Johannesburg, South Africa — MININGREVIEW.COM — 20 February 2009 – Mining holding company Assore – listed on the JSE – says its headline earnings for the six months to 31 December 2008 increased by 357% to R2 976.7 million, due to the significant increase in the earnings of Assmang Limited (Assmang), and the increased commissions earned on the higher sales of group products.
Assore’s principal investment is a 50% interest in Assmang, which it controls jointly with African Rainbow Minerals (ARM).
An Assore statement released here revealed that Assmang’s headline earnings had increased by 391% to R5 628 million compared to the same period of the previous year, despite lower sales volumes for all products except iron ore. The significant increase in earnings was attributable to substantially higher US Dollar prices for all products, and a weakening of the SA Rand against the US Dollar, particularly in the second fiscal quarter.
The statement added that Assmang’s turnover for the period under review had reached a record level of R10.9 billion (2007: R4.4 billion). However, with the exception of iron ore, sales volumes for all products had been lower compared to the same period for the previous fiscal year.
It revealed that major capital expenditure had occurred in the iron ore and manganese divisions. A total of R664 million had been spent on infrastructural items at the new Khumani iron ore mine, with a further R126 million spent on housing in the iron ore division. An amount of R140 million had been approved to rebuild furnace 6 at Cato Ridge, of which R87 million had been spent to date.
It is expected that the feasibility study to expand Khumani’s annual capacity to 16 million tonnes will be complete by May 2009, while negotiations are being finalised with Transnet to increase Assmang’s annual export allocation on the Sishen/Saldanha line to 14 million tonnes per annum.