Northam lifts operating profit after year of record spending
Northam Platinum reported increased annual operating profit as a result of a sound production performance at its mines as it continued to pour cash into growth projects during the year.
Northam, one of the most aggressively growing platinum companies in SA, reported that operating profit increased by 34% to R823m for the year to end-June compared with the previous year.
In its preferred metric, Northam said its normalised earnings were up by nearly 6% to R422m.
The profit line is skewed by a R1.1bn dividend payment to holders of a preference share put in place for an empowerment transaction to lift black ownership of the company to just above 30%. Northam recorded a post-tax loss of R705m from a R636m loss the previous year.
Northam spent a record R3.8bn during its 2018 financial year on various growth projects, including the R1bn purchase of resources from Anglo American Platinum to add to its Zondereinde mine, a new 20MW furnace, the purchase of Eland Platinum from Glencore, an American recycling business and investment in its new Booysendal mining complex.
Production of six metals comprising the basket of platinum group metals (PGMs) Northam generates increased by 4.5% to 571,843oz for the year, with Zondereinde, the deepest of SA’s platinum mines, boosting output by 7%.
Northam has said it has unprocessed metal worth upwards of R2bn that it will process during the 2019 financial year.