Implats on Thursday committed to returning cash to shareholders in the next two years as higher sales volumes and stronger metal prices saw the group raking in a R1.17 billion profit in the year to end June. Photo: Supplied
JOHANNESBURG – Impala Platinum (Implats) on Thursday committed to returning cash to shareholders in the next two years as higher sales volumes and stronger metal prices saw the group raking in a R1.17 billion profit in the year to end June from a R10.7 billion loss in 2018.

Chief executive Nico Muller told journalists that the group would be in a position to return to a sustained dividend.

The group has not declared a dividend since 2015.

“We believe that we need to get through the risk period of restructuring, and the wage talks. We see the bulk of the risk playing itself out in the next 12 months," Muller said.

A robust rand Platinum Group Metals (PGM) price environment and significant operational improvements have seen the group’s net cash position hitting R1.1bn and liquidity headroom improving to R12.2bn.

Revenue improved 36 percent to R48.6bn while headline earnings rose to R3bn or 423 cents a share from a R1.2bn loss a year earlier.

Muller said there had been a marked improvement in some key shafts that were earmarked for closure last year.

“They have improved significantly over the past year to the extent that 12 Shaft has contributed to our cash flow,” Muller said.

Headcount at the Rustenburg operations was reduced by 1 300 with only 117 forced retrenchments, the company said.

It said it aimed to reduce the numbers further through outsource mining operations in 1 Shaft and the complete closure of Shaft 9. It expects to pay R1.6bn in restructuring costs for the 2020 financial year.

Amplats is currently involved in wage talks with organised labour.

Lee-Ann Samuel, Implats group executive for people, said relations with the majority union in the sector, the Association of Mineworkers and Construction Union (Amcu), were cordial.

“We have not had sticking points,” Samuels. “Amcu has also taken a lot of demands off the table. I am cautiously optimistic to see a conclusion very soon, hopefully before their conference in September.”

The company said it had weathered the economic uncertainty and electricity crisis in Zimbabwe, which has endured 18-hour daily power cuts.

Stanley Segula, the managing director at Zimplats, said there had been no power disruption at the company.

Seleho Tsatsi, an investment analyst at Anchor Capital, said Implats reported a strong recovery in earnings and cash flows, as the rand PGM basket rallied 22 percent.

BUSINESS REPORT