JSE-listed Impala Platinum’s (Implats’) basic earnings for the financial year ended June 30 were negatively impacted on by R19.8-billion of impairments, including the impairment of goodwill, property, plant and equipment and the prepaid royalty at Impala Rustenburg of R16.5-billion as a result of the lower prevailing rand platinum group metal (PGM) price.

Other impairments included an impairment of property, plant and equipment at Impala Canada of R1.6-billion, reflecting the change in planned operating parameters effected during the period; A R686-million impairment of property, plant and equipment at the Mimosa joint venture (JV) owing to the combined valuation impact of lower prevailing rand PGM pricing and the deferral of the North Hill life-of-mine replacement project; and a R987-million impairment of property, plant and equipment at the Two Rivers JV owing to the combined valuation impact of lower prevailing rand PGM pricing and elevated near-term capital expenditure from the Merensky project, which is currently under construction.

Implats expects to report a basic loss of between R16.9-billion and R17.8-billion and a basic loss a share of between R18.83 and R19.84.

Further, headline earnings for the period were impacted by a one-off, non-cash broad-based black economic empowerment charge of R1.9-billion, arising on the implementation of the empowerment transaction in June.

As a result, Implats’ headline earnings for the period are expected to decrease by between 85% and 90% to between R1.9-billion and R2.8-billion, while headline earnings a share are expected to decrease by between 86% and 90% to be between R2.12 and R3.12.

Implats says it navigated several serious challenges and a constrained operating environment to deliver guided production volumes and good cost controls.

Achieved volumes benefitted from the maiden yearly consolidation of Impala Bafokeng.

Implats says that notable performances were achieved on a like-for-like basis (excluding Impala Bafokeng’s contribution) at the group’s key mining and processing operations.

It highlights that project delivery progressed to plan and, despite elevated capital expenditure (capex) and higher levels of in-process inventory, the group generated positive free cash flow in the second half of the financial year.

Gross group platinum, palladium, rhodium, iridium, ruthenium and gold (6E) production increased by 13% to 3.65-million 6E ounces from 3.25-million 6E ounces for the previous year, with a 1% decline in like-for-like production.

Production from managed operations increased by 21% to 2.92-million 6E ounces, with a like-for-like improvement of 2% from the collective production base at Impala Rustenburg, Marula, Zimplats and Impala Canada.

Implats' fatal-injury frequency rate deteriorated to 0.127 per million man-hours worked from 0.040.

The safety performance was dominated by an event at 11 Shaft in November, in which 13 employees lost their lives and a further 73 employees were injured following an accident involving a personnel conveyance.

The group reports that an additional six employees lost their lives in unrelated incidents at managed operations in the period under review, bringing the group’s reported fatalities to 19 in the period.

Investigations into the 11 Shaft incident are ongoing, while investigations into the remaining incidents were completed and remedial actions implemented, the group assures.

The lost-time injury frequency rate improved by 1% to 3.89 per million man hours worked, while the total-injury frequency rate recorded a 10% improvement.

Production from JVs increased by 1% to 547 000 6E ounces.

Concentrate receipts from third parties declined by 34% to 191 000 6E ounces, owing to the conclusion of two contracts in the third quarter.

Refined 6E production, which includes saleable ounces from Impala Bafokeng and Impala Canada, increased by 14% to 3.38-million 6E ounces and was 2% higher on a like-for-like basis.

Group processing capacity was limited by the scheduled rebuild of No 5 furnace at Impala Rustenburg.

Maintenance was initiated in December 2023 with the furnace successfully recommissioned as planned in April.

Implats ended the year with excess inventory of about 390 000 6E ounces. ‘

Performances benefitted from a notable reduction in the frequency and intensity of load curtailment in South Africa, but heightened electricity supply constraints were experienced in Zimbabwe.

As a result, Implats estimates production of about 21 000 6E ounces was foregone across Southern African-managed and JV operations during the period, while a further 12 000 6E ounces were deferred.

Sales volumes of 3.44-million 6E ounces, including saleable production from Impala Canada and Impala Bafokeng, increased by 16% and were 3% higher on a like-for-like basis.

Received US dollar sales revenue per 6E ounce fell by 34%, with sharply lower average palladium and rhodium pricing.

The achieved rand exchange rate weakened by 5% and group sales revenue decreased by 30% to R25 257 per 6E ounce sold.

Group unit costs per 6E ounce for the period are expected to increase by 5.5% to about R20 925 on a stock-adjusted basis. The benefit of cost-containment initiatives and volume gains at managed operations was partially offset by the inflationary pressures of rand depreciation on the translated dollar cost base of Zimplats and Impala Canada, and the inclusion of Impala Bafokeng unit costs.

Cash capex of R12.3-billion was incurred in the year. A further R1.7-billion of capital payments, primarily associated with Zimplats’ growth projects and incurred in the prior period was transferred from prepayments to capex in the period.

As a result, the group’s total capex in the year is expected to have increased to about R14-billion from R11.5-billion in the comparative period, reflecting the consolidation of capex from Impala Bafokeng, higher levels of growth capital at Zimplats and the impact of rand depreciation on the translation of foreign subsidiaries’ spend.

Labour restructurings were completed at Impala Canada and Zimplats in the period, while a Section 189(3) process was initiated during the fourth quarter across the South African-managed operations — Impala Rustenburg, Impala Bafokeng, Marula and the corporate office.

Natural attrition, together with re-deployment, reskilling efforts, and the uptake of voluntary separation packages, ensured that no employees were forcibly retrenched, the group assures.

It incurred R488-million in costs associated with the restructuring process in the year, with cash outflows of R109-million and R375-million in full year 2024 and full year 2025, respectively.