A REPLY from the world’s biggest platinum producer, Anglo American Platinum (Amplats), and the Rand Refinery yesterday could have helped explain how Amplats has benefited from introducing a new arrangement for its financial scheme to aid local jewellers.
Yesterday Johnson Matthey, world’s largest producer of automotive catalytic converters, posted an 11 percent drop in first-quarter operating profit to £103.6 million (R1.9 billion) compared with the same period last year.
As part of cost cutting, Amplats terminated its 21-year-long purchase agreement with Johnson Matthey last year. Johnson Matthey purchased platinum for catalytic converters at a discount in return for finding alternative uses for the precious metal.
Johnson Matthey also administered Amplats’s metal financing scheme, which offered financing to South African jewellers to assist them to compete internationally. Subsequently, Johnson Matthey gave Amplats notice that it would terminate its administration of the scheme as of the end of last month.
Amplats then appointed the Rand Refinery, which is owned by a group of gold producers, including AngloGold Ashanti, to take over the scheme from Johnson Matthey late in February. To date, neither the Rand Refinery nor Amplats have given an update on the new arrangement.
Yesterday, the UK-based company warned the market that it was likely to lose £30m in commission revenue this year after its contract with Amplats was terminated last year.
“We expect that the group’s performance in 2014/15 will be broadly in line with 2013/14, as continued growth across the group will be offset by the adverse impact of both the loss of commission revenue from Anglo Platinum… and by the effect of foreign currency translation,” Johnson Matthey said.
South Africans must surely be thankful that here on the southern tip we are well out of the way of the barbaric and self-destructive behaviour in the Middle East and eastern Europe.
The downing of a Malaysian airliner carrying 298 innocent civilians takes the biscuit for insane savagery, futility and scoring own goals.
Despite ritual handwringing over the poor victims, 80 of whom were children, the world led by a sickeningly triumphant US and Nato, turns the economic screws on Russia and drools over the further vilification of Russian President Vladimir Putin, whose pleas of innocence for the deed are meaningless.
Who would want anything to do with any of these self-serving hypocrites, unless of course you think you can make a few bucks out of setting up a development bank with them?
And then there’s everybody’s favourite never-ending conflict as Israel bullies its way into captive Gaza again, ostensibly to degrade the oppressed captive-population-terrorist government’s ability to rain down largely ineffective rockets on millions inside the Jewish state.
Here, at a blissfully far remove, no amount of handwringing or hate mongering will make a scrap of difference, until both sides talk their way out of this blood-soaked impasse. Even the predictable anti-Israel Muslims’ demonstration in Cape Town last week seemed a little confused with a commendable “Peace in the Middle East” placard drowned out by others screeching “Death to America” and “Death of Zionists”.
But there is some local upside. Emerging market currencies are benefiting from investors fleeing the growing Ukraine crisis. Deserters from the Russian rouble are piling into the rand, the lira and rupiah. Advancing the most over the past five days, the rand has strengthened 1.5 percent against the dollar. So it is not all bad news.
Edited by Peter DeIonno. With contributions from Dineo Faku and Peter DeIonno.