Tuesday, March01, 2011
* FY Headline EPS at 11 cts vs 6 cts loss
* Sees higher demand, prices ahead
* Shares down 6.6 pct so far this year
JOHANNESBURG, March 1 (Reuters) - South Africa's Merafe Resources (MRFJ.J: Quote), the country's largest ferrochrome producer, reported a return to full-year profit on Tuesday, helped by higher metal prices and said it expects strong results ahead.
Demand for ferrochrome, which is used in stainless steel to prevent corrosion, is recovering after the global economic crisis forced companies in top producer South Africa to slash output in 2009.
Merafe, which operates a joint venture with Xstrata (XTA.L: Quote), said headline earnings per share for the year to end-December totaled 11 cents, from a loss of 6 cents a year earlier.
Headline EPS, the key measure of profit in South Africa, excludes certain one-time items.
The company said its share of saleable ferrochrome output for the year rose to 291,000 tonnes from 281,000 tonnes in 2009, while revenue rose to 2.56 billion rand ($368 million) from 1.84 billion rand.
Merafe said it expects ferrochrome prices to trade higher in 2011 on upward demand arising from growth in stainless steel production.
The company also said restricted supply of electricity in South Africa has resulted in the postponement of a number of planned ferrochrome projects over the next five years.
The company declared a final dividend of 2 cents a share.
Merafe shares have fallen 6.6 percent so far this year, compared with a 0.48 percent fall in Johannesburg's All-share Index .JALSH. (Reporting by Marius Bosch and Olivia Kumwenda; Editing by Agnieszka Flak,sourced:Thomson Reuters)
Demand for ferrochrome, which is used in stainless steel to prevent corrosion, is recovering after the global economic crisis forced companies in top producer South Africa to slash output in 2009.
Merafe, which operates a joint venture with Xstrata (XTA.L: Quote), said headline earnings per share for the year to end-December totaled 11 cents, from a loss of 6 cents a year earlier.
Headline EPS, the key measure of profit in South Africa, excludes certain one-time items.
The company said its share of saleable ferrochrome output for the year rose to 291,000 tonnes from 281,000 tonnes in 2009, while revenue rose to 2.56 billion rand ($368 million) from 1.84 billion rand.
Merafe said it expects ferrochrome prices to trade higher in 2011 on upward demand arising from growth in stainless steel production.
The company also said restricted supply of electricity in South Africa has resulted in the postponement of a number of planned ferrochrome projects over the next five years.
The company declared a final dividend of 2 cents a share.
Merafe shares have fallen 6.6 percent so far this year, compared with a 0.48 percent fall in Johannesburg's All-share Index .JALSH. (Reporting by Marius Bosch and Olivia Kumwenda; Editing by Agnieszka Flak,sourced:Thomson Reuters)
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