African Rainbow Minerals (ARI) H2 2024 earnings summary

Executive summary

• Headline earnings for FY2024 fell 43% to R5.1 billion, mainly due to lower PGM and coal prices, partially offset by higher iron ore prices and a weaker rand.

• Net cash position at year-end was R7.2 billion, down from R9.8 billion, supporting continued dividends and investment.

• Total dividend for FY2024 is R15.00 per share, down from R26.00 per share in FY2023; final dividend declared at R9.00 per share.

• Major impairments were recognized at Two Rivers, Modikwa, Beeshoek, and Cato Ridge Works due to lower prices and operational challenges.

• Safety improved with LTIFR and TRIFR down 19% year-over-year; one fatality reported.

Financial highlights

• Group headline earnings dropped to R5.1 billion from R9.0 billion year-over-year.

• Cash generated from operations was R1.8 billion, down sharply from the prior year due to lower PGM prices.

• Dividends received from Assmang stable at R5 billion; ARM Coal dividends down 29% to R422 million.

• Capital expenditure reached R8.6 billion, mainly for the Merensky project and expansion at Two Rivers.

• EBITDA margin declined, with iron ore providing stability; EBITDA fell to R1,049 million from R5,831 million.

Outlook and guidance

• CapEx guidance for FY2025 is R4.7 billion, down from R5.6 billion, reflecting completion of major projects.

• Two Rivers Merensky Project placed on care and maintenance from July 2024 due to weak PGM prices; restart to be evaluated when prices recover.

• Management remains focused on cash preservation, cost-saving, and responsible capital allocation amid commodity price volatility.

• Solar PV projects progressing, with 100MW for ARM Platinum targeted by August 2025.

• Sustaining CapEx expected at R3.5 billion per annum through FY2027.