RBPlat said the platinum group metal basket price trended lower during the first six months of the year. Photo: Supplied
The swansong of Royal Bafokeng Platinum (RBPlat) yesterday saw the platinum producer post a drop by 115% in interim earnings on the back of a decline in metal prices, low production volumes and higher cost of sales.
This is the group’s last earnings report to the JSE as it prepares to delist next month, and cease trading on the JSE on Wednesday following Impala Platinum acquiring 98.73% of RBPlat’s issued ordinary share capital.
This will result in RBPlat becoming a wholly-owned subsidiary of Implat.
In its interim results for the six months ended June 30, 2023, the mining producer said headline earnings dropped by almost 115% to a headline loss of about R330 million.
Revenue decreased by 29% to R5.8 billion. The cost of sales increased by 15.1% to R6.2bn, in part due to on-mine inflation being higher than consumer inflation.
The unit cost per tonne milled and per 4E ounce went up by 13.7% and 19.5% to R2135/tonne and R22,930/4E ounces, respectively.
RBPlat said the platinum group metal basket price trended lower during the first six months of the year.
Rhodium, which has been the largest driver of the basket price in the recent past is now below $5 000 (R89366) an ounce, down more than 80% from its high of $29 800 an ounce in March 2021.
RBPlat CEO Steve Phiri said: "The operating environment for the first half of 2023 was characterised by a decline in the basket price combined with ongoing inflationary pressure on the operating costs of the business".
In production, total tons hoisted decreased by 1.5% to 2 299 kilo tonnes (kt), with Bafokeng Rasimone Platinum Mine tons hoisted marginally reduced by 0.1% to 1 275kt.
RBPlat said Styldrift tons hoisted declined by 3.1% to 1 024kt due to ongoing operational challenges in addressing resource inefficiencies and ore generation constraints.
"Bafokeng Rasimone Platinum Mine’s steady operational performance was offset by a weaker operational performance from Styldrift, which was caused by a slower recovery from the operational challenges experienced in 2022. We also recorded a disappointing performance in our safety metrics, having sadly lost one of our employees, and a deterioration in our serious injury frequency rate," Phiri said.
RBPlat said its full-year production forecast remained unchanged at 4.65-4.90 million tonnes at a grade of 3.78-3.80g/t, which would yield 470-490koz 4E metals in concentrate. Costs were expected to come in between R19 750 and R20500 per 4E ounce.
Looking ahead, RBPlat said the availability of electricity was a major threat to South Africa’s PGM production.
"At the beginning of the year, mining companies stated that up to 15% of their production could be lost due to the higher stages of load shedding. In the first half of the year, load curtailment impacted concentrating and smelting activities leading to an increase in inventory.
"Mine supply is still forecast to grow in 2023, however, Eskom load curtailments remain a downside risk. Russian PGM production for 2023 has been guided lower with supply chain constraints remaining a threat to supply. Secondary supply is forecast to increase marginally, however, lower PGM prices are a downside risk as they may lead to hoarding," the group said.
By 4pm RBPlat’s share price was 0.63% lower at R127.18 on the JSE.
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