Implats earnings leap 41%

Johannesburg - Impala Platinum Holdings [JSE:IMP], the world's second largest platinum producer, said on Thursday that its headline earnings for the 2011 financial year rose 41% on higher prices and said it was on course to reach annual production of 2 million ounces.

Implats' headline earnings per share for the financial year that ended June 30 soared from 786 cents to 1 105c near the top end of the 1 075 to 1 115c range the group had flagged in advance to the market. Its dividend was raised 46% to 570c per share.

Headline EPS is the main profit gauge in South Africa and excludes certain one-time items.

The group said its platinum production rose 5.5% to 1.836 million ounces, also in line with its own forecasts. It did not give a specific output forecast for the next financial year but said expansion at its Zimbabwean unit Zimplats "will support our growth aspirations to over 2 million ounces of platinum per annum by 2014."

But its Zimbabwe operations are clouded in uncertainty as the government there is forcing foreign mining houses to surrender 51% of their local equity stakes to black investors. This could have an impact on production there.

"The group is engaged in ongoing discussions with the government of Zimbabwe in this regard and we believe this will achieve an acceptable outcome," Implats said.

Implats also said it saw strong fundamental demand for platinum group metals over the medium term driven by rising car sales in emerging economies.