African Rainbow Minerals (ARM), a major South African mining and minerals company owned by Patrice Motsepe, Africa’s first Black billionaire, has suffered a huge blow as its headline earnings dropped by 43 percent to less than $160 million in the first half of the 2024 fiscal year.

The group’s interim results showed that headline earnings fell from R5.17 billion ($275.5 million) in the first half of 2023 to R2.96 billion ($157.8 million) in the same period of 2024, due to a sharp fall in platinum group metals (PGM) commodity prices.

This, according to billionaires.africa, also led to a decrease in revenue from R9.37 billion ($499.34 million) to R6.6 billion ($351.7 million).

ARM reported basic earnings of R1.216 billion ($65 million) or R6.2 ($0.33) per share, a huge contrast to the R4.388 billion ($233.9 million) or R22.39 ($1.19) per share reported in the first half of 2023.

This steep decline was mainly caused by impairments of R1.739 billion ($92.7 million) after tax, resulting from lower profitability in its PGM operations.

The impairments affected ARM Platinum, the group’s platinum division, where profitability dropped because of lower PGM commodity prices.

Likewise, ARM Ferrous, the iron ore division, faced impairments due to lower expected sales volumes and prices.

African Rainbow Minerals has a strong presence in various mining projects involving iron, coal, copper, gold, platinum, and other precious metals.

Motsepe owns a 45.9 percent stake in ARM, which makes him one of Africa’s richest people, the report added.

Despite the recent big drop in headline earnings, ARM’s retained earnings only slightly decreased from R41.08 billion ($2.19 billion) as of Dec. 31, 2022, to R40.89 billion ($2.17 billion) as of Dec. 31, 2023.

However, the company’s total assets increased from R60.4 billion ($3.22 billion) to R64.4 billion ($3.43 billion).

ID/AE

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