Lonmin continues to cut jobs and costs

(iStock)
(iStock)

Johannesburg - Platinum producer Lonmin will continue to review its services and reduce costs, mainly through cutting jobs, as the slide in the price of its main commodity bites further.

The company said labour costs fell R194m ($11.8m) in the last three months of 2015 after it shed 5 077 jobs of its planned reduction in head count.

"Progress continues with the restructuring programme due to the new benchmarked operating model and removal of high cost production to ensure the business remains viable," Lonmin said in a statement.

It is targeting savings of R700m in 2016.

Lonmin, crippled by a record 2014 strike, rising costs and a plunging platinum price, raised $400m through a cash call in December which failed to find favour with shareholders and priced shares at about a penny each.

The miner said refined platinum production reached 171 441 ounces in the three months to the end of December, an increase of 22.6% from a year ago despite higher safety stoppages.

The price of platinum has been on the decline for roughly the past five years. It fell 26% last year and is less than half its 2011 peak.

Lonmin shares were trading up3.63% at R14.27 by 10:15 on the JSE.


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