Implats, one of the world’s largest platinum producers, has reported a strong operational performance for the first half of its 2024 financial year, despite the low prices of platinum and other metals. The company said it had achieved record production levels, improved safety standards, and reduced costs, while maintaining its financial stability and sustainability.
The company, which operates mines in South Africa and Zimbabwe, said it had produced 1.4 million ounces of platinum and 2.9 million ounces of platinum group metals (PGMs) in the six months ended December 31, 2023, representing a 10% and 9% increase, respectively, from the same period in 2023. The company attributed the increase to the ramp-up of its new projects, the recovery from the COVID-19 disruptions, and the optimization of its operations.
The company also said It had improved its safety performance, recording zero fatalities and reducing its lost-time injury frequency rate by 18% to 2.63 per million man-hours. The company said it had invested in the health and well-being of its employees and communities, and had implemented strict protocols and measures to prevent and contain the spread of COVID-19.
The company said it had reduced its unit costs by 6% to R12,987 ($870) per platinum ounce, and its capital expenditure by 9% to R2.6 billion ($174 million), while generating a positive free cash flow of R5.9 billion ($395 million). The company said it had maintained a strong balance sheet, with a net cash position of R7.8 billion ($522 million), and had declared an interim dividend of R10 ($0.67) per share.
However, the company said it had faced a challenging market environment, as the prices of platinum and other metals had declined due to the weak global demand and the oversupply. The company said the average realized price of platinum had dropped by 18% to $861 per ounce, while the average realized price of PGMs had fallen by 12% to $1,887 per ounce, in the six months ended December 31, 2023.
The company said the low prices had affected its profitability and margins, and had resulted in a 16% decrease in its revenue to R42.9 billion ($2.9 billion), and a 25% decrease in its headline earnings to R6.8 billion ($455 million), compared to the same period in 2023.
The company said It expected the prices of platinum and other metals to remain subdued in the short term, due to the uncertainty and volatility caused by the COVID-19 pandemic and the global economic slowdown. The company said it was closely monitoring the market conditions and the demand and supply dynamics, and was adjusting its production and sales strategies accordingly.
The company said it was confident in the long-term outlook and potential of the platinum and PGMs industry, as the metals had a vital role to play in the transition to a low-carbon and green economy, and in the development of various technologies and applications, such as fuel cells, hydrogen, and catalytic converters.
The company said it was committed to delivering value to its shareholders, stakeholders, and society, and to pursuing its vision of becoming a world-class platinum and PGMs producer. The company said it was focused on enhancing its operational excellence, innovation, and sustainability, and on exploring and developing new opportunities and markets for its metals.
Despite the challenges, some experts say there is still hope for Implats and the platinum and PGMs industry, if the company and the sector continue to improve their efficiency and competitiveness, and to leverage the opportunities and the advantages that the metals have. They also say that the company and the sector have the potential and the resources to become a leader and a model in the mining industry and the economy, in terms of safety, quality, and social responsibility.
Source: Mining Weekly
