Kumba Iron Ore shares soared 9% on Wednesday after it said improved iron ore prices in 2016 boosted annual profit by more than 20% after the company aggressively cut costs to cope with a lower price environment, which a range of forecasters predict will happen this year and next. Kumba, an Anglo American subsidiary, said its headline earnings for the year to end-December would be between R8.45bn and R8.89bn compared with R3.79bn a year earlier. Headline earnings would rise by up to 135% to the top end of the forecast of R27.72 per share. Basic earnings were forecast to be between R8.4bn and R8.78bn from R469m a year ago. "The increase in earnings is largely attributable to the increase in export iron ore prices, as well as the impairment charge of R5.978m that was included in basic earnings, but excluded from headline earnings in the comparative period," Kumba said. Kumba produces its iron ore at less than $40 a tonne. Iron ore with a 62% iron content was selling for $82.69 a tonne ...
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