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Afrimat - business update and pre-close briefing
The 2025 financial year ("FY2025") was a difficult year for Afrimat, resulting in a decrease in base returns that shareholders had been accustomed to. The first quarter ("Q1") of the 2026 financial year ("FY2026") was a continuation of the previous year, but by the second quarter ("Q2"), the Group noted improvements across several key areas.
These included:
• Operational improvements at Nkomati were achieved
• Significant increase in local iron ore sales volumes
• International iron ore sales were satisfactory
• Marked improvement in aggregate sales volumes, together with further value unlock across the aggregate's businesses
• Preferred bidder, for quarries that are required to be sold, has received financial approval from financiers
• All Holcim information systems successfully migrated onto the Afrimat system, resulting in substantial monthly cost savings
Company prospects
Looking forward, our focus remains on eliminating operating losses in the cement operation and unlocking the potential we recognise is present. We will continue differentiating the cement business through the expansion of the cement extender and innovative cement products. A detailed strategic review of the kiln performance is taking place.
In the aggregates business, we will continue the focus on improving the quarry margins.
Afrimat anticipates domestic iron ore sales to be slightly lower across the second half of the financial year, if Newcastle closes. International iron ore sales are expected to remain similar to the previous year.
Within anthracite, the focus remains on increasing exports and keeping local take-off as consistent as possible. However, local sales are uncertain given the closure of ferrochrome smelters in South Africa.
It is not tariffs from America that will count against us, but rather the lack of protection, infrastructure investment, and maintenance that is putting immense pressure on our customers. We will continue to support our customers while also exploring alternative markets. This is a strength of our Business Development team, as they work closely with the businesses to find alternative routes to markets, whether in South Africa or elsewhere.
Pre-close briefing session
Afrimat shareholders were advised that the Company will host a pre-close briefing session relating to its business activities for the period ended 31 August 2025 via a virtual discussion from 11:00 to 12:00 on Friday, 29 August 2025.
Shareholders interested in attending the briefing session should contact Keyter Rech Investor Solutions at antoinette@kris.co.za for the link. A recording of the session can be requested by contacting Keyter Rech Investor Solutions at the abovementioned email address.
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