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TheStreet Open House

Anglo American Platinum Says It Lost $715M In 2012

In a separate note to investors Monday, Anglo American announced it would take a $225 million loss from its stake in Amplats.

While the labor unrest has largely stopped in South Africa's mines, the financial impacts of the strikes continue to ripple across the country. Harmony Gold Mining Co. Ltd. has announced plans to potentially close one of its mines. Gold Fields Ltd. said in November it wanted to spin off two mines affected by the strikes.

However, Harmony Gold announced Monday fourth-quarter results that showed a 16 percent increase in operating profits to $188 million. Higher gold prices and lower operating costs helped the company's profit, it said.

In January, Amplats said a nearly yearlong review found that four of its mine shafts needed to be closed and one mine sold because of unprofitable operations. The company said it planned to eliminate some 14,000 jobs â¿¿ with 13,000 of them at their Rustenburg operations. The possible Amplats closures drew immediate criticism from labor unions and some members of South Africa's governing African National Congress political party, raising the possibility that the company will face a labor and political battle in trying to shutter those operations.

The mining industry is a huge part of the economy in South Africa, which is the world's largest producer of platinum, gold and chromium. Most mine workers who carry out manual labor are black and earn low salaries. The South African Institute of Race Relations says that the unemployment rate for black South Africans was nearly 41 percent in 2012, while the corresponding rate for white South Africans was 7.5 percent.

___

Online:

Anglo American Platinum Ltd.: www.angloplatinum.com

Anglo American PLC: www.angloamerican.com

___

Jon Gambrell can be reached at www.twitter.com/jongambrellAP .

Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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