CHRIS Griffith, the Kumba Iron Ore CEO who takes up leadership of Anglo American Platinum (Amplats) in September, has said the prospect is daunting, but he has the support of the company's largest shareholder to make the changes that are necessary.
Anglo American, which owns 80% of Amplats and 70% of SA's largest iron ore producer, Kumba Iron Ore, made sweeping changes in the leadership of its South African businesses after Neville Nicolau stepped down with immediate effect as CEO of Amplats, which will report sharply lower profits today.
Mr Griffith is a platinum veteran, having spent 18 years at Amplats before being assigned to Kumba four years ago. With the favourable tailwind of high iron ore prices and strong demand for the key steel ingredient, he managed one of the most successful businesses in the Anglo stable.
He returns to Amplats on September 1 to a very different business to the one he left. The industry has seen a number of casualties, with high costs eroding profits as the price of the metal in rand terms remains static. The industry is also beset with operational problems and a clampdown on safety by the government, resulting in temporary shaft closures and lost production.
"It's a daunting prospect because it's not just a company that's battling, the industry is battling. I'm sure the cycle will turn again and I see hope for the platinum industry," Mr Griffith said.
Amplats is halfway through a review of its business, making analysts question the timing of Mr Nicolau's departure last Thursday, ahead of the announcement of the group's results today.
Anglo CEO Cynthia Carroll said last week Mr Griffith's experience in the platinum industry and his ability to step into the review process at this stage was a factor in his appointment.
"Anglo has given me the support and undertaking that I would have enough time to work with Anglo and the review team to come up with a strategy," Mr Griffith said. "We wanted the new CEO to have the ability to work with the review team and the board to agree on a strategy going forward. I'm pleased I have the ability to form part of the design on that process."
Asked about the relationship he has with Ms Carroll, who is also chairwoman of Amplats, he said: "It does us, Cynthia and me, no harm that we have a good relationship. She's been very supportive of Kumba and of me. I'm very pleased I have her support going into platinum. You need board and major shareholder support for something you're trying to drive in very difficult market circumstances," he said.
Amplats said on Friday its June quarter production was unchanged at 584000oz of equivalent refined platinum from its and joint venture partners' mines.