Pan African Resources share prices surges as earnings double on strong South African rand

 
Jessica Morris
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The rand plummeted when President Jacob Zuma fired South Africa's finance minister (Source: Getty)

AIM-listed Pan African Resources shrugged off the gloomy sentiment that's hanging over equity markets today, with the strong South African rand helping it to double earnings during the last half of 2015.

Shares in the South African miner jumped as much as 16 per cent to 13.05p in mid-afternoon trading.

The company, which operates gold mines in the towns of Evander and Barberton, expects headline earnings per share to rise at least 119 per cent in the six months ending December 31 to between 11.87 cents and 12.95 cents.

And in sterling terms, the miner predicts headline earnings per share will increase at least 90 per cent to between 0.57p and 0.63p.

"The period-on-period change in the average exchange rate of 16.6 per cent must be taken into account for the purposes of translating and comparing period-on-period result," it said in a trading update today.

The South African rand has tumbled due to growing political and economic uncertainty ahead of the country's municipal elections later this year. This was compounded when President Jacob Zuma fired finance minister Nhlanhla Nene in December, and removed his replacement a week later.

Pan African Resources also reported production rose by 16.3 per cent to 106,290 ounces during the six-month period, up from 91,386 ounces last year.

This was driven by a 34.4 per cent rise in production at the Evander mines to 45,350 ounces of gold, while production at its Barberton mines ticked up 6.6 per cent to 56,447 ounces.

The company is expected to release its interim results later this month.

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