Kumba Iron Ore has reported a slight decrease in first-half production, but sales rose as logistics improved.
Total production for the six months ended June decreased by 1% to 18.2-million tonnes, reflecting a flexible approach to production as Sishen and Kolomela were managed as an integrated complex, the group said on Thursday.
Sishen’s production decreased by 6% due to a planned drawdown of high levels of finished stock in the first quarter and maintenance activities in the second quarter. This was offset by Kolomela’s production, which increased by 12%.
Sishen and Kolomela’s unit costs, along with Kumba’s C1 unit costs, are expected to end the year within the full-year 2025 guidance, Kumba said.
Sales increased by 3% to 18.7-million tonnes, due to improved logistics performance compared with the prior period.
Ore-railed to Saldanha Bay Port increased by 4% to 18.9-million tonnes,, despite two derailments in the second quarter. Transnet’s performance at Saldanha Bay Port reflects better equipment availability, which resulted in sales increasing by 8% in the second quarter.
“Overall, this demonstrates the progress made through the Ore Corridor Restoration programme and the benefit of the ore users’ forum working more closely with the Transnet operational teams to address the maintenance requirements identified in the independent technical assessment,” Kumba said.
“Our operational performance continues to improve and we have made further progress on our ultra-high-dense-media separation (UHDMS) project to increase the premium proportion of our production and enhance margins,” said CEO Mpumi Zikalala.
“Continued focus on cost optimisation is helping to offset inflation-related costs. We are on track to achieve our C1 unit cost guidance of $39/tonne and our capital expenditure guidance of R9.5bn-R10.5bn is unchanged for the full-year 2025,” she said.
Zikalala added that iron ore markets were characterised by weak global steel demand, due to trade tariff-related uncertainty, while lower iron ore supply from Australia and other non-traditional producers was partly offset by an increase in supply from Brazil.
Kumba achieved an average realised free-on-board (FOB) export price of $91/wet metric tonne, 8% above the average benchmark price of $84/wmt, reflecting the high quality of the group's iron ore products, she said.
Kumba has maintained its full-year 2025 guidance at 35-million tonnes to 37-million tonnes for both production and sales.
The group said for the six months ended June, it expects its
headline earnings to be between R6.84bn and R7.34bn compared with R7.15bn a year ago.
Headline earnings per share are likely to be between R21.33 and R22.89 from R22.27 a year ago.
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