|
|
|
Fri 15 Sep 2023
Close: 3 750c 
Day's move: 0c (0.00%)
Volume: 0
Trades: 0
|
|
|
|
Revenue for the interim period went down 29% to R5.8 billion (2022: R8.2 billion) and gross loss worsened by 114.2% to R394.9 million (2022: gross profit of R2.8 billion). Loss for the period weakened by 115.3% to R339.6 million (2022: profit of R2.2 billion). In addition, headline loss per share moved down 114.8% to 113.8 cents per share (2022: headline earnings of 767.3 cents per share).
Interim dividend
No dividend has been declared or proposed in the current period (2022: 245.0 cents).
Company outlook
The PGM basket price trended lower during the first six months of the year. Rhodium, which has been the largest driver of the basket price in the recent past is now below USD5 000/oz, a more than 80% decrease from its record high of USD29 800/oz in March 2021. Lacklustre automotive demand and stock sales in the fibreglass industry contributed to the rhodium price weakness. Despite the depressed prices of rhodium, palladium and platinum, there was an increase in the contribution of minor metals to the basket price. However, this and the weaker rand were not enough to offset the downward trend. The rand weakened to its lowest level in recorded history against the dollar during the first half of the year, however, by the end of the reporting period it had recovered from these levels.
There was an increase in light-duty vehicle production in the first half of the year, with growth forecast to continue for the rest of the year. However, most of the growth will come from electric vehicles (EVs) which does not bode well for palladium demand. In June, China unveiled its stimulus plan for New Energy Vehicles (NEVs), extending the previous package which was due to expire at the end of 2023. Plug-in hybrid electric vehicles (PHEVs) which contain autocatalysts are included in the plan. Automotive demand for platinum is forecast to increase this year driven by the partial substitution of palladium with platinum in tri-metal catalysts in light-duty gasoline vehicles and an increase in heavy-duty vehicle production. Palladium and rhodium automotive demand is forecast to be weaker. The implementation of stricter emissions legislation in China, India and Europe is not anticipated to increase PGM loadings significantly as OEMs are expected to be able to meet the tougher standards with marginal changes to loadings. Industrial demand for platinum is expected to increase driven by a rebound in the glass and chemical sectors. Global demand for platinum jewellery is predicted to decline largely due to the decrease in Chinese demand, which offsets the expected increase in demand in other regions.
The availability of electricity is a major threat to South African PGM production. At the beginning of the year mining companies stated that up to 15% of their production could be lost due to the higher stages of load shedding. In the first half of the year, load curtailment impacted concentrating and smelting activities leading to an increase in inventory. Mine supply is still forecast to grow in 2023 however, Eskom load curtailments remain a downside risk. Russian PGM production for 2023 has been guided lower with supply chain constraints remaining a threat to supply. Secondary supply is forecast to increase marginally, however, lower PGM prices are a downside risk as they may lead to hoarding.
The outlook for platinum is more positive compared to palladium and rhodium. Platinum is expected to be in a deficit in 2023 supported by a recovery in vehicle sales, substitution of platinum for palladium in light-duty vehicles and an increase in industrial demand. Despite the increase in electrification of vehicles and substitution, palladium is forecast to be in a small deficit this year. Rhodium is also expected to be in a slight deficit.
|
| |
| Click here for Results In Brief |
| |
| Click here for Results Analysis |
| Closing price data source: JSE Ltd. All other statistics calculated by ProfileData. |
|
|
