Amplats back in profit but fresh strikes loom

City A.M. Reporter
ANGLO American Platinum swung back into profit in 2013 as it rebounded from a wave of wildcat strikes but its recovery is threatened by looming strikes across South Africa’s platinum belt.

Maintaining profit margins will be tough if the hardline Association of Mineworkers and Construction Union (AMCU) goes ahead with its planned industrial action today at Amplats and rivals Impala Platinum and Lonmin.

Amplats, the world’s top producer, said yesterday its 2013 headline earnings per share were expected to be between 480 and 590 cents, compared with a loss of 562 cents for 2012, the first time the Anglo American unit fell into the red.

Headline earnings per share are the main profit gauge in South Africa. Amplats said its return to profit stemmed from higher sales volumes and a favourable rand-dollar exchange rate.

AMCU’s threatened strike could unravel its hard-fought return to profit, especially if it is protracted.

The chief executives of the three affected platinum producers said on Tuesday the industry could ill-afford further production and job losses, noting they had lost a combined 879,400 ounces of output to labour stoppages in 2012 and 2013.