Angloplat to reduce mine jobs by 10 000
February 10, 2009 Edition 1
Justin Brown
Anglo Platinum (Angloplat) planned to slash 10 000 jobs at its mines before the end of this year, the platinum producer said yesterday.
The jobs cuts are a result of the decline in platinum group metal (PGM) prices, which prompted the company to reduce this year's capital expenditure by 50 percent to R9.1 billion. Angloplat employs about 80 000 contract and permanent employees.
Chief executive Neville Nicolau said there was likely to be little cost involved in cutting back 8 000 contractors, while the 2 000 permanent jobs would be shed through natural attrition. He said that 5 percent of the 40 000 permanent jobs at Angloplat were turned over each year.
Angloplat would avoid retrenching permanent staff by freezing non-critical appointments, halting overtime as well as reskilling and redeploying existing staff, he said.
Given the tough economic conditions, Angloplat said that it would not be paying a final dividend this year. The group's total dividend last year fell by 33 percent to R35 a share.
The group reported yesterday that it produced 2.39 million ounces of platinum last year and sold 2.2 million ounces.
Nicolau said Angloplat was aiming to produce and sell 2.4 million ounces of platinum this year. Unit operating costs per equivalent refined platinum ounce had rocketed 35.6 percent last year.
"Unit costs remain at unacceptable levels," he added.
He said the company would keep its unit cost increases this year to no more than inflation.
Bongani Nqwababa, the company's financial director, said that revenue last year rose 9 percent to almost R51 billion because of the high PGM prices in the first half, but gross profit margin fell from 41 percent to 33.7 percent.
The company's headline earnings rose 8 percent to R13.3 billion compared to the previous year.
Last year, Angloplat's capital expenditure rose by 35 percent to R14.4 billion compared with the previous year. The net debt position rocketed by 229 percent to R13.5 billion after the group paid out R14.2 billion in dividends and spent R14.4 billion on capital.
Nicolau estimated that total South African platinum production fell last year by 6 percent to 4.71 million ounces and forecast that it would be the same this year.
