Research archive for AMS

It is however quite hard to be an optimist when you look at the trading statement released by Amplats this morning however. This is for the year to end December 2012, a year that was the worst for miners in terms of labour relations for as long as many can remember. Sis. I am going to copy and paste the Trading Statement: "Headline earnings per share ("HEPS") for the period is expected to decrease to a loss of between 491 cents and 628 cents from a profit of 1,365 cents reported for the year ended 31 December 2011."

There would be some irony if Chris Griffith could take over at Amplats at the bottom of the market, and leaving Kumba Iron Ore near the top of the market. Some folks might attribute a turn around to him, even if it was just the market. Of course a very good manager can make an enormous difference.

Oh dear, not another trading update like the last one. I am referring to a late announcement from Amplats, after the market had closed yesterday. Here goes the ugly: "Headline earnings per share ("HEPS") for the period is expected to decrease to between 270 cents and 280 cents from 1,236 cents reported for the six months ended 30 June 2011." Is that it? Well, the stock got completely crushed this morning at the beginning of trade, down to as low as 407 Rand a share. It has settled to be down around two and a quarter percent on the day, on a day that the markets are doing pretty well.

This morning we had a very disappointing trading update from Anglo Platinum. This industry cannot catch a break with the biggest global producer announcing a more than 20% decrease in earnings compared to the 6 month period ending June 2011. The stock is down 2.7% while the whole index is down 1.7%.

A set of results that we missed yesterday, Anglo American Platinum, reported full year numbers. Headline earnings per share, well telegraphed, fell 29 percent to 1365 cents. But, as the release says: "Headline earnings per ordinary share excluding the once-off accounting charge for the broad-based community economic empowerment transaction (R1.07 billion), the US$10 million donation to the Tongogara district community in Zimbabwe and other once-off costs increased by 8% to R20.94 from R19.35 in 2010." So, we would be closer to 21 Rand worth of earnings. Still, is that enough to justify a 548 ZAR share price? The forecasts suggest earnings will top 30 ZAR a share this year, and be perhaps as much as 50 ZAR a share in 2013. So, that is why the share price trades at these levels.

We see a trading update from the biggest miner of platinum, Anglo American Platinum Limited this morning, released at exactly 9am. Brace yourself, it is ugly looking. "HEPS for the period is expected to decrease by between 24% and 34%." Sad face. For the full year 2010, the company made 1935 cents HEPS. Expect HEPS for the full year to be in the region of 1277 to 1470 cents, 1373 is the middle of the range. Two big reasons for lower earnings, "the impact of the once off accounting charge for the broad-based community development transaction (R1.07 billion)" and something else that we have talking about for a while now: "HEPS for the period has also been adversely affected by the high number of safety stoppages resulting in lower production, as well as high industry cost inflation, particularly for labour and electricity."

Anglo Platinum results this morning, for the half year to June. Gross sales increased to 24.972 billion ZAR, and profits of 3.383 billion ZAR. EPS three percent lower at 1273 ZAR cents. HEPS at 1236 cents, higher by 20 percent. The "strong Rand", which moved from 7.54 to the US Dollar in the period last year, 6.90 to the US Dollar average in this period. Gross profit margins for the period were 19.2 percent, higher from the last reporting period (19.1 percent) and much higher than the last full year (17.5 percent). A dividend was declared, 500 cents per share, which as the announcement says is two and a half times dividend cover.

Then we had a trading update from Anglo Plats who are finalising their results for the 6 months ended 30 June 2011. Headline earnings expected to be between 1131c and 1336c per share compared to 1028c for the period ending 30 June 2010. That is an increase of 17%. They said that these increases attributable to an increase in both the platinum price and production.

As promised, a closer look at Anglo Platinum, their results presentation was released midday here, a more reasonable time to hook investors up from all around the world. After dinner in Asia, and pre lunch in our time zone. And early morning for North America, there is a lot to be said for living in this time zone. For the full release, check it out: ANGLO PLATINUM LIMITED ANNUAL RESULTS PRESENTATION. I have taken a few key graphics and published them. First, operationally, how did they do compared to 2009:

Anglo Platinum released a trading update here yesterday in the city of Gold and again guys, the market almost always gets it right. The stock was until yesterday trading on what looked like a lofty valuation, but we managed to work it all out quite quickly and said, spot on market. Apart from missing the 3.73 percent gain yesterday, you got it right "Mr. Market". I thought that a bit of simple math would prove my point, so here goes guys, the release, read it first:

Anglo Platinum out with interim results this morning. The one thing that struck me immediately of course is the massive recovery, as the company points out "headline earnings of R2 559 million, up 532% on the first half of last year, in line with significantly higher metal prices." And on Friday Ford pointed to a strong recovery in the Auto market. Not just in America, but globally, that bodes well for the platinum producers.

Staying with the platinum producers, the biggest platinum producer, Anglo Platinum had a trading statement yesterday. Here goes, it is from the release yesterday Anglo Platinum hereby advises shareholders that both basic earnings per share and headline earnings per share for the half year ended 30 June 2010 are expected to increase by at least 20% from the basic earnings per share of 1,144 cents and headline earnings per share of 169 cents for the half-year ended 30 June 2009. This is despite the increase in number of shares in issue following the rights offer. Excellent. Seems like a good outcome and just showing you how quickly the environment can turn for the platinum producers. No wonder these stocks are so wild in their price action.

Wow, it is Anglo day. All the past and present companies out with production reports and quarterly updates. Anglo first quarter production report, iron ore production up 23 percent, refined platinum up 11 percent, Metallurgical coal production increased by 32 percent.