| Fri 7 Jan 2005, 8:47 | | Angloplat's earnings up 37% in 2004, say analysts |
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Angloplat`s earnings up 37% in 2004, say analysts
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But company`s troubles aren`t over yet`
I-Net Bridge
WORLD number one platinum miner Anglo Platinum (Angloplat ) is expected to report a 37% increase in headline earnings a share for its 2004 financial year, which ended in December 2004, compared with its 2003 year, an I-Net Bridge consensus of 11 analysts shows.
Angloplat will issue its latest set of financial results on the morning of February 14.
It expects to report headline earnings a share of 1337c, up from 972,4c in 2003. Analysts` forecasts ranged from 1142c to 1541c a share. Investment bank Merrill Lynch has forecast Angloplat`s headline earnings a share at 1142c.
Investec analyst Leon Esterhuizen said: `Angloplat is likely to produce headline earnings per share of between R12 and R13. The group`s earnings are expected to have recovered from the 2003 financial year, which was a disaster.`
A higher basket metal price achieved from the metals Angloplat mines, and slightly higher production, are also expected to have increased Angloplat`s earnings.
`The current earnings expectation is substantially lower than the R15 to R20 expected at the beginning of Angloplat`s 2004 financial year. This shows that Angloplat`s troubles aren`t yet over,` Esterhuizen said.
As a result of the strong rand and poor operational performance, Angloplat in December 2003 cut its 2006 financial year production target from 3,4-million ounces to 2,9million ounces. In 2000, when Angloplat announced its expansion plans, former CEO Barry Davison put the group`s 2006 platinum production target at 3,5-million ounces. Former Sasol executive Ralph Havenstein replaced Davison as CEO on July 1 2003.
Analysts and investors also favour Angloplat less than rival Impala Platinum (Implats ). Merrill Lynch currently has Implats on a neutral rating and Angloplat on a sell rating.
The average rand per platinum ounce price during 2004 was R5449, up 5% from R5191 in 2003, according to I-Net Bridge data.
In US dollar terms, platinum averaged 845 a troy ounce in 2004, the highest average annual price since 1980 and also up 22% from the average in 2003 of $691/oz.
Merrill Lynch has forecast that platinum will average $825/oz this year, while UBS has the metal averaging $725/oz.
Angloplat previously put its 2004 refined platinum output at 2,40million ounces, up 4% from the 2,30-million ounces produced in the 2003 financial year.
The group is expected to declare a total dividend a share for its 2004 financial year of 786c, up 17% from 640c previously.
Analysts had forecast for the total 2004 dividend a share ranged from 425,5c to 1 038c .
In August 2004, Angloplat declared an interim dividend a share of 400c , up 8% from the previous interim dividend a share of 370c.
At the results presentation on February 14 this year, Angloplat is expected to provide an update on its platinum mining expansion plans.
`I`m not expecting a cutback in Angloplat`s production plans. However, the group is likely to move production from the eastern limb of the Bushveld Complex to the western limb to accommodate its expansion plans,` Esterhuizen said.
Mines established on the eastern limb of the Bushveld Complex have struggled to turn a profit, owing to the geological mix of metals and the difficulty of the ore body.
However, mines located on the western limb, which have been established for longer, have been a greater success.
