JOHANNESBURG (miningweekly.com) – Junior miner Petmin expects to report higher second half earnings as a result of improved performance at its Somkhele anthracite mine, in KwaZulu-Natal.

The company said on Monday its headline earnings per share for the six months ended June 30 would be 10.03c, which is an increase of 92% from the 5.22c a share reported in the six months ended December 31.

The Somkhele mine was delivering solid results with anthracite production having increased by 80% compared to the previous six-month period. Somkhele now had the capacity to produce 1.2-million tonnes of saleable metallurgical anthracite and 480 000 t of energy product after the mine’s third plant that was commissioned in February and March.

Further, the company’s like-for-like profit for the year ended June from continuing operations, before impairments for the year ended June, was expected to increase by 18% to R88-million, up from R75-million in 2012.

Normalised profit after tax increased by 55% from R33.9-million for the six months ended December, to R52.7-million for the six months ended June.

Earnings per share from continuing operations were expected to be a loss of about 19.42c, owing to Petmin’s decision to impair its investment in the Veremo pig iron project in Mpumalanga with R200-million.

Petmin had acquired a 25% stake in the Veremo project in 2008. The company explained that, as per agreement, Veremo was to distribute the first of three R65-million cash payments to Petmin on February 28, but that this payment had not been received.

“Considering the state of the South African and world economies, Petmin has reviewed the project valuation parameters and recorded an impairment expense of R200-million at June 30,” the company stated.

Meanwhile, Petmin also announced its intention to terminate its secondary listing on the London bourse, as part of cost reductions taking place across the group.

The company pointed out that over the past 12 months the average daily volume of Petmin shares traded on the Aim was 10 820, compared to 1.26-million shares traded on the JSE.

“While Petmin remains cognisant of the interest of all shareholders, the rationale for delisting on the Aim is informed by the low volume of trade in the company’s shares, with the UK register comprising less than 3% of the overall total shareholding.

“We have determined that the secondary listing is administratively intensive and costly, and are of the view that the volume of trade over the past few years does not sufficiently warrant the expense of maintaining a secondary listing on the Aim,” Petmin stated.