Northam swings to loss 11-week strike

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LonminMine Independent Newspapers. Picture: Boxer Ngwenya.

Johannesburg - Northam Platinum, the South African miner that endured an 11-week strike at the turn of the year, expects to post a loss when it reports results this month.

Northam is likely to post a loss per share excluding one-time items of 15 cents o 25 cents for the six months through December, the Johannesburg-based company said today in a statement.

That compares with a profit of 36.3 cents a share a year earlier.

The industrial action at Northam’s Zondereinde mine, its biggest operating asset, cost the company 750 million rand in lost revenue.

The National Union of Mineworkers signed a two-year deal January 21 to end the walkout that included pay increases of as much as 9.5 percent. Other platinum producers in South Africa remain on strike after talks stalled with another union.

Northam Platinum traded at 40.78 rand, up 0.6 percent, as of 12:34 p.m. in Johannesburg after earlier falling 3.7 percent.

The company raised 600 million rand during the strike by selling shares as it sought to weather the stoppage and bolster finances for capital expenses at its new Booysendal mine.

The Booysendal site, which started production in July, is still ramping up and “not yet in a position to contribute positively to the group’s earnings,” Northam Platinum said in today’s statement.

The company plans to publish financial results on or around February 21. - Bloomberg News


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