the g spot
Sibanye’s big cost squeeze
The PGM producer has warned investors to brace for a 47%-52% slump in first-half headline earnings, thanks to a prolonged gold strike in SA, a severe flood at its US operations, and a 19% slide in rand PGM prices over the six months to end-June
Platinum group metal (PGM) producers such as Sibanye-Stillwater have suffered a stunning reversal of fortune in the past four months, with palladium prices sharply lower from their March peaks of more than $3,000 an ounce, not to mention platinum, which has steadily dribbled back below $1,000. Wednesday’s profit warning wiped more than 5% off Sibanye Stillwater’s share price, driving it back below R40, and taking losses since its March peak of R78 to 49%. Last week, the company announced it would be reorganising its US palladium operations to square up for a grimmer time. The FM spoke to CEO Neal Froneman.
The deterioration of fortune seems swift and quite vicious. Is it that bad?..
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