Precious metals mining company Sibanye last week reported a record operating profit of R10.5-billion for the six months and year ended December 31, 2016, a 60% increase on the previous year.

Group operating profit of R5.1-billion for the second half of 2016 was 29% higher than for the comparable period in 2015, with the gold division contributing R4.8-billion and the platinum division adding R304-million, including a positive R74-million contribution from Rustenburg for November and December 2016.

Sibanye’s 50% joint venture in the Mimosa platinum mine, in Zimbabwe, which is equity accounted and, therefore, not included in operating profit, contributed a further R186-million profit, the company said in a release to Creamer Media’s Mining Weekly.

Normalised earnings increased by 52%, compared with the same period in 2015, to 163c a share, and normalised earnings of 397c a share for the 12 months to December 31 were 196% higher year-on-year.

Precious metals mining company Sibanye last week reported a record operating profit of R10.5-billion in the 12 months to December 31, when headline earnings soared 269% to R2.5-billion year-on-year.

The final dividend of 60c a share, amounting to R560-million, is equivalent to 37% of normalised earnings, taking the total dividend for the year ended December 31 to 145c a share.

“It is pleasing to report such solid financial results and again be able to deliver an industry-leading dividend yield of over 5% to our shareholders,” Sibanye CEO Neal Froneman commented, adding that the positive contribution from the platinum division was notable, with the Aquarius assets continuing to operate well and the Rustenburg operations showing a solid turnaround and returning to profitability.

Operating Performance

Total gold production of 23 805 kg, or 765 400 oz, from Sibanye’s gold division for the six months under review, was 7% lower than for the comparative period in 2015, primarily due to the cessation of underground mining at Cooke 4 mine.

Lower production impacted on unit costs, with the all-in sustaining cost increasing by 10% to R451 352/kg, or $1 005/oz, year-on-year.

The platinum division delivered attributable platinum-group-metals production of 327 990 oz of four element material for the six months ended December 31. Operating costs for the division were well managed, resulting in an 11% average operating margin.