ARM earnings decline on reduced sales

African Rainbow Minerals (ARM) on Monday reported a drop in full-year headline earnings, hit by a drop in sales and prices and a stronger rand against the US dollar.

ARM’5s headline EPS fell to 1 094 cents compared with 1 906 cents the previous year, at the upper end of its own forecast of a drop to between 1 025 and 1 150 cents.

“The massive global slowdown in the demand for resources, impacting three quarters of this financial year, resulted in lower US dollar commodity prices and reduced sales volumes for most operations, most notably manganese ore, since October 2008,” it said in a statement.

Headline EPS is the main profit gauge in South Africa and strips out certain one-off, financial and non-trading items.

ARM, which produces manganese, chrome, iron and thermal coal and has an exposure to platinum, said it expects demand for certain commodities to rise.

The company declared an annual dividend of 175 cents per share. - Reuters