All this without having to resort to strike action. It was of course helpful that the National Union of Mineworkers ( NUM) is RBPlat’s main union rather than the more radical Association of Mineworkers and Construction Union (Amcu).
Seten Naidoo, an analyst for Standard Bank Group Securities, said in a note that RBPlat’s stable operating performance was “...most notably due to its enviable labour relations”. So strong are its relations that the company had sufficient labour personnel during the normally disruptive public holidays in April, he said.
A key element to RBPlat’s success so far is its focus. It only has one operating asset and a mountain of capital-intensive project work to trawl through. Taking risks on its labour relations is betting the farm; in other words, without stable cash f low from BRPM, RBPlat will be unable to finance its future.
RBPlat is due to commission its R11.3bn Styldrift project in a year’s time, of which only R3.14bn has been financed while an extension of BRPM, which replaces exhausted reserves rather than expands the mine, is due to sap another R700m over the next three years.
Prinsloo is relaxed about the pressure on the balance sheet; so much so that the board elected to close off a R1bn revolving credit facility which saves it some R600 000 per month in commitment fees.
“Also included in the R11bn on Styldrift is some R2.5bn in escalation and contingency. We haven’t used any contingencies to date so we don’t anticipate the capex will be that much,” he said. The company will look for up to R3bn in terms of debt in the first half of next year at the earliest, he said. It raised R1.5bn in a rights issue earlier this year while it was in the teeth of the platinum strike.
The realisation among mining companies such as RBPlat is that a clear line joining sustainable labour relations and cash f low is discernible, whereas in the past wage negotiations were an annual to bi-annual event to be tolerated.