Merafe Resources Limited has issued a trading statement projecting a significant increase in earnings for the year ended 31 December 2023. The company anticipates robust growth in both basic earnings per share (EPS) and headline earnings per share (HEPS), driven by favourable market conditions and operational performance.
Strong Financial Performance Anticipated
According to the trading statement released by Merafe Resources Limited, the company expects to report EPS of between 64.5 cents and 75.7 cents for the 2023 financial year. This marks an improvement of 14% to 34% compared to the prior comparative period. Similarly, HEPS is projected to range between 58.7 cents and 69.9 cents, reflecting an increase of 4% to 24% from the previous year.
The anticipated growth in earnings is attributed to several factors, including a weaker ZAR:US$ exchange rate, increased chrome ore sales volumes, and higher realized prices. These favorable market dynamics have positively impacted Merafe’s financial performance, contributing to the expected improvement in earnings.
Cash Balances and Investments
Merafe Resources Limited also provided insights into its expected cash balances for the year ended 31 December 2023. The company’s cash and cash equivalents balance stood at R1,656 million, representing an increase from R1,604 million reported in the previous period.
| 31 Dec 2023 | 30 Jun 2023 | |
|---|---|---|
| Cash and cash equivalents balance (R’m) | 1,656 | 1,604 |
Additionally, Merafe holds a significant share of the cash balance in the Glencore-Merafe Chrome Venture (“Venture”). The cash held by the Venture includes funds allocated for future environmental rehabilitation obligations, with Merafe’s share amounting to R328 million.
Upcoming Financial Reporting
Shareholders can expect the release of Merafe Resources Limited’s financial results for the year ended 31 December 2023 on or before 18 March 2024. The company’s board of directors emphasizes that the financial information provided in the trading statement is their responsibility and has not been reviewed or reported on by external auditors.
Conclusion
Merafe Resources Limited’s optimistic trading statement reflects its strong performance in 2023, driven by favorable market conditions and operational efficiency. The projected increase in earnings, coupled with healthy cash balances, positions the company well for continued growth and value creation for its shareholders.
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