Impala Platinum shares fall 5% after profit decline

Published: 2023-03-02 tag: commodities

JSE:AGL JSE:AMS JSE:IMP JSE:SSW JSE:NPH JSE:RBP

March 2 (Reuters) - Impala Platinum's (IMPJ.J) shares fell more than 5% on Thursday after the South African miner reported a 2.1% drop in half-year profit, saying power cuts and a furnace rebuild had hit platinum group metal (PGM) production.

The company's shares were down 5.06% at 0839 GMT at their lowest since late September 2022.

South Africa, the world's top PGM producer, is facing extended electricity cuts due to the frequent breakdown of its coal-fired power generation plants, dimming the global supply outlook for the metals mostly used in the automotive industry.

Anglo American Platinum (AMSJ.J) and Sibanye Stillwater (SSWJ.J) have recently warned that South Africa's 2023 PGM output could be significantly affected if the power cuts persist.

Impala's headline earnings per share (HEPS) - the main profit measure in South Africa - fell to 16.54 rand ($0.9089) in the six months to Dec. 31 from 16.90 rand the previous year.

Its refined output declined 9% to 1.476 million ounces from 1.617 million ounces in the same period last year.

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"Smelting capacity was constrained by increased (electricity) load curtailment and the scheduled rebuild of the Number 4 Furnace in Rustenburg, which started in late November 2022," Impala said in a statement.

Impala, which has operations in South Africa, Zimbabwe and Canada, declared an interim dividend of 4.20 rand per share.

The company is still pursuing its bid to acquire mid-tier Royal Bafokeng Platinum (RBPlat) (RBPJ.J), despite a competing offer by smaller rival Northam Platinum (NPHJ.J).

Impala, which already owns 40.71% of RBPlat, recently extended the closing date of its offer to RBPlat shareholders to March 31, due to delayed regulatory approvals.

($1 = 18.1979 rand)

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