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ASSORE LIMITED - Results for the half-year ended 31 December 2018

Release Date: 26/02/2019 07:30
Code(s): ASR     PDF:  
 
Wrap Text
Results for the half-year ended 31 December 2018

ASSORE LIMITED
Registration number: 1950/037394/06 
Share code: ASR 
ISIN: ZAE000146932 
(Assore or group or company)


RESULTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2018

- Headline earnings 20% higher

- Interim dividend of R10 per share

- Iron ore and manganese ore prices remain firm

- Continuous commitment to overall safety performance

CEO Charles Walters says:
"We are pleased to report a healthy increase in earnings for the first half of our financial 
year. During the first 6 months, we experienced an improved price basket and a weaker exchange 
rate which were countered by some difficulties with inland logistics on certain product lines. 
Following the 60% increase in the interim dividend last year, we have maintained the interim 
dividend at R10 per share whilst continuing to build the Group’s reserves to fund our future 
growth ambitions."
 

Commentary

Safety
Assore operations
Dwarsrivier Chrome Mine Proprietary Limited (Dwarsrivier) achieved an improvement in its lost-time injury
frequency rate (LTIFR) to 0,18 for the six months to 31 December 2018 (the current period, or H1 FY19) from 
0,23 for the six months to 31 December 2017 (the previous period, or H1 FY18). However, incidents at Assore’s
other operations, resulted in an overall increase in the LTIFR from 0,21 to 0,29 over the same period.

Assmang operations
The combined LTIFR of the Assmang Proprietary Limited (Assmang) operations, which is jointly controlled by
Assore and African Rainbow Minerals Limited (ARM), has deteriorated slightly to a level of 0,13 for the 
current period, compared to 0,12 for the previous period.

The group remains committed to the pursuit of continued, sustainable improvement in our overall safety
performance.

Group financial performance
Headline earnings for H1 FY19 increased by 20% to R2,92 billion, compared to R2,43 billion for the 
H1 FY18. Assmang, in which Assore has a 50% interest, recorded headline earnings of R4,29 billion 
(H1 FY18: R3,47 billion), an increase of 23%, on a 100% basis. This contributed R2,14 billion towards the 
group's headline earnings. In accordance with International Financial Reporting Standards (IFRS), Assmang is 
classified as a joint venture and accordingly, its financial results are equity accounted. The rest of the 
group's operations reported headline earnings that were 15% higher than the previous period, at R0,77 billion, 
of which Dwarsrivier contributed R327 million (H1 FY18: R440 million), with commissions and interest earned 
making up most of the balance. Attributable earnings amounted to R2,92 billion, 19% higher than H1 FY18.

The average SA rand/US dollar exchange rate for the current period was R14,06, 5% weaker than the level that
prevailed during H1 FY18. The index price for iron ore (62% iron content, fines grade, delivered in China
(the index price)) was stable, while the lump premium for the current period increased to US dollar 20,49 
from US dollar 15,03 in H1 FY18. Manganese ore price indices were higher for both quoted grades (44% and 
37% manganese content) compared to H1 FY18. Sales volumes of iron ore and chrome ore were lower than in 
the previous corresponding period due to unforeseen inland logistical challenges while sales volumes of 
manganese ore and alloys were higher. 

Production and sales volumes achieved by the group were as follows:
                                                            Six months to        Six months to                %     
                                                              31 December          31 December      (decrease)/    
Metric tons '000                                                     2018                 2017         increase    
Production volumes (100%)                                                                                          
Iron ore                                                            8 742                9 143               (4)   
Manganese ore                                                       1 737                1 865               (7)   
Manganese alloys                                                      194                  190                2    
Chrome ore                                                            765                  717                7    
Sales volumes (100%)                                                                                               
Iron ore                                                            8 752                9 130               (4)   
Manganese ore*                                                      1 605                1 556                3    
Manganese alloys                                                      164                  162                1    
Chrome ore                                                            757                  794               (5)   
* Excluding intragroup sales

Strong cash generation resulted in group net cash increasing by 16% to R7,65 billion at December 2018
(December 2017: R6,6 billion). The board has declared an interim dividend of 1 000 cents 
(H1 FY18: 1 000 cents) per share, which will be paid to shareholders on or about 18 March 2019.

Market conditions
The markets into which the group sells its products were generally stronger in comparison to the 2017
calendar year. World crude steel demand is estimated to have grown by 3,9% in the 2018 calendar year (CY18),
resulting in favourable iron ore and manganese ore prices for the current period. The world stainless-steel
production is estimated to have grown by 6,1% in CY18. However, the demand for stainless steel eased towards 
the end of CY18 resulting in a decrease in the average index price for chrome ore compared to the previous period.

Assmang (iron ore and manganese)
Attributable earnings increased by 23% over the previous period to R4,28 billion (100% basis, H1 FY18: 
R3,47 billion). Iron ore delivered R2,43 billion (H1 FY18: R1,75 billion) while manganese ore and alloys
contributed R1,85 billion (H1 FY18: R1,74 billion). This was driven mostly by increased turnover which 
was 17% up on the previous period to R16,29 billion on the back of the weaker average SA rand/US dollar 
exchange rate, an improved price basket and an increase in the volume of manganese ore sold.

Capital expenditure in Assmang amounted to R1,98 billion for the period (H1 FY18: R1,17 billion).
Approximately half of this amount was spent in Assmang's Iron Ore division, including R443 million spent on 
waste stripping and R404 million on replacement capital. A further R225 million was spent in the Manganese division 
on the Black Rock Expansion Project (BREP) and R167 million was spent at Gloria. At 31 December 2018, 92% of the 
capital approved (R6,7 billion) for the BREP had been committed. The capital expenditure in the Manganese division, 
on the BREP and at Gloria, will provide Assmang with the capacity to produce up to 5,0 million tons per annum of 
manganese (subject to market conditions), while simultaneously optimising the Black Rock resource and providing 
grade flexibility.

Iron ore 
The average index price for iron ore for the current period remained stable, at US dollar 69 per ton
compared to the previous period. However, the lump premium increased by 36% to an average of US dollar 20 per 
ton, compared to the previous period. This was primarily due to Chinese steel mills utilising increased volumes 
of higher grade ore amid ongoing environmental restrictions. In addition, there was an increase in the premium
achieved for spot sales during the current period. 

Assmang's iron ore operations achieved total production of 8,74 million tons and total sales volumes were
8,75 million tons (H1 FY18: 9,14 million tons), 4% lower due to logistical challenges experienced on the export
rail line to Saldanha. 

Manganese ore and alloys
During the current period, demand and prices for manganese ore remained elevated, driven by China's
increased reliance on imported ore. The world market for manganese ore remained undersupplied during the period.
Robust levels of Chinese steel production, which were reported to have increased by 6,6% year-on-year in CY18,
resulted in higher alloy production, and this continued to support elevated price indices for the period for 
both higher grade (44% manganese content) and medium grade (37% manganese content) ores.

On the contrary, the world manganese alloy market experienced a period of oversupply which has resulted in
pressure on prices. This, together with the sustained elevated prices of manganese ore (as a key input cost to
alloy production), has led to some production cut backs by the manganese alloy industry.

Assmang's total sales volumes of manganese ore increased by 3% from the previous period to 1,6 million tons.
However, export volumes from Saldanha were negatively impacted by the logistical challenges experienced on
the export rail line, which necessitated the use of the road network. 

Dwarsrivier (chrome ore)
Increased beneficiation plant utilisation gave rise to a 7% increase in production volumes at Dwarsrivier to
765 000 tons, compared to 717 000 tons produced in the previous period. The Chinese markets for chrome ore
(and ferrochrome) were weaker compared to the prior period, resulting in the average US dollar price decreasing
by 10% to USD186 per ton (44% chrome content material,delivered China). 

Sales volumes decreased by 5% to 757 000 tons (H1 FY18: 794 000 tons) due to inland logistical challenges
resulting mainly from community unrest in the vicinity of the mine, as well as congestion experienced in the
port of Maputo during the latter quarter of the year. Dwarsrivier thus recorded a reduction in turnover of 
8% and a reduction in earnings of 26%. Capital expenditure amounted to R214 million (H1 FY18: R121 million) 
of which R92,6 million was replacement and the balance being on improving efficiencies and compliance. 

Marketing and shipping
Consolidated marketing commissions earned by the group increased over H1 FY18 in line with Assmang's
turnover. Interest earned on the group's cash resources amounted to R308 million (H1 FY18: R219 million).

Other
The group increased its interest in IronRidge Resources Limited (IronRidge), an Australian minerals
exploration company listed on London's Alternative Investment Market (AIM) from 28,9% to 31,27% in November 2018,
following a rights issue to the value of R56,6 million. IronRidge has a portfolio of gold, lithium, bauxite and
iron ore prospects in Africa and Australia. During the current period, the activities of IronRidge were focused
mainly on lithium and gold exploration prospecting in Ghana, Chad and Ivory Coast.

Outlook
World economic growth remained strong for CY18. However, this growth momentum has started to wane with
growth in CY19 forecast to be marginally lower. The expected decline in growth is reflected in the slowdown
observed in some of the major advanced economies towards the end of CY18 as a result of ongoing trade actions 
and the uncertain geopolitical environment. Chinese stimulus measures are being put in place to cushion the 
slowdown in that economy.

Chinese environmental policies are expected to continue to impact high grade iron ore and manganese ore
markets positively thereby supporting the demand for the group's high quality products. The demand for lump iron
ore and pellets is expected to remain firm, which should be supportive for premiums on these products. However,
the recent decline in steel prices and reduced steel mill profitability in China is anticipated to result in
a substitution in favour of ore with lower iron content. This is likely to result in a narrowing of price
differentials between the various grades of the group's products. 

The growing oversupply in the ferrochrome market and the subsequent pressure on chrome ore prices is set to
constrain any major upward chrome ore price movements.

The group remains confident that its portfolio of mines and marketing operations are well positioned for the
future.

The outlook statement has not been reviewed and reported on by the group's external auditors.

Accounting policies and basis of preparation
The directors of Assore take full responsibility for the preparation of this announcement. The financial
results for the period under review have been prepared under the supervision of Mr RA Davies, CA(SA) and in
accordance with IAS 34 Interim Financial Reporting and comply with IFRS, the SAICA Financial Reporting Guides 
as issued by the Accounting Practices Committee, the Financial Pronouncements as issued by Financial Reporting
Standards Council, the Listings Requirements of the JSE Limited (JSE) and the Companies Act, No 71 of 2008 
(as amended). The accounting policies applied are consistent with those adopted in the financial year ended 
30 June 2018 except for the new accounting standards, as described on the following page, that became effective 
from 1 July 2018.

Ernst & Young Inc., the group's independent external auditor, has reviewed the condensed consolidated
half-year results included in this announcement and their modified report on the review is available for 
inspection at the registered office of the company. The modified opinion in the report is only in respect
of comparability to unreviewed results in the previous period. The review was conducted in terms of 
ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity.

The auditor's report does not necessarily report on all of the information contained in this announcement.
Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor's
engagement they should obtain a copy of the auditor's report together with the accompanying financial
information from the company's registered office.

New accounting standards
The following accounting standards, as published by the International Accounting Standards Board (IASB) have
become effective for the group from 1 July 2018:

IFRS 15 Revenue from contracts with customers (IFRS 15) 
IFRS 15 was issued in May 2014, and amended in April 2016, and will supersede all current revenue
recognition requirements under IFRS. IFRS 15 establishes a five-step model to account for revenue arising 
from contracts with customers. The core principle of IFRS 15 is that an entity shall recognise revenue at an 
amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring 
goods or services to a customer. 

The group's revenue is primarily derived from the sale of commodity products. The timing of the revenue
recognition is dependent on the sales contract terms as documented in the International Commercial terms
(incoterms). In terms of IFRS 15, there was no change in the revenue recognised for free on board (FOB) shipments. 
The shipping service for all export sales shipped using the cost, insurance and freight (CIF) and cost and freight
(CFR) incoterms, represents a separate performance obligation, ie the sale and shipment of goods represent
two performance obligations. The primary performance obligation is the supply of the commodity, in which
instance the revenue will be recognised once the buyer takes control of the goods. This will not result in a 
change in revenue recognition from IAS 18 Revenue to IFRS 15. The other performance obligation is the delivery 
of the shipping service where the revenue earned will be recognised over the period that the service is rendered. 
In December 2018 and December 2017 most of the sales were FOB and therefore the deferral of revenue component 
was negligible. The application of IFRS 15 did not result in changes to the revenue recognised arising from
commission income.

The group has elected to adopt a full retrospective approach to the adoption of the standard. The impact on
the reported gross profit for the H1 FY18 is negligible and did not require adjustment. The group will be
making additional disclosure in the notes to the financial statements, setting out the respective components 
of revenue as reported at 30 June 2019.

IFRS 9 Financial Instruments (IFRS 9)
IFRS 9 has replaced IAS 39 Financial Instruments: Recognition and Measurement and applies to the
classification and measurement of financial assets and financial liabilities, their impairment and hedge 
accounting. The group adopted the new standard on 1 July 2018 which is the group's effective date of adoption 
and no comparative information was restated. The classification and measurement of financial assets and 
liabilities adopted by the group will remain mostly unchanged, except for available-for-sale investments, 
which will be classified as financial assets measured at fair value through other comprehensive income. 
The impact of this is that all fair value gains and losses will not be recognised in the income statement 
but will remain in other comprehensive income. This represents a change from the previous treatment of 
gains and losses recorded on remeasurement of these investments, which required impairment losses as well 
as gains and losses on disposal to be recognised in the income statement. 

The impact of the expected credit losses on financial assets classified at amortised cost in the group was
determined as being negligible.

Subsequent event
On 6 February 2019, all conditions precedent for the conclusion of the sale of Assmang's smelter operations
at Machadodorp had been met, and the assets (which had been previously fully impaired) are due to be disposed
of, by 28 February 2019.

Declaration of interim dividend
Shareholders are advised that on 25 February 2019, the board approved interim dividend number 124 (the
dividend), of 1 000 cents per share (gross) for the half-year ended 31 December 2018.

In terms of paragraph 11.17 of the Listings Requirements of JSE Limited, shareholders are advised of the
following with regard to the declaration:
1. the dividend has been declared from retained earnings
2. the local dividend tax (dividend tax) rate of 20% will apply
3. the net local dividend amount is 800 cents per share for shareholders liable to pay the dividend tax
4. the issued ordinary share capital of Assore is 139 607 000 shares, of which 36 460 825 (H1/18: 36 455 970) 
   shares are accounted for as treasury shares in terms of IFRS and are therefore excluded from earnings per
   share calculations; and
5. Assore's income tax reference number is 9045/018/84/4.

The salient dates are as follows:
- Last day for trading to qualify and participate in the interim dividend;            Tuesday, 12 March 2019
- Trading "ex dividend" commences;                                                  Wednesday, 13 March 2019
- Record date;                                                                         Friday, 15 March 2019
- Dividend payment date; and                                                           Monday, 18 March 2019
- Dates (inclusive) between which share certificates may not be                  Wednesday, 13 March 2019 to
  dematerialised or rematerialised.                                                    Friday, 15 March 2019

On behalf of the board

Desmond Sacco                          Charles Walters
Chairman                               Chief Executive Officer

Johannesburg

26 February 2019


CONDENSED CONSOLIDATED INCOME STATEMENT                     
                                                                  Half-year         Half-year              Year    
                                                                      ended             ended             ended    
                                                                31 December       31 December           30 June    
                                                                       2018              2017              2018    
R'000                                                              Reviewed         Unaudited           Audited    
Revenue                                                           3 947 562         3 841 588         7 804 737    
Turnover                                                          3 073 911         3 138 720         6 305 587    
Cost of sales                                                    (2 509 512)       (2 416 102)       (4 800 780)    
Gross profit                                                        564 399           722 618         1 504 807    
Commissions on sales and technical fees                             560 423           458 174           979 005    
Foreign exchange gains                                               84 109                 -                 -    
Other income                                                        340 430           291 731           648 564    
Impairment of financial and non-financial assets                          -           (21 564)          (31 083)    
Foreign exchange losses                                                   -           (81 998)           (6 896)    
Other expenses                                                     (381 968)         (336 003)         (762 531)    
Finance costs                                                       (19 384)           (8 912)          (19 394)    
Profit before taxation and joint venture                          1 148 009         1 024 046         2 312 472    
Taxation                                                           (335 280)         (262 764)         (645 546)    
Profit after taxation, before joint venture                         812 729           761 282         1 666 926    
Share of profit from joint venture, after taxation                2 133 162         1 728 868         3 524 287    
Share of loss from associate, after taxation                        (13 889)           (8 404)          (16 211)    
Profit for the period                                             2 932 002         2 481 746         5 175 002    
Attributable to:                                                                                                   
Shareholders of the holding company                               2 915 592         2 454 375         5 119 329    
Non-controlling shareholders                                         16 410            27 371            55 673    
As above                                                          2 932 002         2 481 746         5 175 002    
Earnings as above                                                 2 915 592         2 454 375         5 119 329    
Impairment of non-financial assets in                       
joint venture and subsidiaries                                       19 628            21 564            48 929    
Gain on disposal of subsidiary                                       (2 669)                -                 -    
Profit on disposal of property, plant and equipment         
in joint venture and subsidiaries                                   (12 952)           (5 619)           (4 348)    
Profit on sale of available-for-sale investments                          -           (42 565)          (42 432)    
Taxation effect of above items                                       (2 595)            1 258           (12 726)    
Headline earnings                                                 2 917 004         2 429 013         5 108 752    
Earnings per share (basic and diluted - cents)                        2 827             2 379             4 963    
Headline earnings per share (basic and diluted - cents)               2 828             2 355             4 953    
Dividends per share declared in respect of the              
profit for the period (cents)                                         1 000             1 000             2 200    
- Interim                                                             1 000             1 000             1 000    
- Final                                                                                                   1 200    
Weighted average number of ordinary shares (million)                                                               
Ordinary shares in issue                                             139,61            139,61            139,61    
Weighted impact of treasury shares held in trust                     (36,46)           (36,45)           (36,46)    
                                                                     103,15            103,16            103,15    

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                                                                  Half-year         Half-year              Year          
                                                                      ended             ended             ended          
                                                                31 December       31 December           30 June          
                                                                       2018              2017              2018          
R'000                                                              Reviewed         Unaudited           Audited          
                                                                                                                         
Profit for the period (as above)                                  2 932 002         2 481 746         5 175 002          
Items that may be reclassified into the income                                                     
statement dependent on the outcome of a future event                 38 204            22 086           162 862          
Gains on revaluation to market value of                                                            
available-for-sale investments after taxation                             -            30 186            32 933          
Gain on revaluation to market value of                                                             
available-for-sale investments                                            -            38 900            77 024          
Deferred capital gains tax thereon                                        -            (8 714)          (44 091)          
Exchange differences on translation of foreign operations            38 204            (8 100)          129 929          
Items that may not be reclassified into the                                                        
income statement dependent on the outcome of a future event           1 625                 -            17 206          
Gain on revaluation to market value of financial                                                   
assets measured at fair value through other                                                        
comprehensive income after taxation                                   1 625                 -                 -          
Gain on revaluation to market value of financial                                                   
assets measured at fair value through other                                                        
comprehensive income                                                  2 096                 -                 -          
Deferred capital gains tax thereon                                     (471)                -                 -          
Actuarial gain on pension fund, after taxation                            -                 -            17 206          
Total comprehensive income for the period, net of tax             2 971 831         2 503 832         5 355 070          
Comprehensive income attributable to                                                               
non-controlling shareholders                                        (19 859)          (40 166)          (57 709)          
Attributable to shareholders of the holding company               2 951 972         2 463 666         5 297 361          


CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION        
                                                                         At                At                At    
                                                                31 December       31 December           30 June    
                                                                       2018              2017              2018    
R'000                                                              Reviewed         Unaudited           Audited    
ASSETS                                                                                                             
Non-current assets                                                                                                 
Property, plant and equipment and intangible assets               1 943 713         1 662 604         1 793 865    
Investments                                                                                                        
- joint venture                                                  16 410 049        16 278 970        15 984 321    
- financial assets measured at fair value through             
  other comprehensive income (2017: available-for-sale        
  investments)                                                      264 096           223 876           262 003    
- associate                                                         199 371           172 297           154 896    
- other                                                               7 772            21 559             7 568    
Long-term loans                                                       9 300                 -             6 000    
Pension fund surplus                                                129 245            93 144           129 245    
Total non-current assets                                         18 963 546        18 452 450        18 337 898    
Current assets                                                                                                     
Inventories                                                       1 830 318         1 049 715         1 361 954    
Trade and other receivables                                       1 155 033           625 364         1 222 327    
Cash resources                                                    8 754 832         7 115 272         8 449 797    
Assets held-for-sale as part of identified disposal groups              213                 -             1 351    
Total current assets                                             11 740 396         8 790 351        11 035 429    
TOTAL ASSETS                                                     30 703 942        27 242 801        29 373 327    
EQUITY AND LIABILITIES                                                                                             
Share capital and reserves                                                                                         
Ordinary shareholders' interest                                  27 844 362        24 524 354        26 091 352    
Non-controlling shareholders' deficit                               (62 184)           (1 877)          (40 990)    
Total equity                                                     27 782 178        24 522 477        26 050 362    
Non-current liabilities                                                                                            
Net deferred taxation liabilities                                   411 095           264 871           345 440    
Non-interest-bearing liabilities                                    197 541           135 925           184 152    
Total non-current liabilities                                       608 636           400 796           529 592    
Current liabilities                                                                                                
Interest-bearing                                                  1 108 262           513 874           584 472    
Non-interest-bearing                                              1 204 328         1 805 654         2 191 727    
Liabilities associated with assets held-for-sale                        538                 -            17 174    
Total current liabilities                                         2 313 128         2 319 528         2 793 373    
TOTAL EQUITY AND LIABILITIES                                     30 703 942        27 242 801        29 373 327    


FAIR VALUES OF FINANCIAL INSTRUMENTS

The group uses the following hierarchy for determining and disclosing the fair value inputs of 
financial instruments:
Level 1 - quoted prices in an active market that are unadjusted for identical assets or liabilities;
Level 2 - valuation techniques using inputs, which are directly or indirectly observable; and
Level 3 - valuations based on data that is not observable (not applicable to the Group).

The values of all other financial instruments recognised, but not subsequently measured at fair value, 
approximate fair value.
                                                                  Half-year         Half-year              Year    
                                                                      ended             ended             ended    
                                                                31 December       31 December           30 June    
                                                                       2018              2017              2018    
                                                                   Reviewed         Unaudited           Audited    
R'000                                                               Level 1           Level 1           Level 1    
Assets measured at fair value                                                                                      
Financial assets measured at fair value through                                                     
other comprehensive income                                                                          
(2017: available-for-sale investments)                              264 096           223 876           262 003    
Other investments                                                     7 772            21 559             7 568    
                                                                    271 868           245 435           269 571    


CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
                                                                  Half-year         Half-year              Year    
                                                                      ended             ended             ended    
                                                                31 December       31 December           30 June    
                                                                       2018              2017              2018    
R'000                                                              Reviewed         Unaudited*          Audited    
Cash (utilised by)/generated from operations                     (1 691 418)          595 079           185 515    
Net cash (utilised by)/generated from operations                   (517 904)        1 427 050         2 342 134    
Net finance costs and taxation flows                                 64 970            (6 555)         (225 550)    
Net dividend flows                                               (1 238 484)         (825 416)       (1 931 069)    
Cash retained from investing activities                           1 472 663           958 900         2 632 751    
Dividends received from joint venture entity                      1 750 000         1 000 000         3 000 000    
Net capital expenditure                                            (277 337)          (41 100)         (367 249)    
Cash generated/(utilised) by financing activities                   523 790          (65 485)             4 753    
Increase in cash for the period                                     305 035         1 488 494         2 823 019    
Cash resources at beginning of period                             8 449 797         5 626 778         5 626 778    
Cash resources per statement of financial position                8 754 832         7 115 272         8 449 797    
* The net cash generated from operations, net finance costs and taxation flows, net dividend flows, dividends 
  received from joint venture entity and net capital expenditure lines were included in these results with 
  H1 FY18 being restated accordingly to clarify the movements in cash generated from operations and cash 
  retained from investing activities.                                                         


CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
                                                                  Half-year         Half-year              Year          
                                                                      ended             ended             ended          
                                                                31 December       31 December           30 June          
                                                                       2018              2017              2018          
R'000                                                              Reviewed         Unaudited           Audited          
Share capital, share premium and other reserves                                                                          
Balance at beginning of period                                      523 327           563 925           341 223          
Other comprehensive income for the period                            77 434            26 055           182 104          
Net increase in the market value of financial assets           
measured at fair value through other comprehensive             
income (2017: net increase in the market value of              
available-for-sale investments)                                       1 625            30 186            32 933          
Actuarial gains on pension plan after taxation                            -                 -            17 206          
Foreign currency translation reserve arising on consolidation        75 809            (4 131)          131 965          
Balance at end of period                                            600 761           589 980           523 327          
Treasury shares                                                                                                          
Balance at beginning of period                                   (5 065 510)       (5 062 848)       (5 062 848)          
Acquired during the period                                           (1 532)           (2 662)           (2 662)          
Balance at end of period                                         (5 067 042)       (5 065 510)       (5 065 510)          
Retained earnings                                                                                                        
Balance at beginning of period                                   30 633 535        27 370 925        27 370 925          
Profit for the period attributable to shareholders                2 915 592         2 454 375         5 119 329          
Ordinary dividends declared during the period                    (1 238 484)         (825 416)       (1 856 719)          
- total dividends declared                                       (1 675 284)       (1 116 856)       (2 512 926)          
- dividends on treasury shares held in BEE trusts                   436 800           291 440           656 207          
Balance at end of period                                         32 310 643        28 999 884        30 633 535          
Ordinary shareholders' interest                                  27 844 362        24 524 354        26 091 352          
Non-controlling shareholders' deficit                                                                                    
Balance at beginning of period                                      (40 990)          (24 348)          (24 348)          
Share of total comprehensive (loss)/income                          (21 194)           22 471           (16 642)          
Total comprehensive (loss)/income for the period                    (21 194)           23 402            57 709          
- profit for the period                                              16 410            27 371            55 673          
- other comprehensive (loss)/income                                 (37 604)           (3 969)            2 036          
- dividends paid to non-controlling shareholders                          -              (931)          (74 351)          
Balance at end of period                                            (62 184)           (1 877)          (40 990)          
Total equity                                                     27 782 178        24 522 477        26 050 362          


SEGMENTAL INFORMATION                            
                                                             Joint venture mining and beneficiation
R'000                                                Iron ore        Manganese         Chrome         Sub-total        
Half-year ended                                    
31 December 2018 - Reviewed                       
Revenues by source                                                                                                    
Third party                                         9 110 948        7 178 070              -        16 289 018        
Inter-segment                                               -                -              -                 -        
Total revenues                                      9 110 948        7 178 070              -        16 289 018        
Revenues from contracts                            
with customers:                                     8 603 078        7 168 880                       15 771 958        
Cost, insurance and                                
freight (CIF) and cost                             
and freight (CFR)                                   4 254 863        4 912 382              -         9 167 245        
Free on board (FOB) and                            
free carrier (FCA)                                  4 348 215        2 256 498              -         6 604 713        
Commissions                                                                  -              -                 -        
Other revenues3                                       294 984            9 190              -           304 174        
Fair value adjustments to                          
contract revenues2                                    212 886                -              -           212 886        
Total revenues                                      9 110 948        7 178 070              -        16 289 018        
Contribution to profit                              2 431 917        1 853 903         (7 021)        4 278 799        
Impairment of financial and                        
non-financial assets                                        -           28 264              -            28 264        
Half-year ended                                    
31 December 2017 - Unaudited                                                                                       
Revenues                                                                                                              
Third party                                         7 900 942        5 962 454         82 860        13 946 256        
Inter-segment                                               -                -              -                 -        
Total revenues                                      7 900 942        5 962 454         82 860        13 946 256        
Revenues from contracts                            
with customers:                                     7 640 328        5 962 454         82 860        13 685 642        
Cost, insurance and                                
freight (CIF) and cost                             
and freight (CFR)                                   3 417 145        3 254 457         81 782         6 753 384        
Free on board (FOB) and                            
free carrier (FCA)                                  4 223 183        2 707 997          1 078         6 932 258        
Commissions                                                 -                -              -                 -        
Other revenues3                                       321 216                -              -           321 216        
Fair value adjustments to                          
contract revenues2                                    (60 602)               -              -           (60 602)      
Total revenues                                      7 900 942        5 962 454         82 860        13 946 256        
Contribution to profit                              1 745 668        1 743 077        (18 536)        3 470 209        
Impairment of financial and                           
non-financial assets                                        -                -              -                 -     

Other mining activities include the group's pyrophyllite and related business and the remainder of its operations.
Notes:
1 The majority of adjustments to revenues give effect to joint venture revenues, which are not disclosed 
  as Assmang is equity accounted.
2 Provisional to final price adjustments.
3 Mainly dividends and interest.
4 Local sales made by Minerais US LLC in the USA.


SEGMENTAL INFORMATION (continued)
                                                                                       Other                        
                                                                                      mining                        
                                                                                 activities,                        
                                                                Marketing       eliminations                        
                                                                      and                and                        
R'000                                       Dwarsrivier          shipping        adjustments1      Consolidated     
Half-year ended                          
31 December 2018 - Reviewed              
Revenues by source                                                                                                 
Third party                                   1 852 017         2 041 156        (16 234 629)         3 947 562     
Inter-segment                                         -            64 045            (64 045)                 -     
Total revenues                                1 852 017         2 105 201        (16 298 674)         3 947 562     
Revenues from contracts                  
with customers:                               1 800 306         1 805 344        (15 771 958)         3 605 650     
Cost, insurance and                      
freight (CIF) and cost                   
and freight (CFR)                                88 026                 -         (9 167 245)            88 026     
Free on board (FOB) and                  
free carrier (FCA)                            1 712 280         1 244 9214        (6 604 713)         2 957 201     
Commissions                                           -           560 423                  -            560 423     
Other revenues3                                  51 711           299 857           (313 830)           341 912     
Fair value adjustments to                
contract revenues2                                    -                 -           (212 886)                 -     
Total revenues                                1 852 017         2 105 201        (16 298 674)         3 947 562     
Contribution to profit                          274 853           503 396         (2 125 046)         2 932 002     
Impairment of financial and              
non-financial assets                                  -                 -            (14 132)            14 132     
Half-year ended                          
31 December 2017 - Unaudited                                                                            
Revenues                                                                                                           
Third party                                   1 981 955         1 862 603        (13 949 226)         3 841 588     
Inter-segment                                         -            69 182            (69 182)                 -     
Total revenues                                1 981 955         1 931 785        (14 018 408)         3 841 588     
Revenues from contracts                  
with customers:                               1 949 026         1 613 466        (13 685 642)         3 562 492     
Cost, insurance and                      
freight (CIF) and cost                   
and freight (CFR)                               800 601                 -         (6 753 384)           800 601     
Free on board (FOB) and                  
free carrier (FCA)                            1 148 425         1 155 2924        (6 932 258)         2 303 717     
Commissions                                           -           458 174                  -            458 174     
Other revenues3                                  32 929           318 319           (393 368)           279 096     
Fair value adjustments to                
contract revenues2                                    -                 -             60 602                 -     
Total revenues                                1 981 955         1 931 785        (14 018 408)         3 841 588     
Contribution to profit                          440 045           375 774         (1 804 283)         2 481 746     
Impairment of financial and              
non-financial assets                                  -                 -            (21 564)           (21 564) 

Other mining activities include the group's pyrophyllite and related business and the remainder of its operations.
Notes:
1 The majority of adjustments to revenues give effect to joint venture revenues, which are not disclosed 
  as Assmang is equity accounted.
2 Provisional to final price adjustments.
3 Mainly dividends and interest.
4 Local sales made by Minerais US LLC in the USA.


CORPORATE INFORMATION

Directors
Executive
Desmond Sacco (Chairman)
CE Walters (Chief Executive Officer)
PE Sacco (Deputy Chief Executive Officer)
RA Davies (Chief Financial Officer)
BH van Aswegen (Group Technical and Operations Director) 

Non-executive
EM Southey* (Deputy Chairman and Lead Independent Director)
DN Aitken*,TN Mgoduso*, S Mhlarhi*, WF Urmson*
*Independent

Registered office
Assore House, 15 Fricker Road
Illovo Boulevard
Johannesburg, 2196

Company Secretary
African Mining and Trust Company Limited

Transfer office
Singular Systems Proprietary Limited
28 Fort Street
Birnam
Johannesburg, 2196

Sponsor 
The Standard Bank of South Africa Limited
30 Baker Street
Rosebank
Johannesburg, 2196

For more information please visit
www.assore.com

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