Impala Platinum shares retreat in spite of "commendable performance" in latest update

Impala Platinum Holdings' share price rally fell back over 6% on Friday morning even though a production update showed the group is on track to deliver refined production, unit cost and capital expenditure guidance in the 2026 financial year.

The share price fell 6.14% to R342.02 on the JSE in early trading. However the price is still substantially higher than the R102.61 it traded at the same time last year. Over the year, in rand terms, the platinum price has surged 124%.

Impala's directors said there had been a "commendable performance," for the six months to December 31, 2023, with "notable gains" in the second quarter.

Group 6E platinum production increased by 1% to 1.80 million 6E ounces from 1.78 million 6E ounces for the comparative period. Production from managed operations* increased 1% to 1.41 million 6E ounces.

Impala Rustenburg's production declined by 2% to 888 000 stock-adjusted and saleable 6E ounces.South and Central shafts saleable 6E ounces fell by 4% to 661 000, with a gain in operating momentum in the second quarter.

Saleable production from the North Shafts improved by 6% to 228 000 6E ounces due to improvements at Styldrift. At Marula, increased development rates on grade and recoveries were the result of interventions to improve mining flexibility. Concentrate production fell 4% to 97 000 6E ounces.

Production in matte at Zimplats increased by 13% to 317 000 6E ounces - the comparative period was impacted by commissioning the expanded smelter complex. At Impala Canada, 6E concentrate volumes fell by 5% to 109 000 ounces, reflecting the tapering of production rates at the operation.

Group production and managed volumes were restated following the consolidation of Impala Rustenburg. The figures now include saleable and concentrate volumes from the North Shafts (formerly Impala Bafokeng), whereas previously only concentrate volumes from this operation were reported.

Third-party production increased 11.9% to 115 103 ounces. Production from joint ventures fell by 3% to 272 000 6E ounces. Two Rivers recorded a 2% decrease in 6E in concentrate production to 150 000 ounces, with grade and yield improvements offsetting the impact of reduced milled throughput.

At Mimosa, 6E in concentrate volumes declined by 5% to 123 000 ounces, with processing stability impacted by intermittent power interruptions and increased volumes of oxidised ore as mining operations approach the extremities of the orebody. Refined 6E production, which includes saleable ounces from Impala Rustenburg's North Shafts and Impala Canada, was stable at 1.78 million 6E ounces.

Processing operations saw record milling rates delivered at the Base Metal Refinery and the scheduled rebuild of Furnace 4 initiated as planned, in December 2023. Material gains in US dollar basket pricing were only partially offset by appreciation in the rand exchange rate. As a result, group sales revenue improved to R33 250 per 6E ounce sold (R23 831).

Group unit costs per 6E ounce were expected to increase by 11% to R23 200 (R20 885). Input inflation was driven by labour spend adjustments at Zimplats, increased development rates at Marula and marginally lower stock-adjusted volumes at managed operations.

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