Platinum is in the spotlight on worries about South African production and disappointing results from a major producer.
Aquarius Platinum has fallen 5.9p to 156.6p after the company said revenues for the six months to December fell 25% to $253m, with production down 14% after safety stoppages and other problems at its South African mines. It made a loss of $113m including a $91m foreign exchange loss. Chief executive Stuart Murray said:
Our financial results do no more than reflect the ongoing difficult operating and trading conditions facing the company and the southern African platinum industry.
At our results for...December 2010 I said we were through the worst and thought the bottom was behind us in this sector. I could not have been more wrong.
Andy Davidson at Numis Securities said:
[The] interim results makes uncomfortable reading, with operating costs appearing higher than consensus. Well-flagged operational issues and lower quarter on quarter production were highlighted in the second quarter production report – the higher mining costs and lower realised platinum group metal prices are brought out here.
Meanwhile Lonmin might have to review its 2015 targets if safety stoppages and strikes continued to hit South African production, the company told Reuters. Its shares are flat at £10.51.
