Exxaro’s Grootegeluk mine in Lephalale in Limpopo.
Exxaro Resources has declared an interim dividend of R15.93 per share as earnings grew 75% for the six months to end June.
The company, a major supplier of coal to Eskom with interests in energy and iron ore, reported a rise in earnings mainly due to the strong performance of its coal business driven, by higher sales prices offset by slightly lower sales volumes, due to Transnet’s poor railing performance.
Exxaro, like its peer coal producers, has benefitted from record high international coal prices in the first half of the year, driven by the Russian-Ukraine conflict and Indonesia’s ban on coal exports, which affected global trade flows and increased European demand for South African coal.
Exxaro on Thursday reported a 77% jump in interim net operating profit to R9.2 billion, up from R5.2 billion in the comparative period. Revenue of R22.3 billion, was up 48% from R15.1 billion. Headline earnings per share grew 75% to R34.26 per share, up from R19.61 per share in the second half of last year. A net cash of position of R5.67 billion compares favourably to a net cash position of R764 million at the end of last year.
Despite inflationary pressures, and thanks to continuous improvements and operational efficiency, the group managed to achieve its cost performance guidance of an increase of below mining inflation.
Presenting her first set of results as Exxaro CEO, Nombasa Tsengwa said the results underscore the resilience of the business through continued delivery against its strategic priorities, as well as its people and management’s ability to respond to logistics challenges, whilst absorbing increasing inflationary pressures through ongoing disciplined cost management.
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