Lonmin’s Share Price Soars on Rise in Pre-Tax Profit

on May 13, 2013

Lonmin Plc (LON:LMI), the world’s third largest primary platinum producer, reported on Monday, May 13 a rise in first-half pre-tax profit and noted that operational and financial performance had exceeded the management’s renewal plan. Lonmin’s share price soared more than six percent in morning trading in London on Monday.

**Lonmin Reports Rise in H1 EBIT**
The London-based platinum miner said in a regulatory release on Monday that underlying earnings before interest and taxes (EBIT) had risen to $93 million (£60.6 million) in the half year to March 31, up from $14 million in the prior-year period. The company also had net cash of $194 million at March 2013 as compared with a net debt of $421 million at September 2012.

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The company reported 2.4 percent year-on-year rise in platinum sales to 326,142 ounces and a fall of 1.8 percent in tonnes produced to 5.7 million.
**Company Expects Platinum Deficits up to 2018**
!m[Platinum Miner Expects Market Deficit in 2013](/uploads/story/2219/thumbs/pic1_inline.png)
In Monday’s regulatory release, Lonmin reiterated its sales guidance of 660,000 saleable platinum ounces and reduced its unit cost guidance to below eight percent per PGM ounce, compared with ten percent in the previous guidance. The company also said that it expected shortage in the platinum market in 2013 as well as continuing deficits in 2014 to 2018 due to shrinking South African supply. With platinum inventories falling, Lonmin said that it expected the platinum price to rise.

Last week, the world’s largest platinum producer, Anglo American Platinum (LON:AAL), unveiled its revised restructuring plan which would see production fall by 250,000 ounces in 2013 and decline by an extra 100,000 ounces a year in the “medium term”.
**Lonmin’s share price was 6.17 percent up at 296.00p in London as of 9:45 BST on 13 May 2013.**


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