Implats earnings take a dive – but RBPlat offers hope

Impala Platinum saw a massive earnings decrease over the past financial year. Still, its recent acquisition of Royal Bafokeng Platinum (RBPlat) could see the platinum producer win back some lost ground.

Implats, one of the country’s largest platinum producers, released its results for the year ended 30 June 2023 today.

In FY 2023, Implats saw a 9.9% decrease in revenue and an 81.4% decline in profit for the year.

The company’s earnings also took a significant hit in the period.

EBITDA declined by 32.5%, basic earnings per share dropped by 85%, and headline earnings per share fell by 42.6%.

Implant’s free cash flow also dived, declining from R28.84 billion in FY 2022 to R14.17 billion – a 50.9% decrease.

The company missed its production forecast in the year, with its refined platinum group metal (PGM) output declining by 4% to 2.9 million oz.

Implats largely attributed these declines to the local macroeconomic environment, including load-shedding, the weakening rand, and weaker metal prices.

“Notable rand depreciation compounded the impact of high consumable and utilities inflation on the translated cost and capital expenditure at Zimbabwean and Canadian operations,” the company said.

However, Implats completed its acquisition of Royal Bafokeng Platinum in the period, which will soon be delisted from the JSE and renamed ‘Impala Bafokeng’.

Implats said this acquisition would “materially alter” the company’s production profile and raised its production forecast for FY 2024.

In addition, “group production in FY 2024 will be supported by volume gains from increased milling capacity at Zimplats and Two Rivers, while the improved operational stability established at Impala Rustenburg and Impala Canada bodes well for further efficiency gains”. 

The company expects its platinum group metals refined production to be between 3.30 and 3.45 million oz in the next financial year.