JOHANNESBURG - Coal and heavy minerals mining company Exxaro said on Thursday its headline earnings per share were up 42 percent to R17.30 in the six months ended June 30.
Exxaro said revenue increased by two percent to R12 billion, but net operating profit was down 24 percent at R2.4 billion.
Exxaro, which has interests in the coal, TiO2, ferrous and energy sectors, declared an interim dividend of 864 cents per share.
It said increasing geopolitical risks and aggressive trade policies were anticipated to weigh on global economic activity during the second half of 2019.
"In terms of the global coal market, we do not see a recovery from the current pricing and demand balance," the company said.
"China will continue to influence the supply/demand balance in the Pacific with related price volatility. With the oversupply of coal in the Atlantic Basin, coupled with gas price forecasts remaining low, the market remains bearish for the remainder of the year.
The weak South African growth outcome had raised the risk of a sovereign rating downgrade towards the end of the year, while the rand/US dollar exchange rate was forecast to remain volatile.
"We expect domestic coal demand and pricing to remain stable for the remainder of the year," Exxaro said.
As it rolled out integrated operations centres at all the company's operations, in terms of a digitalisation plan, Exxaro said the increased visualisation of the mining value chain would highlight inefficiencies that would be addressed through improved decision-making relating to safety, productivity and cost performance.
During the second half, the performance of its Sishen Iron Ore Company investment would be well supported by the momentum from the first half of 2019, a tight iron ore market and continued stable demand for higher-grade products, the company said.
"However, an expected recovery in seaborne supply, with moderation of Chinese demand may dampen current market enthusiasm," it added.
- African News Agency (ANA)