[miningmx.com] – NORTHAM Platinum has lost R500m in revenue as a strike over wages staged by the National Union of Mineworkers (NUM) entered its third month, the company said. Total employee losses in wages had topped R100m.
In a statement to the Johannesburg Stock Exchange, Northam said the NUM’s demands, which include an average increase of 16% in wages and 69% increase in the living out allowance “… remain unaffordable for the company”.
It added that the demands were “out of kilter” with the settlements reached in the gold sector and at other platinum producers. Shares in the company edged down slightly and still offered a 5% 12-month return despite the effects of the strike.
Northam said it would seek a meeting with the NUM which would be under the auspices of the Council for Conciliation, Mediation and Arbitration (CCMA). “Shareholders will be kept informed of progress,” it said.
Revenue losses in December would have been ameliorated by the fact that Northam normally doesn’t produce platinum for about 10-days over the holiday period. The daily revenue loss is about R14m per day.
However, the picture may change owing to the improvement in the platinum price since about mid-December and weakness in the rand which at R10.69 to the dollar is edging towards a five-month low.
Northam is financed to survive the strike after it raised R600m in a rights offer last year. It also announced on December 12 that it had secured some R400m in a short term revolving credit facility and a convenant holiday on debt convenants.
