Implats to post minimum R30bn increase in full-year earnings

IMPALA Platinum (Implats) said basic earnings for the 12 months ended June 30 would come in between R46.5bn and R47.5bn compared to full-year earnings in 2020 of R16.1bn.

This represents an increase of between 189% and 195% for basic earnings and an increase of between 187% and 193% for earnings per share which will be between 5,928 and 6 056 cents per share.

The numbers include the impact of the reversal of impairment losses on property, plant, and equipment and the prepayment of royalties of R10.6bn or 1,351 cents per share recognised in prior periods, the company said.

Headline share earnings are likely to be between 122% and 129% higher coming in between R35.8bn and R36.8bn. Headline share earnings are expected to be between 4,564 cents and 4,691 cents per share.

The headline number will be offset by a charge of R1.5bn, or 193 cents per share arising on the Marula black economic empowerment loan refinancing.

Implats announced in June that full year revenue per 6E platinum group metal (PGM) ounce was 58.8% higher year on year.

The group averaged a PGM oz of R39,478 against a unit cost of R14,000/oz largely owing to record palladium and rhodium prices during the year. It also took advantage of the price spike in ruthenium which it held in inventories, some of which was cleared.

The downside, however, was that Eskom power interruptions and changes to scheduled maintenance owing to Covid-19 disruption resulted in lower destocking of in-process metal inventory than planned, the company said.

Production of gross concentrates was 15.6% higher at 3.29 million oz for the year comprising of a 17.9% increase in output from managed operations (2.37 million oz) and a 10.3% increase in concentrate production (561,000 oz) from its joint ventures.

Production of refined PGMs, including oz from the firm’s Canadian operations bought in the 2020 financial year, increased 16.3% to 3.27 million oz. Implats previously issued guidance for this year of 3.2 to 3.5 million oz in group refined production.

Sales totalled 3.27 million oz.