South Africa-based ferrochrome producer Merafe Resources which holds a 20.5 percent share in the joint Glencore-Merafe Chrome Venture, has announced its interim results for the six months ended June 30 this year. In the given period, Merafe Resources reported a net loss of ZAR 961 million ($56.67 million) compared to the net profit of ZAR 165 million in the same period of the previous financial year.
The performance of the company was affected by the decreased stainless steel production in China and the shutdown of plants amid the coronavirus. Chinese stainless steel production in the first quarter of the year plummeted to levels last seen in early 2016, while it recovered strongly during the second quarter, backed by government infrastructure spending.
The company’s revenue in the given period decreased by 16 percent to ZAR 2.34 billion ($138.3 million) compared to the same period of the previous financial year, due to lower ferrochrome prices.
In the first six months this year, the company’s EBITDA decreased by 63.9 percent to ZAR 157 million ($9.2 million) compared to ZAR 435 million in the first half of 2019.
“While the impact of the coronavirus pandemic remains a key concern, we have had to review our business to ensure that our operations continue with minimal unplanned disruptions and our growth strategy remains pursued. We will continue to closely monitor the impact of the coronavirus pandemic as well as market developments and respond accordingly,” said the company in its statement.