South Africa: Amplats' Production Up - but It Would Have Been Higher If Not for Eskom

analysis

Anglo American Platinum's production was up in the fourth quarter of 2019 as the company continues on a roll. It would have been even higher if it were not for Eskom.

Amplats has been on a roll of late, reaping the benefit of a profitable pivot to mechanisation and higher prices to produce big profits and hefty dividends. In July 2019, it unveiled interim results which showed a 120% rise in headline earnings to R7.4-billion. That came on top of an almost doubling of 2018 headline earnings which churned out R3-billion in dividends to shareholders. Not bad for a company that had struggled for years in the face of depressed prices and periodic bouts of labour and social unrest.

Ahead of the release of its full-year financial results, the company -- like the rest of the Anglo American stable -- has released its quarterly production report. Of key interest here is the impact of load shedding, which needs to be quantified as much as possible as it is the biggest threat by far to the overall economy.

Total platinum group metals production (PGM) rose 9% to 1,152,700 ounces. Platinum production was up 10% to 531,700 ounces, while palladium output also...

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