Patrice Motsepe
Photo by: Creamer Media
JOHANNESBURG (miningweekly.com) – The earnings of black-owned diversified mining company African Rainbow Minerals (ARM) were buoyed in the six months to December 31 by soaring platinum earnings, which helped to offset lower manganese metals and thermal coal prices.
ARM Platinum’s half-year headline earnings rocketed 193% to R489-million and along with higher iron-ore prices shielded the JSE-listed ARM group from the decline in the prices of manganese ore, manganese alloy and coal.
The company, headed by executive chairperson Patrice Motsepe, generated R140-million more operational cash to R92-million, despite a R1 280-million increase in working capital requirements.
An interim dividend of 500c a share was declared, up on the first half’s 400c a share.
Dividends received from the Assmang joint venture with Assore were a higher R2 000-million and capital expenditure (capex) for the period was R492-million, all of it sustaining capex.
Three employees were fatally injured in separate accidents Mpedi Ishmael Malatji, a load haul dump operator, at Two Rivers platinum group metals mine, Makoti Marks Tshwale, a water truck operator at Nkomati nickel mine, and Simon Sandamela at Tweefontein coal mine.
Two Rivers and Modikwa platinum mines doubled headline earnings on 9%-higher platinum, 58%-higher palladium and 97%-higher rhodium prices. Modikwa benefited from its nigh-equal platinum to palladium ratio.
Installation of 40 000 t/m additional milling capacity at Two Rivers is expected to increase production volumes beyond 360 000 oz/y.
ARM noted in a release to Mining Weekly that headline earnings for ARM Ferrous were 13% lower at R1 848-million as the 16% increase in the iron-ore division was more than offset by the 52% decline in the manganese division.
Iron-ore's improved profitability was helped by better-than-expected steel production in China. Conversely, manganese ore prices declined sharply as increased seaborne supply put prices under pressure.
The negative impact of lower manganese ore prices on headline earnings was partially offset by a 13% increase in export sales volumes as the ramp-up of Assmang’s Black Rock mine, in the Northern Cape, progressed on schedule and within budget.
Jongisa Magagula has been appointed as ARM executive director for investor relations and new business development.