons a year.

Merafe closed the financial year with a cash balance of R220-million.
 

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