Merafe to return to the black

[miningmx.com] — SOUTH African ferrochrome producer Merafe Resources said on Thursday it expected to report a return to black for the six months to the end of June after it boosted production on the back of rising demand.

The company said it expects to report first-half headline earnings per share of between seven and eight cents, up from a headline loss per share of three cents last year.

Headline earnings are the main profit gauge in South Africa and strip out certain one-off and non-trading items.

Merafe last year reported a first-half headline loss owing to low international ferrochrome prices, a firmer rand and lower output due to the economic downturn.

Demand for ferrochrome, used in stainless steel to prevent corrosion, slumped during the economic crisis, forcing companies in top producer South Africa to cut on output.

Merafe’s joint venture with Xstrata has since restarted most of its furnaces when the market began to turn in the third quarter of last year.