Assore's profits more than double on higher pricesComment on this story
Johannesburg - South African iron ore producer Assore said on Wednesday its first-half earnings more than doubled to record levels, boosted by higher prices and a weak rand.
Its share price rose 4.5 percent on the news, a day after Anglo American unit Kumba Iron Ore reported solid growth in its full-year earnings.
Assore's diluted headline earnings for the six months to end-December rose nearly 120 percent to 23.52 rand a share compared to 10.72 rand in the same period in 2012.
It also increased its interim dividend to 450 cents from 250 cents the year before.
The company's Assmang unit, an iron ore and manganese producer in which it has a 50 percent stake, added significantly to Assore's bottom line as its headline earnings also more than doubled.
“Selling prices in US dollars for iron ore exports were on average 13 percent higher compared to the previous period,” Assore, noting that revenues were also boosted by the weaker rand, which adds to the margins of local mining companies whose commodities are dollar priced.
The rand has since lost more ground and has recently hit five-year lows, bringing some relief to South Africa's wider mining sector which has struggled with labour unrest and depressed global prices.
Assore said its results “remain exposed to fluctuations in the rand/US dollar exchange rate, which has already weakened significantly since the start of the new calendar year.” - Reuters