Business has a right to profit – Griffith

4th February 2013

By: Natalie Greve

Creamer Media Contributing Editor Online


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JOHANNESBURG ( – Anglo American Platinum (Amplats) CEO Chris Griffith told Mining Weekly Online that, while he acknowledges the pressures on government and labour, a private business should be allowed to operate in a manner that would allow it to realise a profit.

“While we have to have the right, as a company, to do what is necessary to be profitable, we also want to do it in a way that is conscious of the people it impacts,” he added on Monday.

Despite early stage consultative engagements between Amplats, labour unions and the Department of Mineral Resources (DMR), Griffith said no viable alternative to the restructuring drive that would see the loss of some 14 000 jobs under Section 189 of the Labour Relations Act, had been presented yet.

“There are no options on the table as yet,” he said.

He added that, should alternatives to its proposed restructuring be presented, it would occur far later in the engagement process, but added that he doubted that it would culminate in a viable alternative that would return the miner to profitability.

“We maintain that our response to structural industry challenges was not a knee-jerk one, but we will remain open to other options,” Griffith said.

He added that government indicated it had taken issue with the fact that it had not been adequately consulted prior to the company’s market announcement.

The first stage of the consultations, which saw Amplats agreeing to a 60-day delay in implementing the Section 189 action, saw the platinum miner sharing the fundamental drivers of its decision to restructure.

As the process progressed and further information was requested by labour and the DMR, it would be presented, Griffiths said.

He added that 30% of the 14 000 proposed retrenchments would be employed elsewhere within the Anglo American group and that a current moratorium on all new hires was in place.

Earlier on Monday, the company reported an operating loss of R6.34-billion for the year ended December 31, representing a 180% reduction from a profit of R7.96-billion in 2011.

Headline earnings per ordinary share decreased year-on-year to a loss of R5.62 in 2012 from a profit of R13.65 reported in 2011 on the back of lower sales volumes, high mining-related cost inflation and lower realised metals prices.

Platinum sales for the period were lower primarily owing to the two-month illegal industrial action experienced during the second half of the year, which resulted in lost production of some 305 600 oz of equivalent refined platinum.

The company reported an 8% decrease in equivalent platinum production year-on-year to 2.2-million ounces.

Looking ahead, Amplats believed the global platinum market would likely be balanced in the short term as a result of reduced production, owing to the company’s proposed portfolio review and possible supply disruptions.

“If South African platinum production returned to pre-strike levels, the market would be oversupplied,” the company stated.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online


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