[miningmx.com] — KUMBA Iron Ore , a unit of global miner Anglo American, reported a rise in full-year profit on Thursday, boosted by higher iron ore prices and said it expects export volumes to rise in the current financial year.
Kumba, Africa’s largest producer of the steelmaking ingredient, said full-year diluted headline earnings per share totalled R52.99, compared with R44.54 a year earlier.
Headline EPS, the main profit measure in South Africa, excludes some one-time items.
Africa is regarded by many in the industry as the next iron ore frontier with many global miners moving to cash in on the projected rise in demand for steel from Asia.
Kumba, the world’s 10th largest producer of iron ore, said production dropped 5% to 41.3 million tonnes (Mt) on the back of feedstock constraints at the company’s Sishen mine.
Export sales rose 3% to 37.1Mt and would rise by around 3Mt in the current financial year as the company’s Kolomela mine ramps up output.
Kolomela is on track to produce between 4Mt and 5Mt of iron ore this year, before ramping up to full capacity of 9Mt by 2013.
The company declared a final cash dividend of R22.50 per share.
Kumba said the medium to long-term outlook for iron ore demand remained robust on the back of infrastructure developments in China.
Short-term iron ore supply is expected to remain tight given weather problems in Brazil and Australia, and India’s moves to control exports.
“Ongoing challenges producers face in delivering new supply will lead to increasing capital intensity and underpinned long-term pricing outlook,” Kumba said in a statement.
Kumba’s shares are up 8.8% so far this year, compared with a 6.42% rise in the JSE Top-40 blue chip index .
