Johannesburg - Northam Platinum fell the most in four months in Johannesburg trading after saying higher borrowing costs and a tax charge will erode first-half profit.
Northam declined as much as 9.8 percent, the biggest intraday drop since September 21, before recovering to trade 0.9 percent lower at 35.5 rand by 9:59 a.m.
Earnings will probably be 30 percent to 45 percent lower in the six months ended December 31 compared with a year earlier, it said in a statement.
“The anticipated decline in earnings reflects the finance costs incurred on borrowings and a higher effective tax charge during the period under review,” Northam said.
The company sold 1.25 billion rand ($140 million) of bonds due 2015 in September to expand its operations.
The platinum industry is in crisis after falling demand and rising costs reduced profit margins, Anglo American Plc Chief Executive Officer Cynthia Carroll said in Cape Town, South Africa today.
Her company controls Anglo American Platinum, the world’s largest miner of the metal, which said January 15 it plans to shut four shafts and cut 400,000 ounces of production to return to profitability. - Bloomberg