Harare - JSE-listed Anglo American Platinum (Amplats) closed out 2018 with another strong, solid, profitable performance. The numbers, and the information provided on the earnings call imply Amplats is fully charged to posts impressive results in 2019. Yet consensus platinum group metal (PGM) production guidance seem light for 2019, although the company is likely to achieve another stellar overall performance.
Amplats forecast its full year platinum production guidance lower to between 2.0-2.1 million ounces, compared to 2018 forecasts of 2.3-2.4 million ounces, which was later on revised upwards to between 2.4 million and 2.45 million ounces in the 2018 first quarter.
Likewise, PGM production guidance (metal in concerntrate) is between 4.2-4.5 million PGM ounces for 2019, which is lower than PGM production guidance set between 4.75-5.0 million PGM ounces for the previous year.
“Lower production versus 2018 reflects the Sibanye-Stillwater material changing to a tolling contract from 1 January 2019, and therefore refined metal is returned to Sibanye-Stillwater,” said the Group’s chief executive officer Chris Griffith.
“Refined production will be higher at 4.6-4.9 million PGM ounces for 2019, including platinum for 2.2-2.3 million ounces and palladium of 1.4-1.5 million ounces.”
The palladium production outlook is also lower than 2018 production guidance which was set at 1.5 million to 1.6 million ounces.
During the year ended December 2018, Amplats delivered 5.3 million ounces of PGMs, an increase of 4% from 5.1 million ounces achieved in 2017. Net debt was cut by R4.7 billion and the price of the company’s basket of metals increased by 13%, buoyed by palladium averaging $1 029 per oz and rhodium $2 200 per oz.
Griffith said this performance was buoyed by exceptional performances from Mogalakwena, in Limpopo as well as supported by strong performances from Kroondal, in Rusternburg and Unki, in Zimbabwe.
Production at Unki in the year under review increased to 85 900 ounces up from 74 600 ounces recorded in 2017, largely driven by an improvement in operational efficiencies.
Billed as the best-performing share on the JSE All Share Index in 2018, Amplats has also managed to pay out a massive total of R3 billion cash in dividends in the year ended December, 2018.
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