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Johannesburg - Lonmin [JSE:LON] extended its decline this year after the world’s third-biggest platinum producer said it will write down the value of its net assets by as much as $2.05bn.
“The group’s net assets attributable to equity shareholders are expected to be valued between $1.6bn and $1.8bn following a significant impairment charge of $1.85bn to $2.05bn for the year ended September 30,” the Johannesburg-based company said in a statement on Monday.
The shares fell as much as 7.8% to 23.50 pence in London and traded 3.9% lower at 24.50 pence at 08:45, valuing the company at $221.8m. The stock has declined 86% this year.
The company is looking to raise $400m in a share sale, its second in three years, as it moves to stave off concern its debt is unmanageable amid a 19% slump in prices for the metal this year. The plan follows $817m of shares sold in 2012 after protests at Lonmin’s Marikana mine led to police killing workers.
Mineworkers held a five-month strike at its operations in 2014 before agreeing to above-inflation wage increases.
The company forecasts sales of about 700 000 platinum ounces for the year to September 2016 after it reported 751 560 oz for fiscal 2015, compared with a forecast of 730 000 oz, it said.
On the JSE Lonmin shares were trading at R5.36 at 11:25, down 0.56%.
