You are currently viewing our desktop site, do you want to download our app instead?
Moneyweb Android App Moneyweb iOS App Moneyweb Mobile Web App

NEW SENS search and JSE share prices

More about the app

AngloGold Ashanti bumped off list of Top 10 mining companies

Replaced by Royal Bafokeng Platinum as platinum, iron ore and coal now dominate the mining landscape.
Strong iron ore price movements saw Kumba move up to second place. Image: Bloomberg

The once mighty AngloGold Ashanti has been bumped off the list of SA’s Top 10 mining companies, replaced by Royal Bafokeng Platinum, according to the PwC SA Mine 2021 report released on Tuesday.

“The gold sector experienced the largest negative share price movements as a result of the declining gold stocks and lack of investor confidence in the precious metal,” says the report.

“In addition, gold was also ranked as the least preferred commodity in June 2021 and this is reinforced by the drop in position by AngloGold Ashanti and Gold Fields.”

Market cap of Top 10 mining companies

Source: EquityRT, Iress, PwC analysis

Strong iron ore price movements saw Kumba Iron Ore move up to second place, on the back of its record financial performance.

In terms of ranking, Impala Platinum was the biggest climber, moving from sixth place to replace AngloGold Ashanti in the top three, after its market capitalisation more than doubled between June 2020 and June 2021.

Read: PGMs boom powers Implats to bonanza profits

In addition to Impala Platinum, Sibanye-Stillwater moved from fifth place to fourth place. Both these improvements in ranking are attributable to the favourable platinum group metal (PGM) prices.

Higher prices for PGMs and iron ore were the main drivers behind the 63% jump in mining revenue for the year to June 2021, according to the report.

Sector shows resilience

Mining was among the most resilient sectors in the SA economy, benefitting from a 71% average increase in PGM prices and a 48% increase in iron ore prices. These higher prices helped offset the drop in production that occurred at the start of the hard lockdown in March 2020.

There was a 13% increase in mining production over the previous year, with diamonds, manganese ore and chromium leading the way. Diamond production was up 30% year on year, while coal was down 6%.

Iron ore prices increased by more than 200% from the prior year and this was largely driven by China’s rapid economic recovery and subsequent reopening of other global steel markets.

Another sign of the health of the sector is the level of dividends paid to shareholders.

A total distribution of R76 billion was made for the year to June 2021, up from R43 billion the prior year. Impala Platinum paid a dividend of R11 billion (2020: R0.9 billion) for the year to June 2021, while Kumba gave R25 billion (2020: R19 billion) to shareholders.

Dividend yield

Source: Stats SA, PwC analysis

Though gold mining companies struggle to make it onto the list of the Top 10 companies ranked by market cap, Harmony increased revenue by 42%, due largely to a 26% improvement in production and a higher average rand gold price.

“The excellent financial performance resulted in mining companies being in a very strong financial position,” says Andries Rossouw, PwC’s Africa energy, utilities and resources leader.

“Debt has largely been repaid and returns to shareholders reached record rand levels for many companies. The fiscus benefitted from increased direct and indirect taxes and mining royalties to the extent that it could support ongoing socioeconomic support during the pandemic.

“The remaining free cash flow and available cash resources leave mining companies with interesting capital allocation decisions,” adds Rossouw.

“Strategies will include expansions and new development, acquisitions, strengthening of local infrastructure and host communities, market development, and investments up and down the value chain. Execution on these strategies will require disciplined long-term sustainable mindsets.”

Please consider contributing as little as R20 in appreciation of our quality independent financial journalism.

AUTHOR PROFILE

COMMENTS   10

Sort by:
  • Oldest first
  • Newest first
  • Top voted

You must be signed in to comment.

SIGN IN SIGN UP

Resources companies have paid astronomical dividends to shareholders this year. This is great news for investors.

And no doubt, resources company executives will be rewarded with increased bonuses.

But despite super profits this year, resources companies have forgotten about the mine workers who have toiled during these difficult times.

Mine workers are still underpaid and deserve better salaries.

The resources companies need to find a balance between increased profitability and social responsibility.

Do you or anybody else know what the salaries of mine workers are and how it compares with international miners?

International miners are more productive and more skilled than local miners, so take that into account. You thus require less human resources, or the headcount is lower.

Use Australia as an example, a miner is a diesel mechanic and a tractor or bulldozer driver also, so they will do more than one task or job in the same day.

As for Anglo God, they have a new CEO and the Gold mine in Ghana will start operating in a weeks’ time. That is an extract 200,000 O/Z of Gold per year , roughly R6 Billion per year of Gold.

Plus the new CEO has bought some shares in ANG with his own money, that says a lot about his confidence in the company.

I support this one.

Yeah, whats the salary ratio between the CEOs and their average workers between SA and Aus?

Implats CEO cashed in R88M worth of shares 6 months ago. Hmmm, I guess he deserved every cent in a PGM bull market.

The Ghana partner, Sir S Jonah, needs to be investigated by the ICC.

One should never forget that the government is indeed a shareholder and the recipient of the biggest dividend. They take 28% of the profit after all expenses/running of the company/risks taken and avoided etc. It is called company tax. After SAA and many more they should know that running a company is not that easy – if you argue it should be run at a profit and not with tax payers money.

On the other hand the minerals in the ground do belong to the country and therefore it is fair that the country, represented by the government, should receive a dividend (tax). How well the ANC government uses the dividend (tax) is another debate.

Well Gordon ,: the tax appears to support sections of the motor industry ,namely Merc and BMW ,judging by the ANC,s fleet .
I wonder why they don’t change to HAVAL in honour of their comrades . ?

Ha, ha, ha..I never thought about that.

The negative sentiment towards gold is reflected by the comparison of the US gold mining index and the $gold price as at the find for..
el834862649 Gold Miners Index
Look closer and see the indicators for a turnaround spluttering into focus.

End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

SEARCH COMPANIES
Enter company name or share code:

ECONOMIC DATA  

  CPIThe Consumer Price Index (CPI) measures monthly changes in prices for a range of consumer products Sep 2021 5.00%
  CPI ex OERThe Consumer Price Index excluding Owners’ Equivalent Rent (CPI ex OER) measures monthly changes in prices for a range of consumer products excluding Owners’ equivalent rent that measures changes in the cost of owner-occupied housing Sep 2021 5.50%
  RepoThe rate at which the Reserve Bank lends money to the country’s commercial banks and set by the Reserve Bank’s Monetary Policy Committee. Oct 2021 3.50%
  Prime lendingThe Prime Lending Rate is the rate of interest that commercial banks will charge their clients when issuing a loan (home loan or vehicle finance) Oct 2021 7.00%
INSIDER SUBSCRIPTIONS APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING PORTFOLIO TOOL CPD HUB

Follow us:

Search Articles:
Click a Company: