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Key Points
- African Rainbow Minerals' H1 2025 headline earnings dropped 49% to R1.52 billion ($83.43 million), hit by weak iron ore and PGM prices.
- ARM Platinum posted a R689 million ($37.82 million) loss, more than doubling last year’s loss, forcing scaled-back expansion plans at Bokoni.
- ARM slashed its interim dividend by 25% to R4.5 per share, lowering payouts to R1.01 billion ($55.49 million) amid market uncertainty.
African Rainbow Minerals (ARM), the diversified mining group controlled by South African billionaire Patrice Motsepe, has reported a sharp drop in profits for the first half of its 2025 fiscal year, highlighting the tough conditions facing the global mining sector.
The company’s headline earnings fell 49 percent to R1.52 billion ($83.43 million), down from R2.96 billion ($162.2 million) a year earlier. The steep decline was driven by weaker iron ore and platinum group metal (PGM) prices, sluggish demand from ArcelorMittal South Africa, and rising production costs.
ARM Platinum loss widens on PGM slump
ARM Platinum, which includes the Bokoni, Two Rivers, and Modikwa mines, took the hardest hit. The division posted a headline loss of R689 million ($37.82 million), more than doubling the R282 million ($15.48 million) loss recorded in the same period last year.
Higher mechanized development costs at Bokoni, combined with the continued slump in PGM prices, further eroded profitability, forcing ARM to scale back expansion plans at the operation.
ARM cuts dividend to conserve cash
In response to these financial pressures, ARM has taken a cautious approach to capital management, cutting its interim dividend by 25 percent to R4.5 ($0.247) per share. This reduction will lower the total payout to R1.01 billion ($55.49 million), as the company prioritizes cash preservation in an uncertain market.
Despite maintaining a net cash position of R6.07 billion ($344.53 million) as of Dec. 31, 2024, ARM recorded a net cash outflow of R1.1 billion ($60.38 million) during the period, a sharp contrast to the R449 million ($24.64 million) inflow a year earlier.
ARM eyes recovery in commodity prices
ARM, which operates across iron ore, manganese, PGMs, coal, and base metals, remains a key part of Motsepe’s business empire. As Africa’s first Black billionaire, he owns 45.9 percent of the company and has been strategically expanding his interests beyond mining to navigate industry challenges.
The company’s ability to withstand market volatility will depend on a recovery in commodity prices and strict cost control. With ongoing investments in renewable energy and efficiency improvements, ARM is working to strengthen its position in South Africa’s mining sector and build resilience despite near-term pressures.
