Merafe Resources Shines: 11% Revenue Surge in H1 2023

  • Merafe Resources reports strong H1 2023 results with an 11% rise in revenue, reaching R4,764 million.
  • Despite lower ferrochrome production, EBITDA grows 13% to R1,548 million, reflecting operational resilience.
  • Company's focus on safety, sustainability, and innovation drives growth amid economic uncertainty and market challenges.

Merafe Resources Limited (JSE: MRF, A2X: MRF) has announced its unaudited condensed consolidated financial results for the first half of 2023. The company’s remarkable performance amidst a backdrop of economic uncertainty and sustainability imperatives underscores its resilience and commitment to sustainable growth.

Safety and Operational Excellence

In an impressive feat, Merafe recorded no fatalities during the first half of 2023, reinforcing its unwavering commitment to employee safety. The company’s Total Recordable Injury Frequency Rate (TRIFR) decreased by 17%, attesting to its dedication to maintaining a secure working environment.

However, despite a 9% decrease in ferrochrome production to 185kt, the company reported an 11% increase in revenue, reaching R4,764 million, up from R4,291 million in the same period last year. This growth was supported by higher realized chrome ore prices and a weaker ZAR:USD exchange rate.

Financial Success Amidst Challenges

Merafe’s CEO, Z Matlala, attributed the impressive financial performance to these favorable market conditions. Nevertheless, the company faced challenges, including lower ferrochrome prices and sales volumes, as well as increased costs of ferrochrome production. Despite these headwinds, Merafe managed to achieve a 13% increase in EBITDA, amounting to R1,548 million, compared to R1,373 million in June 2022.

The company’s commitment to operational efficiency and strategic capital allocation is reflected in the 22% increase in net asset value, which now stands at R5,054 million, showcasing its resilience in navigating market fluctuations.

Dividend Declaration and Market Outlook

Merafe’s board of directors approved an interim cash dividend of 20 cents per share for the six months ended June 30, 2023, an increase from the 12 cents per share declared in the same period last year. This dividend will be subject to a local dividend tax rate of 20%, resulting in a net local ordinary dividend of 16 cents per share for non-exempt shareholders.

Looking ahead, Merafe acknowledges the challenging economic environment characterized by rising inflation, interest rates, and trade tensions. The company is also keenly aware of the global shift towards a more sustainable economy and is taking steps to integrate green energy initiatives into its strategic plans. Technological innovation remains a key focus, driving efficiency and enhancing employee safety.

Table: Key Financial Metrics for H1 2023

MetricH1 2023H1 2022Change
Revenue (R million)4,7644,291+11%
EBITDA (R million)1,5481,373+13%
Headline Earnings per Share (cents)42.037.0+13.5%
Net Asset Value (R million)5,0544,145+22%
Net Cash Flows from Operating Activities795748+6%
Interim Dividend per Share (cents)20.012.0+66.7%

Navigating Challenges Ahead

The company is cautiously approaching the second half of 2023, anticipating a softer market outlook. The potential downward pressure on chrome ore prices may impact ferrochrome prices, and Merafe acknowledges the possibility of squeezed margins due to forecasted inflationary pressures.

To manage costs during periods of elevated power prices, Merafe plans to produce ferrochrome exclusively at the Lion smelter, a strategic move to lower inventory levels and enhance cost management.


Merafe Resources’ impressive financial performance and commitment to safety, sustainability, and innovation position the company for continued growth. Despite challenges, the company’s resilience and focus on operational excellence are evident in its robust financial results. As Merafe navigates an evolving economic landscape, its commitment to efficiency, sustainability, and shareholder value remains unwavering.

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