Assore Limited - Assore benefits from strong inter
Assore Limited - Assore benefits from strong international demand for ores
ASSORE LIMITED
Company registration number: 1950/037394/06
Share code: ASR ISIN: ZAE000017117
ASSORE BENEFITS FROM STRONG INTERNATIONAL DEMAND FOR ORES
The Rand-US Dollar exchange rate, which has been the prime determinant of mining
house Assore`s fortunes over the past few years, has played a lesser role in the
past six months and basic business factors - notably sales volumes and prices -
have driven interim profits up strongly.
Flowing largely from the group`s 45,7% investment in jointly controlled Assmang
which reported an earnings rise from R4 million to R353 million yesterday,
Assore`s interim headline earnings per share at 31 December 2004 are up from
84,6 cents to 698,1 cents a share (725%).
To the extent that the exchange rate played any part, it was adverse with the
strong Rand - or weak US Dollar at an average rate of R6.14 from the previous
year`s R6.98 - paring profits.
The impressive growth is endorsed by a 150% increase in the interim dividend to
50 cents a share.
Assore, which jointly controls Assmang with partner African Rainbow Minerals, is
also responsible for the marketing of Assmang`s products. Assore and Assmang
chairman Des Sacco comments that `the spectacular growth has primarily been
achieved through higher sales volumes and better prices - factors that we can
influence to a greater extent than we can currency exchange rates.`
China continued to dominate the demand for manganese ore, which showed a 16%
lift in sales over the interim period to 767 986 tons. Iron ore was also up,
marginally, by 2% to 2 540 595 tons while manganese alloys recorded a 7% decline
in sales but more than offset this with higher US Dollar prices.
Looking ahead to the second half of the year, Sacco expects the firm demand for
the group`s products to be sustained and sales tonnages to exceed those of the
first half. He also anticipates improved prices for both manganese ore and iron
ore, but he cautions that `manganese alloy prices could soften.`
Substantial investment in capital projects continued over the half year,
reaching R287,1 million with R110,4 million spent on completion of the
Nchwanning III shaft complex. The development of additional iron ore reserves
and the construction of the underground chrome mine at Dwarsrivier are the other
major projects currently active.
ends
FOR FURTHER INFORMATION, PLEASE CONTACT:
Chris Cory: 0117706888
Seton Thompson:: 0317028699/ 0828979365
Date: 15/02/2005 03:25:02 PM
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