JSE- and NYSE-listed precious metals miner Sibanye-Stillwater reports that it expects profit attributable to the owners of the group to increase by more than 162% year-on-year, to between R24.58-million and R25.08-million for the first half of the year ended June 30.
The miner reported a profit of R9.38-million in the first half of 2020.
As such, Sibanye-Stillwater’s earnings per share (EPS) and headline earnings per share (HEPS), are both expected to increase by more than 138% year-on-year, for the period under review.
The interim EPS and HEPS are expected to be between R8.35 and R8.52, compared with EPS of R3.51 and HEPS of R3.50 reported for the corresponding period in 2020.
The significant increase in profit attributable to owners, basic earnings and headline earnings for the period is mainly attributable to higher production from both the South African platinum group metals (PGMs) and gold operations, following the Covid-19 hard lockdown that impacted the operations in the first half of 2020.
The increase is also attributable to the successful measures implemented to reduce the impact of the ongoing pandemic on production, a higher average PGMs basket price and lower outstanding debt, resulting in a decrease in finance expenses.
However, these increases were partially offset by higher mining and income taxes resulting from increased profitability; higher royalty taxes for the South African operations, mainly attributable to the increase in revenue; and an increase in fair value losses on financial instruments.
In addition, the increases were also impacted on by a loss on initial recognition of the Marikana black economic empowerment (BEE) cash-settled share-based payment obligation, following the Marikana BEE restructure transaction, and a 13% strengthening of the rand to dollar.
During the six months under review, Sibanye recorded platinum, palladium, rhodium and gold (4E) production from its South African PGM operations of 928 992 oz, which was 41% higher than for the comparative period in 2020.
Mined underground 4E PGMs production increased by 43% year-on-year to 817 369 oz, with 4E PGMs production from surface 34% higher year-on-year, at 76 796 oz.
Third-party purchase of concentrate treated at the Marikana smelting and refining operations increased by 29% to 34 827 oz.
Mined platinum and palladium production from Sibanye’s US-based operations during the first half was 298 301 oz, marginally up from the 297 740 oz of the comparative 2020 period. This was the result of a 21-day safety-related work stoppage in June, which reduced production by about 20 000 oz.
Sibanye's recycling increased marginally to 402 872 oz.
Production at the miner’s South African gold operations, including DRDGold, increased by 29% year-on-year to 518 848 oz.