Johannesburg, South Africa — 16 July 2013 – Anglo American Platinum Limited (Amplats) “’ the world’s biggest producer of the precious metal “’ has revealed that its first-half profit almost doubled from a year earlier after the rand weakened, curbing the impact of cost increases in South Africa.
Earnings per share excluding one-time items probably rose to a range of R4.80 to R5.35 in the six months through June, compared with R2.73 a year earlier, the Johannesburg-based company said in a statement. The stock climbed as much as 2.6%, the most in a week, reports Bloomberg News.
The price of platinum declined 0.5% to an average US$1,549/oz in the first half compared with a year earlier, while the rand depreciated 14% against the dollar, making it the worst performer among 16 major currencies tracked by Bloomberg. The currency swing has helped Amplats offset above-inflation gains in costs such as electricity and wages.
“The rand has obviously bailed these guys out quite a lot,” said Justin Froneman, a Johannesburg-based analyst at Standard Bank Group Limited securities unit, who has a hold rating on the stock. “The market was possibly anticipating slightly weaker results.”
The shares advanced as much as 2.6% after the announcement and traded 2% higher at R296.98 by 12:25 p.m. yesterday in Johannesburg, heading for the strongest closing level since June 19.
Basic earnings per share for the first half will probably increase to between R4.50 and R4.86 compared with a loss of R1.78 in the same period in 2012, Amplats said in the statement.
“It’s difficult to get a read on what this means operationally as there are quite a lot of working-capital adjustments in the background that one needs to be aware of,” Froneman said.
Amplats is scheduled to release its full earnings report on or about July 22.
Source: Bloomberg News. For more information, click here.