Northam Platinum posts profit dip as costs surge

Northam Platinum posts profit dip as costs surge
Zondereinde, the world’s deepest platinum mine. (Image courtesy of Northam Platinum.)

South Africa’s Northam Platinum on Friday reported a 2.9% dip in full-year profit despite record production, citing lower metal prices and surging costs.

Northam’s headline earnings per share (HEPS) – the main profit measure in South Africa – was 26.11 rand ($1.56) in the year to June 30, down from 26.88 rand the previous year.

The company’s output rose 3.7% to a record 716,488 platinum group metal (PGM) ounces, up from 690,867 ounces previously, despite two mining-related fatalities, covid-19 induced absences and community unrest that affected its Booysendal operations.

However, increases in the price of chemicals, steel components, explosives and fuel drove Northam’s production costs 18.9% higher.

Northam, which is in a bidding war with larger rival Impala Platinum for the acquisition of mid-tier PGM miner Royal Bafokeng Platinum, did not declare a dividend, saying it was at a “critical juncture” on its growth path.

($1 = 16.7893 rand)

(By Nelson Banya; Editing by David Goodman)

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