Exxaro’s equity-accounted investments to offset lower interim earnings
Diversified miner Exxaro Resources expects its headline earnings per share (HEPS) for the six months ended June 30 to be between 35% and 47% higher year-on-year.
HEPS will be between R16.50 and R17.90, compared with the HEPS of R12 reported for the six months ended June 30, 2018.
The company expects its attributable earnings a share for the period to be between 97% and 109% higher, at between R24.90 and R26, compared with the earnings a share of R12 reported for the prior corresponding period.
Exxaro, led by CEO Mxolisi Mgojo, attributes the higher earnings to an increased contribution from the company’s equity-accounted investments, which more than offset lower earnings before interest, taxes, depreciation and amortisation (Ebitda) from the company’s managed operations.
Ebitda for the reporting period is expected to be between 10% and 22% lower year-on-year, at between R2.9-billion and R3.3-billion, compared with the R3.7-billion reported for the prior corresponding period.
Exxaro expects to post a 13% to 25% year-on-year increase in core HEPS, at between R11.30 and R12.50, compared with the core HEPS of R10 reported for the first six months of the prior year.
Core Ebitda for the period will be between 24% and 36% lower year-on-year, at between R2.5-billion and R2.9-billion, compared with the R3.9-billion achieved in the prior corresponding period.
Exxaro says earnings from its coal business were adversely affected by lower domestic sales volumes, a lower average price per tonne achieved on exports and a higher provision for rehabilitation and higher distribution costs.
However, these aspects were offset by higher export volumes and a favourable rand:dollar exchange rate.
The company, which produces coal and ferrosilicon and owns stakes in iron-ore and zinc mining operations, will release its financial results on August 22.
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