Impala Platinum reports 9% drop in half-year profit

Impala Platinum’s Rustenburg operations. Credit: Impala Platinum

South Africa’s Impala Platinum LtdĀ on Tuesday posted a 9% decline in half-year profit, as work stoppages and power outages hit production.

Impala’s headline earnings per share (HEPS) – the main measure of corporate profit in South Africa – fell to 16.90 rand ($1.10) for the half-year that ended Dec. 31 from 18.55 rand a year ago.

The company announced a dividend of 525 cents per share.

Prices of PGMs have come off record highs seen early last year and remained volatile as global growth prospects wavered, raising questions about a sustained up-cycle in PGMs. This has been further exacerbated by rising inflation pressures denting margins of companies.

South African companies have been further impacted by erratic power supply.

Impala said its Rustenburg refinery facilities – one of its biggest operations – had been hit as one of the furnaces had to be completely rebuilt as it broke down due to primarily inconsistent power supply from state-utility Eskom.

This has hurt production and will impact the full year output, which Impala expects to be between 3.1 and 3.2 million ounces, down from 3.27 million ounces the previous year.

($1 = 15.3577 rand)

(By Nelson Banya; Editing by Promit Mukherjee)

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