Johannesburg - Northam Platinum [JSE:NHM], one of South
Africa's smaller platinum producers, reported a 30.1% fall in first-half
headline earnings as finance and tax charges swelled.
Headline earnings per share for the six months to end
December were almost a third lower at 36.3 cents from 51.9 cents in the first
half of its previous year.
Production of precious metals in concentrates climbed 6.5%
to 157,183 ounces and precious metals sales grew 4.4% to 177,655 ounces.
Northam managed to escape last year's violent labour unrest
unscathed but its future will be impacted by the crisis in the South African
"Against the background of a volatile labour relations
climate in the South African mining sector, Northam's results reflect a
sustained operational recovery at the company's Zondereinde mine," Northam
Threats of a worldwide shortage of platinum group metal
(PGM) supplies from South Africa helped to stem the decline in the dollar
prices of PGMs.
The weakening of the South African rand against the US
dollar also played a hand in improving the rand basket price, which helped push
While social and economic uncertainty is expected to
dominate the platinum industry's agenda this year the company said it would
deliver an improved operational performance compared to the previous year.
Northam did not declare an interim dividend, choosing
instead to ensure it has enough cash for the R4bn development of its flagship
It also wants to cushion itself against the uncertainty in
the South African mining industry.
The company's shares have gained 20.86% in the past 12
months, while the JSE's Platinum Index has fallen 13.10%.
A massive decline in earnings have been reported across the
platinum sector as the larger producers struggle to regain their footing after
their operations were brought to their knees by extended illegal strikes late
More than 50 people were killed in labour unrest last year.