Fin24

ARM earnings lifted by sales

2012-02-27 08:34

Johannesburg - Diversified mining group African Rainbow Minerals [JSE:ARM] said on Monday its earnings increased by 24% as sales volumes for all of its key commodities rose.

Sales were 30% higher at R8.72bn with volume increases in iron ore, manganese ore, manganese alloys, platinum group metals, nickel, chrome concentrate and thermal coal, which is sold to power utility Eskom.

The company is targeting growth through the development of its four major projects in iron ore, nickel, coal and copper. Key among these is the ramp-up of iron ore production to 16 million tonnes per annum at the Khumani Mine in South Africa.

Nickel production at Nkomati is being increased to 20 500 tonnes per annum and the Goedgevonden Mine is moving towards 7.0 million tonnes per annum.

Copper output at the Konkola North Copper project in Democratic Republic of Congo is forecast to be 45 000 tonnes per annum at full production.

“We are making substantial progress with our growth projects and are excited about government’s stated commitment to allocate huge resources to upgrade rail, port and electricity infrastructure,” said ARM executive chairperson Patrice Motsepe.

ARM warned of above-inflation increases particularly in labour, electricity and diesel but believes commodity prices will remain robust over the medium to long term.

Headline earnings per share were 912 cents for the six months to end-December from 734c a year ago.

ARM’s share price is up around 11% in the year to date, outpassing a 7.3% rise in the Johannesburg bourse’s benchmark Top 40 - (Tradeable) [JSE:J200] index.