Exarro parks platinum plans

2012-08-11 14:19

Empowerment mining group Exarro would rather close the projects in which it is already involved than be tempted to invest in the beleaguered platinum market in the short term, says group CEO Sipho Nkosi.

Exarro this week released its results for the six months to June.

Core net operating profit was up by 42%, headline earnings per share rose 11% to R11.62 a share and an interim dividend of R3.50 a share, up 17%.

The positive results caused speculation that the company would consider buying platinum mines because the poor performance of the commodity had made it a good time to acquire the assets.

Nkosi told City Press this week that as a mining company, they would always pay attention to possible investments in their area of business but that platinum was very low on their list of targets right now.

“Platinum is at its cheapest and as a mining company we cannot not look at it. But we cannot run around not closing the projects we already have,” said Nkosi.

Exarro has a R9.5-billion investment in Eskom’s new power station Medupe and spent R2.4 billion developing a new mine in Richards Bay, KwaZulu-Natal.

It put up $3.4 billion (about R29 billion) to partner with US-based paintmaking ingredient company, New Tronox.

A paint-making plant in South Africa is a distinct possibility as a result of this deal.

The company is also involved in a joint venture with India’s Tata Power and Exxaro Resources to build renewable energy plants in Eastern Cape and Western Cape.

It has invested R3 billion acquiring an iron-ore mine in the Democratic Republic of the Congo and a further R3 billion on infrastructure around the mine which includes building and upgrades.

Nkosi said: “People have been saying that empowerment has failed. We believeit works.

“We are an empowerment company and we are investing not only in the country but on the continent as well.
 
“We are not saying ours is the only model that works but we are saying we know ours works.”

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