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Impala Platinum said its annual loss will widen as the world’s second-largest producer of the metal takes a R9.7 billion ($660 million) writedown, mostly on its struggling Rustenburg mining complex.

Implats, as the company is known, is shrinking the number of shafts at Rustenburg and said earlier this month it may cut about 13 000 jobs as focus shifts to newer, lower-cost mines. The company has struggled to reduce expenses at Rustenburg and profit margins in the platinum industry have come under added pressure this year after prices for the metal sank to the lowest in a decade.

Implats will report a full-year loss of R10.17 billion to R11.68 billion, the Johannesburg-based company said in a statement Monday. That compares with an R8.2 billion loss a year earlier.

The company’s shares declined 1.8% by 4:29 p.m. in Johannesburg.

Implats isn’t the only one taking drastic steps. Rival Lonmin has embarked on plans to cut 12 600 jobs and close old, unprofitable shafts and has pinned its future on a pending merger of assets with Sibanye Gold.

Impala said its so-called headline loss, which excludes some one-time items, will be R1.16 billion to R1.34 billion, compared with a loss of R983 million a year ago. Refined platinum production likely declined 4%, mostly due to a build-up of inventory, and concentrate platinum output is seen 1% higher, the company said.

 

 

 

 

-Bloomberg

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