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Lonmin full year results
Lonmin’s performance during the year was dominated by low prices for platinum group metals, with the impact on profits worsened by high costs, with the company making a loss for a full year.
Prices have recovered to levels that are not reasonable by historical standards, but are well below highs achieved in 2008.
These metals (unlike gold) have a range of important industrial use, and their price is therefore sensitive to the economy. That, combines with the improving trend that can be seen on price charts is reason for optimism about the current year on price.
The company is also tying to deal with its cost and operational problems. Senior management are moving from London to Johannesburg to get a “better grip” on its operations. However, that does not mean the problems will be successfully dealt with.
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