JOHANNESBURG – South African miner Anglo American Platinum (Amplats) reported on Monday a 55% drop in first-half profits on lower sales, a stronger rand and tax impairments and said it is unlikely to pay a dividend this year. Its shares fell more than 3% after the results announcement.
Amplats, the world’s largest producer of the precious metal and a unit of Anglo American, has not paid a dividend since 2011, and would need to ensure its cash generation is stable in order to pay consistent dividends, chief executive Chris Griffith said.
Griffith said the company hoped to issue a dividend in its 2018 financial year.
Investors have been keen to know when Amplats will return to paying dividends.
“I don’t think we would be likely to see a dividend in 2017,” Griffith’s told Reuters on the sidelines of the company’s interim results presentation.
“What we don’t want to do is issue a dividend then find out the price is a bit worse then we don’t issue a dividend again.”
The platinum producers headline earnings per share (HEPS), the main profit measure in South Africa that strips out certain one-off items, fell to 285 cents for the six months ended June 30 from a restated 629 cents per share in the previous period.
“The lower earnings were as a direct result of lower sales volume from mined production and a weaker basket price compared to H1 2016,” the company said in a statement.
Amplats said post-tax impairments of R2.2 billion ($170 million) also impacted its earnings.
Its shares were trading 2.65% weaker at R303.65 at around 1000 GMT.
($1 = R12.9142)