Kumba Iron Ore, Africa’s biggest producer of the steelmaking ingredient, said first-half profit fell as much as 63% after prices of the steelmaking ingredient declined.
So-called headline earnings, which exclude one-time items, will drop to a range of R2.4 billion ($194 million) and R2.6 billion, or R7.50 and R8.05 a share, in the six months through June 30 from R6.51 billion, or R20.28, a year earlier, the Pretoria, South Africa-based unit of Anglo American said in a statement Wednesday.
“The significant decrease in export iron-ore prices is largely responsible for the decrease in earnings,” the company said.
Iron ore dropped 37% in the year ended June 30 due to a surplus that emerged after the largest miners including Rio Tinto Group, BHP Billiton and Fortescue Metals Group invested billion of dollars to boost output, exacerbating a glut as China, the biggest buyer, grew at the slowest pace in more than two decades.
Kumba closed 6.57% higher at R132.40 in Johannesburg.
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