Implats revenue rises by R1.4bn

Johannesburg - Impala Platinum (Implats) [JSE:IMP] revenue of R16.5Bn was 9.5% higher (R1.4bn) in the second half of last year compared to the same period in 2012, CEO Terence Goodlace said on Thursday.

This was due to lower platinum dollar prices being offset by a weaker exchange rate, he said in a statement. The company was releasing results for the six months ended December 31, 2013.

Gross profit declined by R0.7bn compared to the previous year as the cost of sales increased by nearly 17% due to inflationary increases in direct operating expenses.

The company's headline earnings increased by 10.8% to R860m.

Mine-to-market output increased by 9.2% due to the build-up of metal in the second half of 2012 and the higher volumes at Zimplats.

Gross refined platinum production decreased by 9.1%.

Goodlace said the company decided not to declare an interim dividend due to the current industrial relations climate.

"Implats delivered a solid operational performance... at Impala Rustenburg as well as the Zimplats and Marula production build-ups," he said.

"While the underlying medium to long-term demand drivers for PGMs (platinum-group metals) remained robust, the relatively weak macro-economic environment, together with excess above-ground metal inventories, continued to constrain PGM prices."

This provided little respite for the industry and cash flows remained constrained.

World economies were showing some positive growth signs, but Implats continued to forecast deficit markets for the next year or two. This would slowly erode inventories and boost prices.

In its results, the company said the operating environment in South Africa remained challenging due to labour dynamics and increased stakeholder expectations.

Cost pressures remained high as a result of potential wage settlements and power increases.

The platinum sector has been severely battered since mineworkers affiliated to the Association of Mineworkers and Construction Union (Amcu) began striking in January.

The union's members at Lonmin [JSE:LON], Anglo Platinum (Amplats) [JSE:AMS], and Implats were demanding a R12 500 basic salary.

The Commission for Conciliation, Mediation, and Arbitration had been brokering talks between Amcu and the companies since January 24. These would continue on Friday.

Implats, the world's second biggest platinum producer, said its Rustenburg operation had been shut completely for the safety of non-striking workers.