Northam Platinum has recorded its first operating loss since 1998 following the 11-week strike at its Zondereinde mine, one of the longest in the South African labour environment. The JSE-listed platinum mining company saw its production at Zondereinde slashed by almost 30% to 3 477kg.
“It is probably worth reminding our stakeholders that by the time employees proceeded on strike action on 3 November 2013 our offer was already equal to or better than any other settlement the NUM had agreed to in the mining industry,” said Glyn Lewis, Northam CEO.
“I am sure that, after 11 lean weeks, a lot of questions remain about the wisdom of this move, given the final settlement. Apart from the serious losses incurred by the company and shareholders, employees also lost R151 million in wages.
“We hope that common sense will prevail sooner rather than later in the current impasse in the platinum sector. Perhaps there is also some merit in an overhaul of some of the legislation surrounding industrial action.
“We believe, for example, that this should include the introduction of an independent strike ballot process, and that strike action should only proceed if the overwhelming majority of all union members vote in favour of strike action. Furthermore, the validity of a strike certificate should be limited to one week.”
Social and economic uncertainty is likely to continue to influence the fortunes of the platinum industry in the near future. Barring any disruptions to Northam’s operations in the second half of the financial year, the Zondereinde mine is expected to recover to a steady state of production and the Booysendal mine to continue its production build-up. The financial performance of the company for the full year however, will be negatively impacted by the 11 week strike which ended on 21 January 2014.