Lonmin
Lonmin CEO, Ben Magara. Image: Lonmin

Lonmin generated unaudited operating profit of $70 million in the first six months of the year, compared to an operating loss of $32 million in the prior year period.

This statement comes from Lonmin CEO, Ben Magara.

“This was driven by higher PGMs basket prices and a favourably weaker Rand:Dollar exchange rate, on the back of broadly flat refined metal production volumes, despite lower mining output.

“The return to profitability and the new $200 million forward metal sale facility has improved Lonmin’s liquidity in the short term, with the early settlement of the term loan of $150 million in full and cancellation of all our other pre-existing undrawn facilities.

“However, despite the progress made, this does not provide a long-term solution to the capital structure challenges faced by Lonmin, as it is still inadequate to invest in the new projects necessary to avoid shaft closures and job losses and maintain our production profile.

“The Company’s available liquidity is also still vulnerable when considering its working capital requirements and continuing exposure to volatile currency and metal markets.

“Accordingly, we remain convinced that consolidation through the announced Offer from Sibanye-Stillwater creates the best way forward for our shareholders and all our stakeholders.”