Jaco Visser

ANGLO American Platinum (Amplats) reported a loss for 2012 and continues to suspend its dividend as sales of refined platinum fell and cash operating costs increased.

Amplats had a headline loss, which excludes one-time items, of R1.47 billion, or R5.62 a share, from headline earnings of R3.57bn, or R13.65 a share, in 2011, the firm said yesterday. The average estimate of seven analysts surveyed by Bloomberg was for a loss of R5.59 a share.

The company skipped its interim dividend last year.

Amplats, controlled by Anglo American, proposed last month to shut four mine shafts to curb costs and stem losses spurred by a two-month strike last year.

The plan, which would cut about 7 percent of global output, was put on hold following criticism from the government. The postponement allows for talks with the Department of Mineral Resources and unions.

“We need to take action to turn this business around,” chief executive Chris Griffith said yesterday.

“Primary supply challenges will continue in 2013.”

Local analysts use headline earnings as the benchmark measure of company performance. Amplats reported an attributable loss of R6.68bn compared with a profit of R3.59bn in 2011. Cash operating costs increased 21 percent to R16 364 a refined ounce, the firm said.

Refined platinum production at its operations declined 8.8 percent to 1.77 million ounces, while total platinum group metals output fell 6.7 percent to 3.5 million ounces.

“It is a very difficult time for the company,” Investec Asset Management trader Ryan Wibberley said.

“It is disappointing not to see a dividend, although it is not a surprise.”

The shares rose as much as 1.5 percent to R455 yesterday, the highest intraday level since January 18, but closed 0.12 percent lower at R447.55.

Part of its restructuring proposal included the sale of the Union operation.

The company had received expressions of interest for the mine as well as for Pandora, Griffith said.

Debt at Amplats, which had R12bn in undrawn committed credit facilities, rose by R7bn last year and should start to decline from 2014, finance director Bongani Nqwababa said.

“We get preferential rates on our credit lines of around 6 percent,” Nqwababa said. “It’s unlikely we will go to the debt capital market.”

Anglo American would report an underlying loss in respect of Amplats of $225 million (R2bn) for the year to December, it said yesterday. – Bloomberg