JOHANNESBURG – Bad news from South Africa’s platinum belt has pushed shares of the world’s No. 2 producer of the metal to the lowest since 1999.

Impala Platinum Holdings has dropped 40% this year as investors fret over glitches at its Rustenburg operations and cost ratios that compare unfavorably with some peers. The biggest producer after Anglo American Platinum on April 26 cut its production forecast for this year by about 3% and said it’s taking steps to improve output and cost performance.

Some investors are pricing in a profit warning and a potential capital raising by the miner, known as Implats, said Ryan Seaborne, a money manager at 36One Asset Management in Johannesburg. “They have cut guidance by 100 000 oz to 560 000 oz for full year 2018 and this is only a few months after they already lowered guidance,” he said, referring to the Rustenburg operations in South Africa’s northwest.

The reduced production at Rustenburg could mean Implats has reached its break-even rate and the “operation is sailing close to the wind,” Rene Hochreiter, an analyst at Noah Capital Markets, said in an April 26 note. In rand terms, platinum prices have dropped by about 15% since mid-November.

The company shut a shaft at Rustenburg in January, flagged three more to be closed once mined out and fired 1 400 workers. While the miner has closed ten shafts since 2013, some investors aren’t convinced the company has contained its cost crunch.

“Net debt to Ebitda has been creeping up to double and could breach that level soon,” Seaborne said. Most South African peers, excluding Sibanye Gold, operate a ratio of less than 1:1, he said.

Implats has attracted the attention of short sellers, who bet on declines in stocks. AS of May 9, the short interest in Implats as a percentage of shares outstanding is 9.8%, Markit data show, making the platinum miner the most-shorted stock among members of South Africa’s benchmark index.

Implats spokespersonn Johan Theron said he couldn’t speculate on actions taken by investors, but said the company had noted an increase in short positions following a sale of 2022 convertible bonds. “One would naturally expect some convertible bond holders to cover their equity exposure through short positions,” he said by email. “As to the impact that this has on the present combined short position relative to say the recent drop in metal prices, is obviously difficult to assess.”

Implats fell 1.9% Wednesday, declining for a fifth day. The stock is the worst performer among the five members of a Johannesburg index of platinum producers, which has dropped 22% in 2018.