Patrice Motsepe’s African Rainbow Minerals hit by Transnet crisis

African Rainbow Minerals (ARM) informed shareholders this morning that it expects a significant earnings decrease for the 2023 financial year.

In terms of JSE Listing Requirements, ARM released a trading statement today stating that a reasonable degree of certainty exists that the financial results for the period to be reported next will differ by at least 20% from those of the previous corresponding period. 

The company expects the following changes to its earnings for FY2023 compared to FY2022:

  • Headline earnings – decrease by between 18% and 27%
  • Basic earnings – decrease by between 33% and 42%

The company said the decline in FY2023 headline earnings was mainly due to lower commodity prices and lower production and sales volumes.

This was largely because of logistics challenges, which resulted in unit costs increasing by more than already elevated cost inflation.

However, the adverse impact on earnings was partially mitigated by the weaker rand versus US dollar exchange rate. 

ARM’s results for the financial year ended 30 June 2023 will be released on 4 September 2023.