Implats to slash 3 900 jobs on weak PGM prices

ABOUT 3,900 jobs are on the line at platinum group metals (PGM) miner Implats as weak platinum prices and input cost pressures have forced it to consider retrenchments, it said today. This number represents about 9% of the workforce at Impala Rustenburg, Impala Bafokeng and Marula, as well as the corporate office. Implats intends to cut 30% of head office costs.

It said in a statement it had initiated talks with the unions in terms of Section 189 of the Labour Relations Act “which may lead to staff reductions”. Spokesperson Johan Theron said in the negotiations, all alternatives to retrenchment would be considered, which could reduce the number of jobs lost.

News of Implats’ retrenchment plans follows an announcement by Sibanye Stillwater two weeks ago that it could cut about 4,022 jobs at its gold operations in South Africa. In February, Anglo Platinum said it could cut about 3,700 jobs, about one-fifth of the workforce, at its South African operations after profits in the year to December plunged by 71% compared with a year previously.

Implats’ headline earnings in the six months to December fell 77% to R3.3 billion compared with the same period last year, as weaker PGM prices offset gains in production, sales volumes and from cost control.

Discussing the results, CEO Nico Muller said although several operations remained profitable at depressed prices, “several further actions may be necessary to ensure business sustainability in the medium term”.

Some of the actions already taken were to defer certain capital projects, postpone annual management salary increases, freeze recruitment for non-essential positions and voluntary retrenchments for non-unionised employees.

When Implats sealed the deal to acquire Royal Bafokeng Platinum (RBPlat) last year, it agreed with the unions and the department of trade and industry that it would not restructure those shafts, which are now known as Impala Bafokeng.

Theron said the agreement was that there would be no job losses as a result of the takeover, but it was not an agreement that precluded restructuring for operational reasons, in order for the business to remain viable.

Over the past year, the price of platinum has dropped from about $1,075/oz to $900/oz while palladium has slumped from $1,450/oz to just under $1,000/oz.