Johannesburg, South Africa — MININGREVIEW.COM — 03 March 2011 – South Africa’s Merafe Resources “’ the country’s largest ferrochrome producer “’ has reported a return to full-year profit, assisted by higher metal prices, and has said that it expects strong results ahead.
Demand for ferrochrome, which is used in stainless steel to prevent corrosion, is recovering after the global economic crisis forced companies in top producer South Africa to slash output in 2009.
Merafe, which operates a joint venture with Xstrata, said headline earnings per share for the year to 31 December 2010 had totalled 11 cents, from a loss of 6 cents a year earlier.
The company stated that its share of saleable ferrochrome output for the year rose to 291 000t from 281 000t in 2009, while revenue increased from R1.84 billion to R2.56 billion. Merafe added that it expected ferrochrome prices to trade higher in 2011 on upward demand arising from growth in stainless steel production.
The company also pointed out that restricted supply of electricity in South Africa had resulted in the postponement of a number of planned ferrochrome projects over the next five years. Merafe declared a final dividend of 2 cents a share.