Patrice Motsepe. Picture :ARNOLD PRONTO
Patrice Motsepe. Picture :ARNOLD PRONTO

African Rainbow Minerals (ARM), a diversified mining company chaired by billionaire Patrice Motsepe, expects to report an interim profit, veering away from a loss at the same time in 2017.

ARM forecast it would post basic earnings per share for the six months to end-December of between 912c and 930c compared with a loss of 134c a year earlier, with stronger prices for the commodities the company produces.

The previous year’s interim results were skewed by impairments of more than R1.8bn against its Nkomati nickel mine and its Modikwa platinum mine, as well as a write-down within its Assmang joint venture with Assore related to the sale of the Dwarsrivier chrome mine.

Its headline earnings, which strip out one-off items to give a like-for-like comparison number, were forecast at between 986c and 1,037c per share from headline earnings of 893c the year before.

Giving good guidance on what to expect from ARM’s performance, Assore has already reported results showing a 17% increase in revenue to R3.8bn from the chrome, iron ore and manganese interests that it shares with ARM, while headline earnings climbed 12% to R23.55 a share.

ARM, which releases its results on March 16, is a shareholder in Harmony Gold, with Motsepe also chairing that company. ARM was linked last year to a possible deal with Harmony to become involved in the Wafi-Golpu copper and gold deposit in Papua New Guinea.

Harmony’s management is talking openly of looking for options around its 50% stake in the project, exploring bringing in a partner, selling the stake or keeping it and funding the billions of rand needed to build a mine there.

ARM has recently sold a capital-intensive copper mine in Zambia, and Motsepe has said the company regards copper as a commodity in which it would like to invest.

seccombea@bdfm.co.za