Rand takes shine off Sibanye
Operating profit at gold unit falls after SA currency firms against dollar
The strengthening of the rand against the dollar in the first quarter of 2017 wreaked havoc with the profit of Sibanye Gold’s gold division at a time when it was raising almost the equivalent of its market capitalisation to buy a US-based palladium miner. Sibanye, the largest producer of domestic gold and a rising force in the global platinum group metal (PGM) industry, posted production numbers for its March quarter, showing operating profit at its gold division falling to R967m from R2.5bn from a year earlier. The received gold price for the March quarter fell 14% to R515,998/kg for March compared with a year earlier. The all-in sustaining cost rose to R493,872/kg (R454,282/kg). The firming of the rand against the dollar by 16% during the quarter combined with a 9% decline in gold output to 330,100oz due to the closure of the Cooke 4 shaft, eroded profit for the company, which plans to issue shares to raise $1bn towards its $2.2bn purchase of Stillwater Mining in the US. It will i...
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