Implats could cut 2 500 jobs to end losses at Rustenburg mine | Fin24

Implats could cut 2 500 jobs to end losses at Rustenburg mine

Sep 19 2017 10:03
Liezel Hill, Bloomberg News

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Last traded 102
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Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg - Impala Platinum [JSE:IMP] may cut at least 2 500 jobs at its Rustenburg mining complex to stem losses and adjust to lower prices.

Impala has notified unions and the government to begin a mandated consultation process ahead of proposed cuts and restructuring at its largest operation, the Johannesburg-based company said in a statement on Monday.

Additional action may be needed in the future, the miner said. 

The Rustenburg operations, which employ about 31 000 people, are experiencing “severe financial pressure” after costs rose and as rand-denominated platinum prices remain low, Impala said. Labour productivity and platinum output have also declined in the past few years, it said.

Spot platinum prices struggled to recover from a 26% drop in 2015 that capped three consecutive annual declines. South African producers are facing a stronger local currency, which has gained 10% this year against the dollar, pushing up costs. Impala has also been battling to fix inefficient working practices and absenteeism at Rustenburg.

“Unfortunately, we are now left with no further option in the prevailing operating environment but to consider further restructuring processes that may lead to a reduction in the number of employees,” CEO Nico Muller said in the statement.

Impala said last week it set a target to return Rustenburg to a cash neutral position by 2019 and may consider closing or selling parts of the “large and intricate” mining complex.

The company’s shares fell 3% on Monday, to R33.20 in Johannesburg, extending their decline this year to 22%.

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