Northam H1’25 HEPS down 49.7%

Northam Platinum, a major player in the platinum group metals (PGM) industry, has experienced challenging market conditions in the first half of 2025. The CEO, Paul Dunne, expects the platinum market to improve in the coming months as production declines, leading to a growing supply deficit. The company's half-year profit took a hit due to low metal prices, with the white metal currently trading at around $945 per ounce, nearly 20 percent below its post-Covid-19 high. Dunne highlighted that the pricing environment for PGM miners has been tough for the past two years, with prices hovering around R32,000 per ounce on a 4E basis, impacting miners, refiners, and recyclers. Despite these challenges, Dunne remains optimistic about a potential rebound in the market. Over the past few years, the PGM industry has faced unprecedented pressure, affecting not only South African miners but also refiners and recyclers globally. Dunne emphasized the unsustainable nature of the current market conditions, suggesting that a rebound is inevitable. He believes that the longer the down cycle persists, the more aggressive the upside rebound will be. The company's operations at Boysendal, Zonderende, and Ierland have seen mixed performances. Boysendal has reached its full capacity and is providing satisfactory returns, while Zonderende had a break-even year and faced safety challenges. Ierland, a young mine, is in the ramp-up phase but has been impacted by safety incidents. Dunne acknowledged the high demand for skilled labor in the industry, particularly for mechanized skills, leading to increased competition for talent. Northam's approach to balancing cost and investments at their Eland mine reflects a long-term view, with full production expected in the late 2020s. Despite market disruptions from issues like ESCOM load curtailments and weather-related challenges, Northam remains focused on sustainable operations and contributing to renewable energy initiatives. Looking ahead to 2025, Dunne foresees a significant deficit in platinum supply versus demand, potentially driving price reactions as above-ground stocks are depleted. The company remains committed to long-term sustainability goals and is confident in meeting its operational guidance for the year. Overall, Dunne's outlook for the future of the platinum industry is cautious yet optimistic, with a strong focus on navigating current challenges and positioning Northam Platinum for success in a changing market landscape.