| Tue 17 Feb 2004, 10:38 | | Angloplat bosses to get 5% rise |
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Angloplat bosses to get 5% rise
February 17, 2004
By Sherilee Bridge
Johannesburg - Directors of Anglo Platinum (Angloplat) will get pay increases of only 5 percent this year as the company makes costs its priority.
Tom Wixley, the deputy chairman of Angloplat and chairman of the company's remuneration committee, said yesterday that "everyone of them [the directors] was limited to 5 percent" and this rule would apply across the management.
Angloplat directors, whose base salaries increased by an average of 26 percent last year, have said the above-inflation wage increase of 8.5 percent awarded to miners last year was a key contributor to the company's 20 percent rise in costs to R12.1 billion.
Ralph Havenstein, the chief executive of Angloplat, said that cost increases were "substantially more than the consumer price index and that is not acceptable to us".
Angloplat blamed this on cost increases greater than inflation in respect of labour, health and safety and steel.
Havenstein said the company would focus on efficiency improvement and cost reduction as well as sustainable cost containment.
But there might be some raised eyebrows at the pay increases that the director's received for 2003.
Of those members who were on Angloplat's board in 2002, alternate director Chris Sheppard received R1.56 million last year - a remarkable 48 percent increase.
Roeland van Kerckhoven, the executive director of finance, received a 38 percent increase to take home R2.07 million in basic pay. Chief operating officer Dorian Emmett took home 32 percent more with R2.4 million.
Angloplat's executive director commercial, Sandy Wood, got a 19 percent increase, earning R1.6 million.
Only one director, Peter Kinver, another alternate, received less than he did in 2002.
Wixley said the 2003 salary hikes were decided at the beginning of 2003,before the wage negotiations in July and ahead of the rand's rapid rise against the dollar.
Angloplat said in its annual report that director's salaries were determined by benchmarking them against companies of similar size, market sector, business complexity and international scope.
Gwede Mantashe, the general secretary of the National Union of Mineworkers, said the union expected mining companies to complain about the wage increases.
South Africa's platinum industry negotiates wage agreements separately to their gold-producing peers, which settled at a 9.5 percent increase.
"Directors represent capital while workers become a mere tool of production. That's why they [mining companies] complain about wage increases affecting operating profits.
"We don't look at inflation when negotiating wage increases, what we are trying to do is close the apartheid wage gap," Mantashe said.
South Africa's precious metals producers have been forced to review their operations after a stronger rand threatened to make it too expensive to mine profitably.
The rand appreciated by an average 41 percent against the US dollar last year, leading to a revision of capital spending across the mining industry.
Angloplat, which mines two out of every five ounces of platinum produced globally, said in November it had cut its R21.3 billion capital spending plans by 28 percent. This meant that its target of producing 3.5 million ounces by 2006 was cut by 15 percent to 2.9 million ounces.
Angloplat's shares shed 55c to close at R161 in Johannesburg yesterday.
