- S.Africa's coal-fired plants struggling to generate power
- Power cuts in world's top PGM producer dim global supply outlook
- Sibanye PGM output fell 9% in 2022
- Miner's profit halved by strike, floods
According to Reuters article published on February 28, 2023, power cuts could reduce the output of platinum group metals (PGM) in South Africa, the world's leading supplier of the minerals, by up to 15% this year, diversified miner Sibanye Stillwater (SSWJ.J) said on Tuesday.
South Africa is experiencing extended power cuts as its coal-fired generating plants frequently break down.
Anglo American Platinum (AMSJ.J), the world's biggest PGM producer, last week said the country's power problems could shave off 5% from its output this year.
That could compound supply risk when Russia, the world's second PGM producer, is also struggling to maintain output because of problems accessing spare parts, even though it has avoided sanctions on its metal sales.
Sibanye said power cuts had resulted in production losses of 22,750 PGM ounces during 2022 and that losses would increase if the crisis persists.
"We estimate that it could impact as much as 15% of total output in our operations and in the South African industry in general," Richard Stewart, Sibanye's head of southern African operations, told a results call.
Sibanye's shares fell by more than 3% on Tuesday, after the company's full-year 2022 profit almost halved after production problems, not all related to the ongoing power cuts in South Africa.
A three-month strike over wages at Sibanye's South African gold operations cut the miner's gold production by 50% last year, while a seven-week work stoppage caused by floods at its U.S. PGM operations resulted in a 26% decline in output.
Power cuts, together with safety stoppages and cable theft, caused PGM production at Sibanye's South African operations to decline 9% to 1.73 million ounces in 2022, Sibanye said.
Its headline earnings per share (HEPS) - the main profit measure in South Africa - fell 49% to 6.52 rand ($0.3537) for the year ended Dec.31 from 12.72 rand a year earlier.
The miner declared a final dividend of 1.22 rand per share, bringing the total payout to shareholders to $400 million for the year.
($1 = 18.4336 rand)
