Diversified miner African Rainbow Minerals (JSE:ARI) posted a 15-percent increase in first-half profit, supported by a strong performance from its manganese division, the company reported on Friday (March 16).
Headline earnings per share, the main profit measure in South Africa, surged to 1,023 cents (US$0.86) during the period. Headline earnings climbed from 1.693 billion rand a year ago to 1.945 billion rand, thanks in part to improved income from the manganese division.
As higher sales were achieved and alloy prices climbed, the company sold more high-grade manganese ore, increasing the division’s headline earnings by 131 percent year-on-year.
The company also declared a dividend of 250 cents (US$0.02) per share, totalling 549 million rand.
“We are pleased to have declared a maiden interim dividend and will continue to consider interim and annual dividends taking into account amongst things our financial position, the outlook for our operations and commodity markets, capital expenditure and growth,” African Rainbow said in a statement.
In terms of sales, manganese ore increased 10 percent from the year-ago period to 1.6 million tonnes, with 1.5 million of those tonnes being exported. Meanwhile, manganese alloy sales climbed 17 percent from H1 2017 to reach 162,000 tonnes.
Platinum headline earnings increased by 26 percent from the previous year to hit 226 million rand as the company’s Modikwa mine improved from a headline loss of 54 million rand to headline earnings of 36 million rand. Coal headline earnings increased to 160 million rand, with the Goedgevonden mine contributing 35 million rand.
As of 2:00 p.m. EST on Monday (March 19), shares of African Rainbow were down 7.29 percent, trading at 10,624 ZAC (US$8.82).
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Securities Disclosure: I, Nicole Rashotte, hold no direct investment interest in any company mentioned in this article.