Anglo American Platinum (Amplats)'s shares fell by almost 7% following it saying it expects its half-year profits to decrease by almost 75% due to Eskom's load curtailment and smelter rebuild costs.
The shares fell to an intraday low of R858.28 on the JSE, having decreased by 33.5% in the past six months.
In its trading statement for the six months that ended June 30, the world’s biggest platinum producer said headline earnings and headline earnings per share (Heps) were likely to decrease by between 65% and 75% compared to the six months ended June 30, 2022.
"Headline earnings are likely to be between R6.7 billion and R9.4 billion, R26.7bn in 2022 first half, and Heps will decrease to between 2544 cents and 3569 cents per share, 10 140 cents in the first half of 2022.
Earnings per share (Eps) for the period were likely to decrease by between 65% and 75% compared to the 2022 first half. Basic earnings are likely to be between R6.6bn and R9.3bn, R26.7bn in 2022 first half, and Eps are expected to be between 2506 cents and 3 531cents per share, compared to 10125 cents in the 2022 first half.
The group flagged that earnings had decreased for the period largely due to a decline in revenue as a result of the lower average platinum group metals (PGM) basket price relative to the corresponding six months in 2022.
"The main contributors to this were declines in rhodium and palladium US$ prices, which were 47% and 29% lower, respectively," it said.
Amplats said the weakening rand/ dollar exchange rate partially mitigated the dollar price impact on the overall rand basket price, which decreased by 15% against the reported period.
Amplats flagged that sales volumes from its own production, excluding trading, were 12% lower compared to the first half of 2022.
"This reflected lower refined production as a result of the Polokwane smelter needing to ramp up in January following its rebuild; scheduled annual maintenance and asset integrity work at the processing operations; and the impact of Eskom load-curtailment, which resulted in deferred production of 66400 PGM ounces," it said.
The group said continued inflationary pressure and exchange rate volatility had also led to higher mining and processing costs.
"Costs incurred in purchasing of concentrate decreased compared to the 2022 first half due to lower prices and volumes," the group said.
Amplats will release results for the six months ended June 30, 2023, on July 24.
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