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South Africa’s AMCU union launches strike at Sibanye’s Kroondal mine

27 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – Workers began an indefinite strike at Sibanye Gold’s Kroondal platinum mine in South Africa on Friday to demand transport because they were being attacked after working night shifts, their union said.

“The company doesn’t want to provide transport for its employees and these are basic conditions of employment,” Joseph Mathunjwa, president of South Africa’s Association of Mineworkers and Construction Union (AMCU) told Reuters.

AMCU is the main union at the Kroondal mine located in the Rustenburg platinum belt and has about 7,000 workers.

Sibanye’s spokesman James Wellsted said the gold and platinum producer would seek a court order to stop the strike because it was negatively affecting output.

“With metal prices being low for AMCU to now go on strike over issues that are being dealt with is irresponsible. This poses a threat of to the viability of the mine,” he said.

AMCU led a record and sometimes violent five-month wage strike at three major platinum producers in 2014.

Unions and platinum companies are expected to start wage talks in the next few weeks.

Sibanye acquired the Kroondal mine when it bought Aquarius Platinum in October last year for $295 million.

 

 

(Reporting by Zandi Shabalala; Editing by James Macharia)

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Anglo American appoints Bruce Cleaver CEO of De Beers

27 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

(Reuters) – Global mining company Anglo American Plc said it appointed Bruce Cleaver as chief executive of its diamond mining unit De Beers Group, after previous CEO Philippe Mellier decided to step down.

De Beers, the world’s largest diamond producer by value, will remain part of Anglo American’s operations even after a radical restructuring of the latter, in the belief that surging Chinese and Indian demand for diamonds will outstrip dwindling supply.

Cleaver, previously group director of strategy and business development, will take over the role on July 1, the company said.

Cleaver, 51, was first appointed to De Beers’ board in 2008 and served as its co-acting CEO in 2010 prior to Mellier’s appointment.

Anglo American has an 85 percent stake in De Beers.

 

(Reporting by Mamidipudi Soumithri in Bengaluru; Editing by Anupama Dwivedi and Sunil Nair)

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South African retailer Foschini posts 18% profit jump

26 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – South African clothing retailer Foschini Group reported an 18 percent rise in full-year profit on Thursday, boosted by last year’s acquisition of British chain Phase Eight.

Foschini, which is expanding outside South Africa as consumer spending tightens in its home market, said that headline earnings per share (EPS) rose to 1,056 cents for the year to March 31, from 898 cents the previous year.

Headline EPS is the main profit measure in South Africa and strips out certain one-off items.

“The group’s overall gross margin has improved from 47.3 percent to 49.7 percent, mainly as a result of the higher Phase Eight clothing margin,” the company said.

South African clothing retail relies heavily on in-store credit cards, but more stringent affordability measures in Africa’s most advanced economy led to a slowdown in the second half of the reporting period, Chief Financial Officer Anthony Thunstrom told Reuters.

Foschini has instead focused on increasing cash sales, which accounts for less than half of turnover excluding Phase Eight but was boosted to 58 percent by the British retailer, making the group less vulnerable to the credit cycle, Thunstrom said.

The company said it plans to open at least 50 more Phase Eight stores this financial year.

Sales also benefited from the inclusion of the British retailer and rose 31.2 percent to 21.1 billion rand ($1.4 billion). Excluding Phase Eight, the increase was 11.6 percent.

The retailer extended its push into the northern hemisphere, buying British high street chain Whistles in March, as consumers in South Africa rein in spending because of higher interest rates, rising energy costs and unemployment at more than 25 percent.

Foschini has been the best performer among South Africa’s listed fashion retailers this year, with its shares rising more than 17 percent, against a 6 percent decline for larger rival Mr Price.

Shares in Foschini were up 2 percent at 141.85 rand by 1357 GMT, paring gains of more than 3 percent before the release of its annual results.

($1 = 15.5615 rand)

 

(Reporting by TJ Strydom; Editing by Susan Fenton and David Goodman)

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African Union insurance arm to boost disaster cover to $1.5 bln

26 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

LUSAKA (Reuters) – The African Union’s insurance arm will increase its disaster cover to $1.5 billion by 2020 from $179 million currently following one of the continent’s worst droughts in decades, a senior executive said on Thursday.

Drought has ravaged much of southern Africa this year and Malawi’s government said on Wednesday half its population is in need of food aid due to the prolonged dry period.

African Risk Capacity (ARC) now plans to expand insurance coverage against drought, floods and cyclones to more than 150 million Africans in disaster risk in 30 countries.

“The idea is to make sure that when trouble comes, the resources are available on time,” ARC Director-General Mohamed Beavogui told Reuters. “If I know that drought might happen and what the magnitude is, I can plan for it.”

Niger, Senegal, Gambia, Mali, Malawi, Mauritania and Kenya have already bought insurance from ARC while Zimbabwe, Burkina Faso and Madagascar are expected to buy drought cover in the next month, Beavogui said.

ARC plans to introduce a tropical cyclone insurance later this year and flood insurance in 2017. The impact of climate change is resulting in more severe droughts, floods and cyclones across Africa, Beavogui said.

Last year, Senegal received a payout of over $16 million from ARC after paying a premium of $3 million following a poor agricultural season due to severe drought in 2014.

The G7 Summit in Germany last year adopted an initiative on Climate Risk Insurance which aims to increase access to cover against the impacts of climate change for up to 400 million of the most vulnerable people in developing countries by 2020.

 

(Reporting by Chris Mfula; Editing by Joe Brock)

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Nigeria finmin says gov’t revenues fall in April due to oil

26 May 2016 Comments (0) Africa, Latest Updates from Reuters, Politics

ABUJA (Reuters) – Nigeria’s distributable revenues to the three tiers of government fell in April to 281.5 billion naira ($1.42 billion), down 18.25 billion naira from March due to low oil prices, the West African country’s finance minister said on Wednesday.

The fall in revenue was caused by the “drop in the average price of crude oil,” Finance Minister Kemi Adeosun told journalists.

“A marginal drop in income was recorded from oil and gas royalties and import duties,” she added.

Nigeria, a member of OPEC, relies on crude sales for about 70 percent of its government revenues.

But with Africa’s largest economy now contracting, uncertainty around a foreign exchange policy shift that was announced without full details being provided and a new Niger Delta insurgency sending oil output to a 20-year low, it is a plight that gets worse by the day. [nL5N18K2X9]

The sharp fall in global crude prices since mid-2014, has hurt the country’s public funds and left many states unable to pay public salaries on time or fund infrastructure projects and other state services.

($1 = 198.8000 Nigerian naira)

 

(Reporting by Camillus Eboh, writing by Alexis Akwagyiram, editing by G Crosse)

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ArcelorMittal South Africa says Saldanha steel plant will keep operating

25 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – ArcelorMittal South Africa’s Saldanha plant will keep operating, its chairman said on Wednesday, after the facility was placed under review earlier this year due to low steel prices and rising costs.

The plant, north of Cape Town is the newest in the company’s fleet and was opened in 1998 to focus specifically on steel exports, but low steel prices and high electricity and transport costs made it unprofitable last year.

“As the board, we are comfortable that we will have a Saldanha that is a good, healthy, performing business for a long period,” said ArcelorMittal South Africa Chairman Mpho Makwana.

The weaker rand and a pickup in West African steel demand have since ensured the plant’s viability, said acting Chief Executive Dean Subramanian.

South Africa’s currency lost about a quarter of its value from end of May last year until now, providing relief to some of the nation’s exporters.

Subramanian and Makwana were speaking at the release of report on ArcelorMittal’s contribution to South Africa’s economy, which also stated that the plant was responsible for 16 percent of the steel produced in Africa’s most industrialised country.

ArcelorMittal will start maintenance at Saldanha in August, which Subramanian said would increase the plant’s life by up to five years.

 

(Reporting by TJ Strydom; Editing by James Macharia)

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MTN Group sees pressure on profit margins in South Africa, Nigeria

25 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – MTN Group expects earnings to be under pressure for the rest of the year in its two main markets Nigeria and South African market, the company said on Wednesday, citing a weak exchange rate in Africa’s biggest economy.

Africa’s biggest mobile network operator by subscribers said in statement that weak economic growth in its key markets and tough competition could also negatively impact performance.

MTN said it was still negotiating a $3.9 billion fine by Nigerian authorities as the west African country.

Nigeria is pushing telecoms firms to verify the identity of subscribers amid worries that unregistered SIM cards were being used for criminal activity in a country still battling with Islamic militant group Boko Haram.

 

(Reporting by Zandi Shabalala; Editing by James Macharia)

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Nigeria to adopt flexible FX regime, details to follow

24 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

ABUJA (Reuters) – Nigeria’s central bank is adopting a flexible foreign exchange rate regime, Governor Godwin Emefiele said on Tuesday, in a policy U-turn designed to boost exports and stave off a recession in Africa’s biggest economy.

The bank has previously kept a de facto peg of around 197 naira per dollar but that has become unsustainable due to a shortage of hard currency stemming from a slump in oil revenues.

On the parallel market, the naira has fallen to some 40 percent below the official rate.

“The MPC (Monetary Policy Committee) voted unanimously to adopt a flexible exchange rate policy to restore the automatic adjustment properties of the exchange rate,” Emefiele told reporters.

Details of the new rules would be published in a few days, he added.

He said the central bank would “retain a small window for funding critical transactions” and that “details of operations of the market would be released by the central bank at the appropriate time”.

On Monday, the government said it would use a lower rate of 285 naira per dollar for petrol imports rather than the pegged official rate of 197.

 

(Reporting by Camillus Eboh, Ulf Laessing and Alexis Akwaqyiram; Editing by Ed Cropley and Catherine Evans)

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Kenya Airways says fixing weaknesses found after forensic audit

24 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

NAIROBI (Reuters) – Kenya Airways said on Tuesday preliminary results of a forensic audit had helped it identify weaknesses in its systems and internal controls, and it was taking remedial action that included disciplining some staff.

The statement, following the audit by Deloitte Consulting, did not give details about the actions taken by those staff.

The airline has been working on a turnaround plan after more than three years of financial losses.

 

 

(Writing by Edmund Blair; Editing by Mark Potter)

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South Africa’s Ascendis Health buys two European firms, shares rise

24 May 2016 Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – South Africa’s Ascendis Health Ltd said on Tuesday it bought two European companies as part of its plan to expand globally and diversify its pharmaceutical products, sending its shares higher.

The health and care company will buy Cyprus-based pharmaceutical firm Remedica Holdings Ltd for between 260 million euros ($291 million) and 335 million euros and sports nutrition company Scitec International for 170 million euros.

Ascendis shares rose 2.95 percent to 23 rand.

The firm – which bought Spanish pharmaceutical company Farmalier S.A. in August last year – said it received the backing of 63 percent of its shareholders for the acquisitions which will be funded through a combination of debt, shares and proceeds from a rights issue.

Shareholders and new investors supported Ascendis’ proposed rights offer of 1.8 billion rand, the company said.

($1 = 0.8926 euros)

 

(Reporting by Zandi Shabalala; Editing by James Macharia)

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