African Rainbow Minerals (ARM) lifted up headline earnings for the year to the end of June by 19% to R3.2 billion, having received 113% firmer dividends from Harmony Gold at R512 million.
There were however impairments related to reversals on property, plant and equipment at Assmang amounting to R10m before tax of R5m, as well as another impairment reversal of the investment in Sakura at Assmang of R29m.
ARM suffered an additional R3m in impairments on reversal on property, plant and equipment at Machadodorp.
“The increase in headline earnings was primarily driven by higher US dollar PGM basket prices, partially offset by lower average realised rand iron ore prices and lower local sales volumes at Beeshoek Mine,” said ARM chief finance officer, Tsundzukani Ta Mhlanga.
Average realised rand exchange rates for the period firmed up 7% to R16.88/US$ compared to the previous year.
ARM nonetheless paid a final dividend of R7.00 per share compared to R6 in the year earlier period, bringing the total shareholder payout for the year ended 30 June 2026 to R12.00 per share.
This was after net cash improved by R3 562 million to R10.1bn, with revenues closing the year under review 25% stronger at R16.3bn.
The net cash held by ARM as at the end of June excludes attributable cash and cash equivalents held at ARM Ferrous of up to R3.9bn.
The company repaid R1.89bn of its borrowings and did not contract any new debts during the period. By the end of June, R157 million in gross debt remained on its balance sheet.
“Continued collaboration with Transnet via the Ore Users Forum and Manganese Producers Consortium advanced rail and port reforms on the Saldanha and Ngqura corridors, delivering a 1% improvement in export rail performance and enhancing the long-term competitiveness of South African producers,” said ARM CEO, Phillip Tobias.
He added that manganese ore producers in South Africa, in collaboration with Transnet Rail Infrastructure Manager (TRIM), are engaged in efforts to raise rail and port capacity to the Port of Saldanha.
Transnet is expected to issue a request for qualification for the design, build, construction and the operator of the new Ngqura Manganese Export Terminal, alongside other Gqeberha manganese ore rail interventions.
Firmer precious metals prices played to the advantage of ARM during the year to June. For example, US dollar platinum group metals prices for Two Rivers and Modikwa Mines increased by 68% and 65%, respectively.
Two Rivers raised headline earnings by over 200% to R1.2bn mainly due to the firmer PGM rand prices despite a marginal decrease in production.
Modikwa raised similar headline earnings, with the ARM board approving Bokoni’s 180 000 tonnes per month development project.
The company’s PGM operations started receiving up to 50 megawatts (MW) of renewable energy from December, with the full 100MW export capacity, expected once grid upgrades are completed in the first quarter of its current year.
Gold prices have remained elevated, helping with stronger dividend receipts from Harmony Gold.
Nonetheless, earnings at Khumani iron ore open cast mine were adversely affected by the stronger average realised rand versus the US dollar. ARM’s iron ore volumes for the period were subdued due to the placement of the Beeshoek Mine under care and maintenance in October last year.
ARM’s coal mining operations reported a headline loss of R428m, mainly driven by a decrease in the realised coal price as well as the average realised rand strengthening by 7% versus the US dollar during the period. The Goedgevonden Coal Mine recorded a headline loss of R73m while PCB recorded a headline loss of R355m.
tawakarombo@yahoo.co.uk