Anglo American Platinum (Amplats) declared a record interim dividend as higher platinum group metal (PGM) prices combined with strong operational performances on mining and refining.
Amplats, which is an Anglo American subsidiary and one of the world’s leading PGM producers, declared a number of financial records for the six months to end-June, with a R46.4bn payment to shareholders in the form of a base and special dividend.
This equated to R175 per share compared with R10.23 a year earlier.
Amplats, which had a fatality-free six months, posted record earnings before interest, tax, depreciation and amortisation (ebitda) of R63bn from R13bn the year before.
PGM output was 28% higher compared with the previous year when the Covid-19 pandemic disrupted production and shut down the SA economy and its mines in March, with a slow ramp up to steady state production in July and August.
More importantly, refined metal production staged a strong recovery after a difficult 2020 when converter plants between the smelters and refineries were shut for emergency repairs.
Refined metal output increased by 128%, coinciding with a one-third increase in the rand price for the metals the company produces.
The three main PGM metals that Amplats produces include platinum, palladium and rhodium, which are primarily used in anti-pollution devices for petrol and diesel engines.
In dollar terms, the average price for PGMs was 47% higher, with rhodium and palladium hitting record highs during the interim period while platinum reached six-year peaks.
“Our operations had a strong recovery in performance, despite managing through the ongoing impacts of Covid-19,” said Amplats CEO Natascha Viljoen.
“Our four own-managed mining assets are competitively positioned on the primary cost curve, and have delivered record financial returns in the first half of 2021,” she said.
“We have considerable diversity in the metal ratios of our ore bodies, creating resilience through price cycles,” she said.
Amplats has a powerful balance sheet, with net cash of nearly R57bn, setting it up for two large projects at its Mogalakwena and Mototolo/Der Brochen mines as well as building a 100MW solar array at the former mine as part of its move into generating hydrogen for its fleet of mining vehicles.
A decision on the Mogalakwena project will be made in 2022 after a study at the opencast and profitable mine is completed at the end of this year, Viljoen said.
Amplats had net cash of R19bn at the end of December 2020.
Forecast refined output for the full year was 4.8-million and 5-million ounces of PGMs.
“However, refined production is subject to rising infection rates from Covid-19, as well as potential Eskom power disruptions in the second half of the year,” Viljoen said.
Refined platinum output was pegged at 2.2-million to 2.3-million ounces and refined palladium at 1.55-million to 1.60-million ounces.
Correction: July 26 2021
An earlier version of this article said Anglo's dividend payout amounted to R46.4m, when this figure should have been in billions.
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