Anglo American’s PGM operations, such as Mogalakwena, are increasingly using treated effluent, or grey water, rather than drawing on freshwater supplies. Picture: Supplied
Anglo American is expecting to wrap up the demerger of its platinum producing unit, Anglo American Platinum (Amplats), by June this year and will benefit from a dividend windfall despite Amplats reporting on Monday a 40% plunge in earnings for the full year ended December 2024.
Amplats is being de-merged from Anglo American as the London and Johannesburg listed resource group restructures its portfolio to focus more on copper, premium iron ore and crop nutrients.
Anglo American has already made administrative changes, with majority shares in Amplats shifting ownership from Anglo American South Africa to Anglo American International.
Anglo American says it has “made significant progress towards its demerger” of Amplats. It will now “seek shareholder approval for the demerger” at its annual general meeting (AGM) on April 30, subject to governance and regulatory approvals.
“We are on a clear timeline towards demerging Anglo American Platinum. Anglo American intends to retain a 19.9% shareholding in Anglo American Platinum in order to further help manage flowback by reducing the absolute size of the shareholding that will be demerged,” said Duncan Wanblad, CEO of Anglo American.
As such, Anglo American will no longer have any representation on the Anglo American Platinum board post demerger. Moreover, Anglo American intends to ultimately exit its residual shareholding in Amplats over time, and subject to customary lock-up arrangements.
Analysts expect that the disposal of Amplats will not be to a single entity. Others believe that Amplats “has more than enough depth in management (technical and financial/admin) to run the company independently” of Anglo American.
“The demerger from Anglo American plc is planned to be completed in June 2025. We will be a more focused, competitive and independent business, continuing as a leader in the PGM industry,” said Amplats CEO, Craig Miller.
He added that Amplats had a “formidable established platform to work from, with an industry-leading mineral endowment combining high quality, long-life asset base, outstanding mining operations and processing assets with cost-competitive production, and global marketing” capabilities.
Ahead of the demerger, Amplats paid a final dividend of R3 per share for the full year to December 2024, sweetened by a R59 per share special payout despite a 40% plunge in headline earnings per share.
Headline earnings per share in Amplats slumped to R32.05, it reported Monday. Amplats paid a final dividend of R3 per share, totalling R800 million for the full year and will pay a special dividend of R59 per share, totalling R15.7 billion related to its demerger from Anglo American.
“In order to set its independent capital structure in the most efficient manner ahead of the demerger the company has declared an additional cash dividend,” said Amplats.
Shares in Amplats rose nearly 1% to R662.45 in afternoon trade on the JSE on Monday while Anglo American traded 0.47% stronger at R581.70 over the same session.
The demerger from Anglo American provides Amplats with the opportunity to create an efficient independent capital structure, said Miller, adding that this would be consistent with the company’s ongoing commitment to maintain a strong balance sheet.
Over the year to December 2024, total metal-in-concentrate production for Amplats reduced by 7% to 3.6 million ounces after Kroondal transitioned to a 4E tolling arrangement.
Amplats’ refined PGM production for 2024 however increased by 3% to 3.9 million ounces through the draw down of work-in-progress inventory built-up from prior years. Consequently, sales volumes for the full year increased by 4% to 4.1 million ounces.
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