**Lonmin Swings To Full-Year Pretax Loss After Five Month Strike Action**
LONDON (Alliance News) – Lonmin PLC (LON:LMI) Monday said it swung to a pretax loss after strike action in South Africa halted the company’s production for five months of the year.
For the year ended September 30, the company swung to a pretax loss of USD326 million, compared to a USD140 million profit in 2013. Revenue also fell to USD965 million compared to USD1.52 billion a year earlier.
“The strike impact on production saw platinum group metal sales volume for the year decreasing by 31% compared to the volume sold in the prior year which contributed USD442 million to the total decline in revenue,” said Lonmin.
“The five month AMCU led strike, which started on January 23, and was eventually resolved on June 24, was the dominant event for the year and accounted for almost all of the under-performance for the year,” it said in a statement.
During the full year, Lonmin mined 6.1 million tonnes, a 48% decrease from the previous year. The company produced 380,359 ounces of saleable platinum in concentrate, down 49% from the previous year. Lonmin produced 882,094 ounces of platinum metal groups, down 34% from 2013.
Platinum sales reached 441,684 ounces during the full year. Platinum sales contributed 64% of the company’s turnover. Palladium was the second highest contributor to revenue, with the 212,500 ounces sold constituting 17% of Lonmin’s income. Combined sales of rhodium, ruthenium and iridium contributed a further 11% and gold and base metals made up the balance.
The average price of platinum was USD1,426 per ounce in the year to September 30, compared to USD1,537 per ounce for 2013, representing a 7% reduction. Rhodium lost just USD7 on average and Palladium prices grew by 11%, it said in a statement.
Lonmin’s guidance for the 2015 financial year is to produce 750,000 ounces of saleable platinum in concentrate, with sales expected to reach 730,000 platinum ounces. Unit costs are expected to fall to ZAR10,800 per platinum group metal ounce.
By Joshua Warner; [email protected]; @JoshAlliance
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