Impala Platinum (Implats) expects its annual earnings to drop by up to 44% due to lower metal prices.
In its trading statement for the year ended June 30, 2023, the group said headline earnings for the period were expected to decrease by between 38% and 44% to between R18 billion and R20bn, while headline earnings per share (heps) were forecast to decrease by between 39% and 45% to between 2 117 cents and 2 352c per share.
“Headline earnings and Heps for the comparative period were R32 billion and 3 853 cents, respectively,” it said.
Earnings for the period decreased primarily due to lower revenue, arising from an 18% lower achieved dollar metal price, partially offset by a 16% weaker rand.
“The impact of the increased frequency and severity of load curtailment and cable theft resulted in a cumulative loss of 147 000 6E ounces of refined production for the period, which negatively impacted sales volumes.
“Cash costs continued to be negatively impacted by higher inflation and the impact of the weaker rand on the translated costs of Zimplats and Impala Canada. In addition, the lower US dollar rhodium price at the end of the period resulted in a R2.1 billion (post-tax) write-down of closing inventory, which negatively impacted earnings,” the group said.
Implats also reported that its basic earnings for the period were likely to decrease by between 81% and 88% to between R4bn and R6bn, while earnings per share (EPS) were expected to decrease by between 82% and 88% to between 470c and 706c per share.
“Basic earnings and EPS in the comparative period were R32bn and 3 856 cents, respectively,” it said.
Basic earnings were further impacted by the impairment of property, plant and equipment at Impala Canada of R7.8bn, or 919 cents per share (post-tax), due to the combined impact of a material decrease in the US dollar palladium price profile and higher prevailing inflation.
Implats said its basic earnings were also impacted by the loss on the remeasurement of the previously held equity investment in Royal Bafokeng Platinum (RBPlat) of R1.8bn, or 208 cents per share (no tax), at the date that RBPlat became a subsidiary of the group.
Implats said the impairment of goodwill of R4.2bn, or 499 cents per share (no tax) arising on the acquisition of RBPlat, also affected its basic earnings.
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