Lonmin shares rise sharply on production report
SHARES in Lonmin, the world’s third-largest platinum producer, climbed more than 7% on Thursday after a positive production report, making it the biggest gainer of the day so far on the JSE.
At 11.31am, the counter was 7.02% higher at R48.13. That compares, however, with a record high of R623, reached in July 2007.
Lonmin said on Thursday that platinum sales in the December quarter, the first of its financial year, were 16.7% higher than in the same period a year before.
It reported sales of 108‚342oz in the quarter, while total platinum group metals sales dropped 3.7% to 182‚576oz.
At Lonmin’s Marikana operations, brought to a standstill last year by a violent strike that resulted in the deaths of more than 40 people, 2.7-million tons were mined in the quarter under review — down 26,000 tons, or 1%, from the same quarter a year before.
The miner said the prior year’s results were "unusually affected by the high incidence of section 54 safety reviews and stoppages that dominated the South African mining sector as a whole and resulted in lower than normal production in that period".
The total impact of section 54 shutdowns in the first quarter of 2012 was 177,000 tons, it said, compared with 19,000 tonnes in the first quarter of 2013.
It said production for the first quarter of the 2013 financial year also reflected the restart "and gradual ramping-up of production during the quarter.... In addition, management interventions have assisted in ensuring high levels of employee work attendance during the quarter up to the December break."
The dollar basket price at $1,176/oz improved by 3.5% compared with the prior year, while the increase in the rand basket price was more pronounced — up 10.3% to R10,152/oz.
Lonmin said for the full year it expected 680,000 platinum ounces of saleable metals in concentrate and sales of 660,000oz of platinum.
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