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African Rainbow Minerals Ltd. (ARM), the Johannesburg-listed diversified mining group founded by billionaire Patrice Motsepe, trimmed its shareholder payout after annual profits fell nearly in half. Even so, Motsepe will still take home more than half a billion rand in dividends.
The board declared a final dividend of 600 cents per share (R6.00, or $0.34), down from R9.00 ($0.51) last year. That brings the total distribution for the year ended June 30 to R10.50 ($0.59) a share. ARM will return about R1.25 billion ($70.8 million) to investors through the final payout alone.
With a 45.9% holding in ARM — equal to 95.8 million shares — Motsepe will collect about R574.8 million ($32.5 million). That makes him by far the largest single beneficiary of the dividend, even as the company tightens capital spending at its struggling Bokoni platinum operation and absorbs weaker iron ore prices.
Earnings pressure
Headline earnings for the year dropped 47% to R2.7 billion ($152.5 million), compared with R5.1 billion ($288.4 million) a year earlier. Revenue edged up just 1% to R13 billion ($735.0 million) as higher manganese prices failed to offset falling iron ore and thermal coal realizations.
The iron ore unit, traditionally ARM’s biggest profit driver, saw earnings plunge 36% as export prices softened and the rand strengthened against the dollar. By contrast, manganese operations doubled earnings on the back of firmer ore prices and stronger volumes.
Losses at Bokoni Mine widened to R1.4 billion ($79.2 million) as the company suspended early mining and focused on a long-term redevelopment plan.
Cash strength and outlook
Despite the profit squeeze, ARM closed June with net cash of R6.6 billion ($373.2 million), giving it the flexibility to keep paying dividends while funding new projects. The miner also advanced construction of a solar power plant to supply its platinum operations, with commissioning expected in 2026.
ARM is one of South Africa’s largest mining groups, with interests spanning iron ore, manganese, platinum group metals, coal, and gold. Motsepe, 62, founded the company in 1997 and remains its executive chairman. His fortune is estimated at more than $3 billion, making him one of Africa’s wealthiest businessmen.
While commodity markets remain volatile, ARM has sought to balance exposure across its portfolio. The company has increased its stake in Canada’s Surge Copper Corp. to 19.9% and has implemented hedging strategies for its Harmony Gold holdings.
