Anglo American Platinum reports drop in H1 profit

Underlying earnings at Anglo American’s South African platinum division fell in the six months ended 30 June, partly on the back of lower metals prices.

Headline earnings for the period were down 58% from the first half of 2015 to 1.04bn rand.

Sales revenues rose 3% to ZAR30.7bn and the company reduced net debt by ZAR2.9bn to ZAR9.9bn.

Anglo said platinum group metals pricing remained weak, with the average US dollar basket price per platinum ounce sold falling by 24% in the first half of the year $1,632, versus the $2,157 in 2015.

The company said the drop in US dollar metal prices was partly offset by a weaker rand.

Platinum production was up 2% on the comparative period to 1.15m ounces.

Chief executive officer Chris Griffith said: “We are delivering on our promises and making progress on our value driven strategy. Despite the weak PGM pricing environment, operational excellence resulted in ZAR3.2bn of free cash flow generated across the portfolio and a net debt reduction of ZAR2.9bn.

“We remain focused on cash conservation and disciplined capital allocation, whilst continuing to prepare for the future through market development with our strategic partners, modernising through innovation in mining and processing technology and we are ensuring a productive and engaged workforce that live in stable host communities.”