Chief executive Charles Walters said group headline earnings rose to a record R6.4 billion from R5.1bn a year earlier.
“It was particularly pleasing to achieve this, together with a good safety performance which aligns with our objective of sustainable safety across all our operations,” Walters said.
The group’s attributable earnings amounted to R6bn, 18 percent higher than a year earlier, representing a third consecutive annual record.
“Slower global growth is expected into next year. Continued growth in China, albeit slower than previously anticipated, should support prices for Assore’s products in the near term,” Walters said.
The group’s iron-ore division delivered a 106 percent hike in earnings to R6.8bn, compared with the corresponding period last year on robust iron-ore prices.
Seaborne iron-ore supply has been squeezed following the tragic tailings-dam failure in Brazil, coupled with weather disruptions in northern Brazil and Western Australia.
The supply squeeze has seen the average market price for iron ore (62 percent iron content delivered in China) increasing to $80 (R1192) a ton in 2019, from $69 a ton last year.
Assore said attributable earnings from Assmang, its iron-ore and manganese joint venture with African Rainbow Minerals, jumped 29 percent to R9.1bn in 2019, driven mostly by the 29 percent increase in sales revenue to R35.6bn.
Earnings from the manganese division fell by 39 percent from R3.8bn a year earlier, owing to R1bn in impairment charges relating to the investment in Sakura Ferroalloys.
Seleho Tsatsi, an investment analyst at Johannesburg-based Anchor Capital, said the manganese and chrome parts of the business had a challenging year, as oversupply put prices under pressure.
“There is uncertainty over where iron ore goes from here, given the expectation for Brazilian and Australian supply to eventually come back into the market. Given Assore’s balance sheet of R9bn net cash, it’s in a decent position to deal with future volatility,” Tsatsi said.
The group said lower chrome prices and increasing costs weighed heavily on the Dwarsrivier mine, leading attributable profit to 41 percent to R516 million from R875m in 2018.
“The reduced profit was compounded by a labour strike at the mine in March 2019, which accounted for the decrease of 4percent in production volumes,” Walters said.
“The cost-management performance was disappointing, with unit costs increasing by 14 percent over 2018,” he said.
The oversupply of ferrochrome in the group’s main market resulted in a decrease in demand for chrome ore, which saw the average index market price decreasing to $187per ton from $224 in 2018.
Assore shares declined 5.81percent on the JSE on Thursday to close at R300.