Fin24

Lonmin punished after mine crackdown

2012-08-17 09:53

Johannesburg - Shares in Lonmin [JSE:LON], the world’s No.3 platinum producer, fell more than 5% in early trade on Friday after more than 30 miners were killed the previous day in a police crackdown to end an illegal strike.

Lonmin said on Thursday it had lost 15 000 ounces of platinum production due to the one-week long strike at its South African operations and that it was unlikely to meet its full-year production target of 750 000 ounces.

The shares, which fell more 7% on Thursday, opened 5.6% lower and were trading 4.7% down at R79.75 as of 09:06.

Despite Lonmin's woes, the JSE hit record highs, edging higher on hopes that Europe will be able to contain its debt crisis.

The benchmark Top 40 - (Tradeable) [JSE:J200] index briefly touched a record high of 31 676.46 before giving up some gains. The broader All Share [JSE:J203] index hit 35 865.11.

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Comments
  • djmain1 - 2012-08-17 10:52

    I think Lonmin needs to take some responsibility for this tragedy. They squeezed their workers until they were desperate. It's also very likely that they stoked the fire between the two unions as it would be in their interests to do so. Just as a matter of interest, what is Ian Farmer's salary? How many thousand percent more does he earn than the RDO's?

      chaapo.sithole - 2012-08-17 11:18

      Workers stoked the fires themselves - gangaster turf wars and making ridiculous demands. Doesn't matter what the guy earns- he made the investment with hard earned money and took all the risks. Do the same and maybe you will benefit too. As it is, now the company is on a slide, the consequence being they might just be forced to trim labour and then that adds to the unemployment. Then who will the workers and supporters blame next- the government for not forcing business to stay in a loss-making venture? Simple to work out if basic education would teach people cause and effect.

      djmain1 - 2012-08-17 11:31

      RE cause and effect - that's exactly what I said - Lonimn were part of the cause and the effect was a violent protest. I doubt whether Ian Farmer had to put up any of his own money - he is the CEO not some investor. All he does is draw a salary (+ bonuses + share options etc) - and a BIG one at that. And seriously what risks did he take? Pure greed and callousness.

  • winifred.watson.9 - 2012-08-17 14:40

    Well this is not good news and will deter investors. Its been a long time coming. The Unions are ultimately to blame, they are the ones that fuelled the fire. I hope that this will be a lesson and especially to numsa. numsa believe that since government jump to attention when they cry, other people must do the same. Although I agree wages are the root of this, but everybody is feeling the pinch at this point in time. At least we have a job, a lot of other people are not so fortunate. Unions believe they are gods and when the speak everybody must jump or the call for strikes and protests and they get to shout and dance and get the lime light when infact in the end of really wins, the workers might be a few rand more but stand a chance of losing wages because of the strike so I would say its a no win situation.

  • mike.stowell.526 - 2012-08-17 19:10

    Nationalisation comrades ahoy ahoy

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