Integrated
Annual Report 2019
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CHIEF EXECUTIVE OFFICER'S
STRATEGIC REVIEW2019 was extremely challenging both from an operational and trading perspective. The uncertainty created by geopolitical events, such as Brexit and US/China trade wars...
ZANELE MATLALA
Chief Excutive Officer
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FINANCIAL DIRECTOR’S
REVIEWMerafe’s revenue and operating income is primarily generated from the Glencore Merafe Chrome Venture (Venture) which is one of the global market leaders in ferrochrome production...
DITABE CHOCHO
Financial Director
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CHAIRPERSON'S
REPORTOn an annual basis the Board reviews the Company’s application of the King IV principles. We are pleased to report that the Company is compliant with King IV in most material respects...
ABIEL MNGOMEZULU
Chairperson
2019 year in review |
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KEY FEATURES |
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Revenue of R5.38 billion (2018: R5.60 billion) |
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Total dividend for 2019 of R100 million (2018: R351 million) |
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Ferrochrome sales volumes of 371kt (2018: 407kt) |
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EBITDA of R392 million (2018: R1.35 billion) |
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Headline earnings of 1.8c per share (2018: 27.2c earnings per share) |
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Improved TRIFR performance of 2.56 (2018: 3.39) |
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Net loss of R1.36 billion (2018: R683 million net profit) |
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Ferrochrome sales volumes of 368kt (2018: 407kt) |
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Average ferrochrome CIF price of 79 USc/lb (2018: 92 USc/lb) |
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Fatalities: 1 (2018: 1 fatality) |
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THE GLOBAL POSITION OF FERROCHROME
Elements influencing the global demand for and pricing of ferrochrome:
- Global economic conditions
- Exchange rates
- Stainless steel demand
- Growth of Chinese ferrochrome industry
- Chrome ore exports
OUR COMPETITIVE ADVANTAGE
- Lowest-cost producer in South Africa
- Flexibility provided by variety of costefficient technologies
- Savings in energy consumption per tonne of alloy produced as a result of major investments in energy efficiency (Lion Complex and two pelletising and sintering plants)
- Lion II achieves further energy efficiencies
- Significant chrome ore reserves and access to UG2
SOUTH AFRICAN CHROME INDUSTRY
Approximately of the world's ferrochrome production of 14mt was supplied by South Africa in 2019
Over of the world's chrome reserves are in South Africa
Provides approximately direct and indirect jobs