Bad news for Amplats

Anglo-American Platinum warned shareholders of a fall in basic earnings of up to 2055% and a maximum 92% drop in headline earnings for its past financial year‚ due to impairments and write-offs of R14-billion and restructuring costs.

Amplats‚ which is 80% owned by Anglo American‚ said it would report a basic loss for the year to end-December of between R12.1-billion and R12.2-billion‚ compared with the previous year’s earnings of R624-million.

Its basic loss per share would be between R46.30 and R46.65‚ compared with earnings of R2.39 per share in the previous year.

The reason behind the dramatic decline was the impairment and write off of assets by R14-billion after tax‚ of which R1.8-billion affected headline earnings.

Headline earnings of between R60-million and R135-million were forecast – as much as 92% lower than last year’s R786-million. Headline earnings per share were forecast between 25c and 55c compared with last year’s R3.01.

Amplats will report restructuring costs of R850-million for the year as it cut support and service functions. Amplats is selling three mining operations around Rustenburg to Sibanye Gold for at least R4.5-billion.

Its Union mine is also up for sale.