Implats records higher PGM sales in spite of big disruptions

IMPALA Platinum (Implats) reported higher 6E platinum group metals (PGM) sales volumes during the three months ended March 2021 compared to a year ago despite grappling with Eskom load shedding and community unrest.

Implats said on Friday that 6E PGM sales volumes were up 14 percent to 862 000 ounces in the three months ended March 2021, broadly in line with contractual requirements with some additional destocking of iridium and ruthenium as demand and pricing improved for these metals. 6E PGM is platinum, palladium, rhodium, iridium, ruthenium and gold.

Implats’s destocking of iridium and ruthenium came as the strong metal price environment resulted in South Africa’s PGM sales overtaking coal for the first time in the last decade to become the single biggest contributor to mining sales at R190 billion in 2020.

Chief executive Nico Muller said on Friday that the rand PGM pricing remained elevated.

“We are pleased to be able to reiterate our key guidance metrics for the 2021 financial year, while reaffirming our commitment and ability to deliver significant value to all our stakeholders,” Muller said.

Implats said it was able to meet its 2021 guidance parameters on production, unit costs and capital expenditure.

The group said tons milled at managed operations during the March quarter increased by 4 percent to 5.59 million tons quarter, with higher volumes reported at Impala Rustenburg, Impala Canada and Marula.

The group said production for the nine months ended March 31, 2021, had benefited from the inclusion of Impala Canada for the full reporting period.

In December 2019, Implats closed its $1 billion (R14.5bn) takeover of North American Palladium, which then changed its name to Impala Platinum.

Implats said while all South African operations were knocked by Eskom load curtailment in March, Two Rivers in Limpopo was adversely affected by a series of failures and required repairs to the regional transmission network, further impacting operating capacity during the quarter.

“In addition, community unrest and protests were a notable feature in the quarter, impacting employee attendance and operational continuity,” Implats said. Two Rivers total tons milled declined by 1 percent to 798 000 tons.

“Our people were faced with additional hurdles created by intermittent power provision and elevated community unrest in South Africa – a harsh reminder of the challenging socio-economic environment, which has been compounded by the scourge of Covid-19,” Muller said.

The group said a furnace reline at its Zimplats operations, the start of scheduled maintenance at the No 5 Furnace at Impala Rustenburg and interruptions to third-party hydrogen supply at the Base Metals Refinery at the start of the quarter also impacted output.

Implats’ share price slid 2.28 percent on Friday to close at R271.53.