“Full year diluted headline earnings per share increased by 68.7 per cent to 136.3 cents from 80.9 cents the previous year,” said Northam in a statement
Northam said that owing to the continued uncertainty prevailing in the mining industry and the cash requirements for the completion of the Booysendal mine, the board did not declared a final dividend for the 2013 financial year.
“Despite the challenging conditions of mining in South Africa, which included labour disruptions at the Zondereinde mine in April 2013 and the continued low levels of demand for platinum group metals globally, mainly due to the debt-ridden Eurozone, it has posted improved results year on year,” Northam said.
The results are on the back of higher sales volumes from Zondereinde combined with the weakness of the rand which contributed to a 20 per cent increase in sales revenues to 4.4 billion rand compared to 3.7 billion rand the previous year.
Northam said that the higher sales revenues reflect the increased metal sales which were up by 7.3 per cent to 10,704kg compared to 9,980kg posted the previous year, boosted by a 13.5 per cent weakening of the rand against the US dollar over the period, from 7.77 rand per US dollar in last year to 8.82 rand per US dollar.
The average US dollar price realised during the current period declined by 5.1 per cent from 1 345 UD dollars per ounce to 1 276 US dollars per ounce.
“Cost of sales increased by 14 per cent to 3.8 billion rand from 3.3 billion rand reflecting the higher volumes sold and higher operating costs. Operating costs increased by 7.3 per cent owing to higher labour and power costs which are the most significant components contributing to mining inflation in South Africa. Cost of sales was also adversely impacted by a 60.6 per cent increase in refining costs owing to a weaker exchange rate and the outsourcing of smelter services,” said Northam
Northam said that production was badly impacted by a three-week strike by rock drill operators (RDOs) as advised to shareholders on 5 April 2013. Their dispute was centred on the payment methodology of production-related bonuses.
These differences have since been resolved by management and the RDOs. The company announced that wage negotiations for financial year 2014 have begun with the majority union at Zondereinde.
Northam said that all mining operations are finite in their nature and the operations of mines are dependent on, inter alia geological, technical as well as economic factors such as commodity prices and exchange rates.
“The outlook for the local as well as the global economy remains uncertain. Although there are signs that the United States is emerging from recession, and the Chinese economy seems to be recovering, Europe still remains in a debt induced recession,” Northam said
Labour disruptions in South Africa loom large as wage negotiations begin for the 2014 financial year.