Building materials and industrial minerals group Afrimat says it is ramping up production at its mines according to market demand, even though a change in government lockdown regulations allow opencast mines to scale up to full employment.
In terms of level 4 restrictions certain mines may restart operations, of which opencast mining may scale up from a baseline of 50% to full employment, the group said.
“All Afrimat mines are opencast mines and therefore may operate at full capacity. However, due to the restrictions on certain markets, Afrimat is ramping up operations according to market demand and in line with regulations from government and therefore certain Afrimat mines are not operating at full capacity,” the statement read.
The group said in a trading update it expects headline earnings per share (heps) in its year to end-February to rise by 44%-54% from the prior period’s 234.1c, having given guidance of an increase of 38%-58% in April.
The group then reported strong growth in its industrial minerals business, which includes the production of agricultural lime, which is used to reduce soil acidity.
Heps is a widely used profit measure in SA which strips out exceptional items to give a better indication of the underlying performance of a business.
The group also reported a “healthy contribution” from its Demaneng iron ore mine.
Afrimat benefited from rising iron ore prices in 2019, and Demaneng produces high-grade ore. Afrimat acquired the mine, then known as Diro Iron Ore, in 2016 for R400m.
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