{"id":878644,"date":"2026-10-07T12:00:00","date_gmt":"2026-10-07T10:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=878644"},"modified":"2026-10-07T11:55:05","modified_gmt":"2026-10-07T09:55:05","slug":"r5-billion-mining-giant-in-south-africa-swinging-to-a-major-loss","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/878644\/r5-billion-mining-giant-in-south-africa-swinging-to-a-major-loss\/","title":{"rendered":"R5 billion South African mining giant swinging to a major loss"},"content":{"rendered":"\n

Afrimat is expecting significant losses for the last interim period, due to changes in the rand’s value and “significantly higher shipping costs.”<\/p>\n\n\n\n

The mining and materials company said the past six months had been difficult due to the challenging trading environment, which it considered the worst since 2006, when the group was listed.<\/p>\n\n\n\n

“Since listing in 2006, Afrimat has never faced trading conditions as challenging as those experienced during the six months ended 31 August 2026,” the company said.<\/p>\n\n\n\n

It said the war in Iran had hurt its export revenue due to transportation disruptions, and that changes in the rand’s value had weighed on it.<\/p>\n\n\n\n

“Export revenue was adversely impacted by a combination of a stronger Rand and significantly higher shipping costs (49.1%) due to disruptions from the Iran conflict,” Afrimat said.<\/p>\n\n\n\n

“As a result, average mine-gate revenue per ton was down by 16.4%.”<\/p>\n\n\n\n

The war between the US and Iran has driven fuel prices up in recent months, leading to higher transportation costs globally.<\/p>\n\n\n\n

The company said these export revenue difficulties particularly impacted its iron ore operations, noting, “The primary driver of the decline in profitability during the period was iron ore.”<\/p>\n\n\n\n

In its interim results, the company expects earnings per share between 0.1 cents and 5.2 cents, representing a 95% to 100% decline from its last interim period.<\/p>\n\n\n\n

The company expects to report a headline loss per share between 55 cents and 60 cents, swinging from the 2025 interim headline earnings of 101.9 cents.<\/p>\n\n\n\n

The company said the difference between ordinary and headline earnings was largely due to the disposal of non-core assets, which did not form part of its HEPS.<\/p>\n\n\n\n

These disposals and divestitures were mandated by the Competition Commission, which the company said helped it reduce its debt-to-equity ratio.<\/p>\n\n\n\n

“During the period, the Group focused on cash generation through the disposal of non-core assets (brick and block businesses), the conclusion of the Competition Commission-mandated divestitures and converting surplus iron ore stockpiles into cash,” it said.<\/p>\n\n\n\n

“This has reduced the debt-to-equity position to below 50%. The Group targets a level closer to 25% and debt reduction, therefore, remains a focus.”<\/p>\n\n\n\n

A difficult period for Afrimat<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

Despite the negative figures, Afrimat said its aggregates and fly ash operations had performed well during the interim period.<\/p>\n\n\n\n

It said the strong performance supported its previous rationale for acquiring the Lafarge quarries, in a roughly R1 billion deal in 2024.<\/p>\n\n\n\n

Afrimat attributed this segment’s success to “Ongoing efficiency drives, effective marketing, strong client retention, and sound operational performance.”<\/p>\n\n\n\n

The segment’s profit margin had improved in the recent trading period, according to the company, but was still impacted by rising fuel costs.<\/p>\n\n\n\n

“The operating profit margin improved further during this reporting period, notwithstanding fuel price increases linked to geopolitical disruptions,” Afrimat said.<\/p>\n\n\n\n

In the company’s cement operations, the last trading period was not as positive, despite significant investment.<\/p>\n\n\n\n

It said that this part of the business had continued to incur an operating loss, despite “Afrimat investing significantly in strengthening engineering and management capacity”.<\/p>\n\n\n\n

The group said it would continue to diversify its operations, including by adding the Doornfontein iron ore deposit.<\/p>\n\n\n\n

The company said this will “replace Demaneng and provide a low stripping ratio and high-quality direct-shipping ore.”<\/p>\n\n\n\n

It has also diversified through a new MECA III manganese allocation, with 240,000 tons being shipped per annum for seven years.<\/p>\n","protected":false},"excerpt":{"rendered":"

Afrimat is expecting significant per-share losses for the last trading period, with the war in Iran weighing on its operations.<\/p>\n","protected":false},"author":131,"featured_media":878677,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"posted","_sma_x_autopost_error":"","_sma_x_post_id":"2107773187140227179","_sma_facebook_post_id":"191437357620492_2229235287896870","_sma_instagram_post_id":"18170288725461248","_sma_x_attempts":1,"footnotes":""},"categories":[9872],"tags":[26240,1516,1122,8047],"class_list":["post-878644","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-afrimat","tag-competition-commission","tag-iran","tag-lafarge"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/878644","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/131"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=878644"}],"version-history":[{"count":31,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/878644\/revisions"}],"predecessor-version":[{"id":878715,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/878644\/revisions\/878715"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/878677"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=878644"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=878644"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=878644"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}