Sibanye-Stillwater expecting to sink into red after strike
JSE-LISTED Sibanye-Stillwater closed 2.78 percent weaker to R19.91 a share after saying yesterday that it was expecting to sink in the red for the six months to June on the bruising strike at its South African gold operations which ended in April.
The company told shareholders it would swing to a R265 million loss in the first half of 2019, compared with an attributable profit of R77m for the six months ended June 30, 2018.
The Association of Mineworkers and Construction Union (Amcu) led the five-month strike that ended on April 17, 2019. Sibanye-Stillwater said yesterday that the strike had affected the entire six-month production period to June.
Sibanye-Stillwater’s gold operations of Driefontein, Kloof and Beatrix mines ground to a halt on November 21 when at least 15 000 Amcu members downed tools to demand higher wages despite the company signing agreements with three other unions.
Amcu is currently demanding a R17 500-a-month salary at the company’s platinum operations.
Sibanye-Stillwater said that earnings a share would plummet and it was likely that a 467 percent decrease in earnings a share would be reported.
The group said that it would record a headline loss a share of 54 cents in 2019 from headline earnings a share of 4c for 2018, and a loss per share of 11c in the period under review compared with earnings per share of 3c for the first half of 2018.
It said a R502m increase in mining tax due to increased profitability of the platinum group metals operations, the R387m restructuring costs from the South African gold operations and other strike costs of R374m had also hurt the company.
In June Sibanye said that about 3 450 employees would be affected by the restructuring at the gold operations.
It said voluntary separation, early retirement and natural attrition accounted for the bulk of the affected jobs, with forced retrenchments limited to approximately 800 employees and 550 contract workers. FELBRIDGE became the fourth company in South Africa to be awarded a licence to cultivate, import and export medicinal cannabis by the South African Health Products Regulatory Authority (Sahpra).
Felbridge said yesterday that the licence covered an existing 140000 square feet greenhouse facility in the Western Cape and was expected to produce 20tons of dried cannabis products a year at full production. Felbridge was expected to harvest its first crop in the first quarter of 2020, it said.
Cape Town-based Felbridge follows on the milestone first for Afriplex and its partner, House of Hemp, which were awarded the first licence in April.
A landmark judgment by the Constitutional Court on September 18, 2018, paved the way for the issuing of medical cannabis in South Africa. A report by Prohibition Partners forecasts that Africa could benefit by $7.1 billion (R108.5bn) per year by 2023 if cannabis cultivation is legalised.
The World Health Organisation estimates that South Africa is the third largest producer in the world of cannabis, which provides employment for some 1.2 million people made up of 900 000 cannabis farmers and 350 000 traditional healers who grow their own cannabis for medical reasons.
Leslie Zetler, the chief executive of Felbridge, said: “Being awarded our licence from Sahpra represents a major milestone for the company and reinforces our confidence in the benefits that medicinal cannabis holds as a viable natural alternative to conventional medicines.”