Anglo Platinum declares R21bn dividend, levers R71bn half-year societal underpin

25th July 2022

By: Martin Creamer

Creamer Media Editor


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JOHANNESBURG ( – Platinum group metals (PGMs) mining and marketing company Anglo American Platinum (Amplats) on Monday declared a gross interim dividend of R21.5-billion from profits accrued during the six-month period ended June 30, when it made a R71-billion economic contribution to society.

The dividend is equivalent to a payout of 80% of headline earnings while the societal economic contribution to society is made up of R6.8-billion in half-year (H1) wages and salaries, and R15.3-billion to local suppliers, including R1.1-billion of this going directly into doorstep communities.

The community spend and dividend payout to the community trust of the Johannesburg Stock Exchange-listed company equated to R350-million and R6.1-billion was invested in the business itself to ensure stability and sustainability. Significant contribution has also been made to the South African and Zimbabwean fiscus through R9.5-billion paid in H1 taxes and royalties, and R33.1-billion paid to shareholders in respect of H2 of 2021.

Full-year metal-in-concentrate production of 3.9-million PGM ounces to 4.3-million PGM ounces and refined production of between 4-million PGM ounces and 4.4-million PGM ounces is guided, with unit cost at R14 000 to R15 000 per PGM ounce, based on an oil price of around $100/bl. Capital expenditure guidance for the full year has been reduced to between R16-billion and R17.5-billion.

The company has felt the impact of higher oil, explosives and chemicals prices, with expenditure on consumables up 18% year-on-year on the back of a 61% increase in oil, 71% increase in chemicals, and a 55% increase in explosives.

“Overall, we’ve seen a 10% increase in mining inflation. However, we’ve been able to contain those costs to around about 8%, so our cash operating costs are up 8% year-on-year, despite those commodity-linked price escalations,” Anglo American Platinum CFO Craig Miller outlined during a media conference in which Mining Weekly participated.

“That’s what we’ll continue to work on in the second half of the year in order to maintain our margins and to continue to ensure that we continue to deliver value for all stakeholders,” Miller added.

In the PGM markets, the forecast is for platinum’s surplus to gradually move towards a deficit owing to a significant increase in automotive platinum demand, as some platinum replaces palladium in gasoline catalysts.

Palladium is likely to move into surplus for the opposite reason, though to what extent will depend on what happens to automotive production. Rhodium should head back into deficit after two years of surplus, the company reported. “Longer-term, we’re excited with the momentum we are seeing in the development of the hydrogen economy and our options to grow and deliver into a transitionary and future decarbonised world.

“With more countries announcing hydrogen-specific strategies, there is more investment committed to broader hydrogen infrastructure and more green hydrogen production, which will enable us to unlock incremental PGMs demand in new segments such as hydrogen production and storage, as well as mobility,” Amplats CEO Natascha Viljoen told the media conference.

While PGM basket prices decreased in the first half, the realised price of $2 671 per PGM ounce is the second-highest average price on record, illustrating the robust underlying market fundamentals for the suite of metals.

This contributed to another strong financial performance, with revenue of R86-billion, earnings before interest, taxes, depreciation and amortisation (Ebitda) of R43-billion, and an Ebitda mining margin of 59% achieved.

The 20% decrease in revenue and 32% decrease in Ebitda was a result of lower sales volumes compared to the prior period, mainly owing to H1 2021 recording the benefit of increased refined production owing to higher-than-normal work-in-progress inventory following the ACP Phase A rebuild.

This strong financial performance enabled the company to contribute to broader society.

Edited by Creamer Media Reporter


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