Wrap Text
Unaudited condensed consolidated interim financial results for the period ended 31 August 2025
Announcement of unaudited condensed consolidated interim financial results
for the period ended 31 August 2025
Afrimat Limited ('Afrimat' or 'the Company' or 'the Group including its subsidiaries')
(Incorporated in the Republic of South Africa)
(Registration Number: 2006/022534/06)
Share code: AFT
ISIN code: ZAE000086302
HIGHLIGHTS
- Group revenue up 29,9% to R5,3 billion
- Interim dividend per share of 20,0 cents
- HEPS up 92,3% to 101,9 cents
- Operating profit up 29,8% to R379,8 million
- Net asset value ('NAV') per share 2 951 cents
COMMENTARY
BASIS OF PREPARATION
The short-form announcement is the responsibility of the directors and is only a summary of the information
in the unaudited condensed consolidated interim financial results for the period ended 31 August 2025
('Interims') and does not contain full or complete details. The full Interims can be found at:
https://senspdf.jse.co.za/documents/2025/jse/isse/AFT/FY26H1.pdf
Copies of the full Interims are also available for viewing on the Company's website at:
https://www.afrimat.co.za/investor-relations/financials/#78-99-wpfd-interim-results.
Any investment decision should be based on the consideration of the full Interims published on the
Company's website and on SENS, as a whole, as the information in this short-form announcement does
not contain full or complete details.
The Interims have been prepared under the supervision of the Chief Financial Officer ('CFO'), PGS de Wit
CA(SA).
INTRODUCTION
The focus for the period under review was on meticulous operational execution to ensure that Afrimat
unlocks the full potential of its diversified asset base. The newly acquired assets from the troubled Lafarge
South Africa have been fully integrated into Afrimat's structures and good progress was made with the
turnaround of these businesses. The Group has made several key improvements, and the results of these
interventions are now becoming tangible.
The first quarter ('Q1') reflected a continuation of the prior year's challenges; however, by the second quarter
('Q2'), the benefits of the implemented improvements began to gain momentum. A significant increase in
local iron ore sales, coupled with satisfactory international sales, resulted in an overall strong performance
from the iron ore component of the Bulk Commodities segment.
In the aggregates segment of the business, focus was placed on instilling the Afrimat Way within the
quarries acquired and elevating the standard of product availability and customer service, ultimately
leading to an improvement in aggregate sales volumes, accompanied by a corresponding increase in
market share. This improvement was visible towards the end of Q2 after contending with excessive rainfall
in Q1.
The turnaround of the ex-Lafarge cement factory in Lichtenburg gained momentum towards the end of
the reporting period with a much-improved performance in the weeks after the reporting period, which is
very encouraging and supports the strategic positioning of our low-cost cement products. Positive
momentum has been established.
FINANCIAL RESULTS
Group revenue increased by 29,9% from R4,1 billion to R5,3 billion, supported by the integration of the
Lafarge businesses and overall volume and sales increases from iron ore and cement.
During the current period, the comparative information relating to the gain on the bargain purchase of the
Lafarge assets for August 2024 was retrospectively adjusted (refer to note 20 of the Interims).
Operating profit increased by 29,8% to R379,8 million (August 2024 (restated) R292,6 million), with an
operating profit margin of 7,1%.
Despite finance costs increasing to R148,4 million, every effort is being made, including the sale of non-core
and unprofitable assets, to ensure that debt is settled as quickly as possible. The sale process of assets, in
accordance with the Competition Commission's requirements, is now at an advanced stage. All necessary
efforts are being undertaken to ensure the transaction is concluded as efficiently and expeditiously as
possible. Afrimat has also sold brick and block operations that it felt were no longer core to its Construction
Materials businesses.
The net debt:equity position of the Group is 52,5%, representing a marginal increase compared to the
position as at February 2025. This increase is the result of a further investment in working capital due to
increased iron ore sales.
After the investment of both time and resources in integrating the Lafarge acquisition, fixing previously
neglected Lafarge assets, turning the Nkomati business around, and ensuring a high-quality iron ore
product, profit after tax improved by 78,9% to R173,5 million (August 2024 (restated): R96,9 million).
This translated into improved earnings and headline earnings per share of 102,7 cents per share and
101,9 cents per share, respectively (August 2024 (restated): 58,3 cents per share and 53,0 cents per share,
respectively).
Cash generated from operations improved significantly to R357,7 million compared to cash used in
operations in the previous comparable period of R131,4 million. The increase was supported by increased
sales volumes in cement and iron ore.
OPERATIONAL REVIEW
All operating units are strategically positioned to deliver outstanding service to customers, whilst acting
as an efficient hedge against volatile local business conditions. The product range is wide and diversified
and is made up of Construction Materials consisting of aggregates, concrete-based products, fly-ash and
cement; Industrial Minerals consisting of limestone and dolomite; and Bulk Commodities consisting of iron
ore and anthracite. The Services segment consists of external logistical and mining services, while the
Future Materials and Metals segment is made up of phosphate and rare earth elements.
Construction Materials
The aggregate and ash components of this segment were affected by excessive rainfall in the northern
regions of South Africa during Q1, which limited orders of aggregates. During Q2, improved sales volumes
were evident, with operational efficiency at the former Lafarge quarries leading to previously lost market
share being regained. This was achieved by delivering better service and ensuring product availability for
customers. The momentum is expected to continue into the second half of the year.
Revenue grew by 9,1% to R1,9 billion (August 2024: R1,8 billion), while the operating profit grew to
R321,2 million (August 2024: R290,1 million). This is mainly due to the final integration and investment into
the acquired Lafarge quarries. The fly-ash business and the readymix batching plants performed very well.
All Holcim information systems were successfully migrated onto the Afrimat system at the end of August
2025, resulting in substantial monthly cost savings going forward.
Revenue for the cement business rose by 118,8% to R873,7 million, but it was loss-making at the operating
profit level. Plant reliability showed a significant improvement towards the end of the reporting period,
resulting in fewer production disruptions. The operation continues to benefit from strong product demand,
and its strategic positioning as a low-carbon, high-quality cement remains effective. The Group remains
excited about the potential of product innovation.
Bulk Commodities
The Bulk Commodities segment provided a healthy contribution to the Group. Both revenue and operating
profit increased by 53,6% and 56,8%, respectively, from the previous period. The iron ore mines' revenue
increased by 77,9% to R1,7 billion (August 2024: R934,7 million). At an operating profit level, an increase
of 73,5% was attained, resulting in an operating profit increase from R232,6 million to R403,5 million.
Iron ore - domestic
A significant increase in local iron ore sales volumes was recorded when compared to the comparative
period. Afrimat has worked hard to ensure sustainable sources of supply and continues to meet the needs
of its customers. Volumes increased to 830 662 tonnes (31 August 2024: 339 648 tonnes).
Iron ore - international
Total international iron ore export volumes increased to 396 384 tonnes (31 August 2024: 349 084 tonnes).
The expectation is that the full-year volumes will be similar to the previous year, approximately 17,0%
below Afrimat's yearly allocation of 870 000 tpa, primarily due to logistics availability on the Saldanha
export line as a result of a maintenance shutdown of the line during the second half.
Anthracite - domestic
Operational improvements at Nkomati Anthracite Mine were successfully implemented, and with a full EIA
in place, the mine processed 100 000 tonnes in July 2025. An assessment of underground viability led to
the mothballing of the underground mining operation. Due to decreased demand from ferrochrome smelters
during the period, volumes amounted to 136 216 tonnes (31 August 2024 volumes: 155 686 tonnes).
Unfortunately, in August 2025, due to structural economic impediments in the local economy, all
ferrochrome smelters were temporarily shut down.
Anthracite - international
The Mozambique border has reopened, and two shipments of anthracite were exported, totalling 61 861
tonnes when compared to the previous period (31 August 2024 volumes: 41 568 tonnes), with additional
shipments expected for the remainder of the financial year. Management is currently exploring all possible
options, including significantly increased exports, to secure the mine's future in case of a prolonged
shutdown of all ferrochrome smelters. Shareholders will be updated on the progress when there is better
clarity.
Industrial Minerals
Although a very small part of the Group, this business unit was also impacted by the shutdown of the
ferrochrome smelters and the closure of the Newcastle steelworks. Revenue declined by 16,8% to
R270,6 million (August 2024: R325,1 million), and operating profit dropped to R22,5 million from
R68,6 million in the previous period.
Future Materials and Metals
Exciting progress was made with test work to unlock the full potential of this unique reserve. Encouraged
by promising applications in the battery and magnet markets, significant progress has been made with
local operators and international partners to develop the business case, which should not require significant
further capital investment from Afrimat. Revenue from phosphate product sales increased to R53,7 million
(August 2024: R38,9 million) but as the business is still ramping up, it incurred an operating loss of
R24,8 million.
BUSINESS DEVELOPMENT
The Group's business development team remains a key component of the Group's strategy. The team
continues to identify opportunities in existing markets, as well as in anticipated new high-growth areas in
southern Africa.
PROSPECTS
The performance of the cement plant is expected to improve as reliability and throughput increase following
a detailed strategic review of kiln performance. Demand for low-carbon, high-quality cement remains strong
in both bagged and bulk formats.
The assets acquired in the Lafarge transaction are either profitable or demonstrating strong momentum. The
fly-ash operations are highly profitable and Afrimat's cement extender strategy is gaining momentum. The
grinding plant is profitable and the cement blending and packaging plants will be capable of supporting
current and future volumes.
Post the interim period, the acquired Lafarge quarries are further increasing sales by regaining market share
and developing new markets supported by a strong national presence. Afrimat is well-positioned to benefit
from road and rail maintenance, private building projects, provincial maintenance, infrastructure projects,
and large-scale infrastructure and building initiatives across our borders.
Afrimat expects domestic iron ore sales to be slightly lower in the second half of the financial year due to
the closure of AMSA's Newcastle operation.
International iron ore sales are projected to remain at similar levels to the previous year. The recent rise in
iron ore prices is a positive development.
Unfortunately, due to the possibility of ferrochrome smelter closures in South Africa, management is
currently evaluating viable options for the Nkomati Anthracite Mine. What is encouraging is that the sector
and the Government are in discussions to secure sustainable electricity tariffs, thus maintaining
competitiveness. Afrimat remains hopeful that no further erosion of industrialisation will occur in South Africa.
Despite the structural economic challenges in South Africa, Afrimat's management is confident that the
foundation and diversification of the Group are sound. The Group will continue to support its customers
while also exploring alternative markets. The effort spent to ensure future performance is resilient, with
continued investment in operational reliability supporting a positive outlook for improved returns.
These financial statements may contain forward-looking statements that have not been reviewed nor
reported on by the Company's auditors.
On behalf of the Board
FM Louw
Chairman
AJ van Heerden
Chief Executive Officer
Wednesday, 22 October 2025
FINANCIAL SUMMARY
Restated
Unaudited unaudited
six months six months Audited
ended ended year ended
31 August 31 August 28 February
2025 2024 Change 2025
R'000 R'000* % R'000
Revenue 5 330 059 4 103 351 29,9 8 317 766
Operating profit* 379 828 292 633 29,8 477 735
Profit attributable to shareholders* 173 465 96 938 78,9 113 510
Earnings per ordinary share (cents)* 102,7 58,3 76,2 63,0
Diluted earnings per ordinary share (cents)* 101,8 57,5 77,0 62,2
Headline earnings per ordinary share ('HEPS') (cents) 101,9 53,0 92,3 72,3
Diluted HEPS (cents) 101,0 52,3 93,1 71,4
Dividends per share (cents) 20,0 10,0 100,0 15,0
Net cash from operating activities 134 909 (272 372) 149,5 239 754
Net asset value per share ('NAV') (cents)* 2 951 2 865 3,0 2 862
Net debt:equity ratio (%)* 52,5 48,4 8,5 48,9
SEGMENTAL INFORMATION
External revenue
Construction Materials (aggregates) 1 936 323 1 774 485 3 541 008
Construction Materials (cement) 873 668 399 250 1 011 659
Industrial Minerals 270 580 325 114 575 149
Bulk Commodities 2 160 521 1 406 314 2 825 071
Future Materials and Metals 53 676 38 921 68 054
Services 35 291 159 267 296 825
5 330 059 4 103 351 8 317 766
Operating profit#
Construction Materials (aggregates) 321 178 290 115 550 182
Construction Materials (cement) (127 116) (115 855) (219 628)
Industrial Minerals 22 483 68 621 116 704
Bulk Commodities 445 138 283 968 486 886
Future Materials and Metals (24 826) (21 108) (34 980)
Services 22 502 29 419 113 098
Centralised shared services costs (279 531) (242 527) (534 527)
379 828 292 633 477 735
Operating profit margin on external revenue (%)
Construction Materials 6,9 8,0 7,3
Industrial Minerals 8,3 21,1 20,3
Bulk Commodities 20,6 20,2 17,2
Future Materials and Metals (46,3) (54,2) (51,4)
Overall contribution 7,1 7,1 5,7
* Measurement period adjustment - during the current period, the comparative information for
August 2024 was retrospectively adjusted in the process of finalising the accounting for the
business combination.
# During the current period, the Group refined its basis of segmental allocation. Previously, certain
centralised shared services costs were allocated to the operating segments. These costs are now
presented within a separate 'centralised shared services' segment, which reflects the manner in which
the Group's chief operating decision-maker monitors performance and allocates resources.
Comparative information has been restated to align with the current period presentation. This change
provides a more consistent representation of how segment performance is managed internally and
enhances the usefulness of the disclosure to users of the financial statements.
DIVIDEND DECLARATION
Notice is hereby given that an interim gross dividend, No. 37 of 20,0 cents per share, in respect of the six
months ended 31 August 2025, was declared on Wednesday, 22 October 2025. There are 160 297 456
shares in issue at the reporting date, of which 8 191 141 are held in treasury. The total dividend payable is
R32,1 million (August 2024: R16,0 million). The Board has confirmed that the solvency and liquidity test as
contemplated by the Companies Act, No. 71 of 2008, has been duly considered, applied and satisfied. This
is a dividend as defined in the Income Tax Act, 1962, and is payable from income reserves. The South
African dividend tax rate is 20,0%. The net dividend payable to shareholders who are subject to dividend
tax and shareholders who are exempt from dividend tax is 16,0 cents and 20,0 cents per share, respectively.
The income tax number of the Company is 9568738158.
Relevant dates to the interim dividend are as follows:
Last day to trade cum dividend Tuesday, 18 November 2025
Commence trading ex-dividend Wednesday, 19 November 2025
Record date Friday, 21 November 2025
Dividend payable Monday, 24 November 2025
Share certificates may not be dematerialised or rematerialised between Wednesday, 19 November 2025
and Friday, 21 November 2025, both dates inclusive.
Announcement date: 23 October 2025
Directors
FM Louw*# (Chairman)
AJ van Heerden (CEO)
PGS de Wit (CFO)
C Ramukhubathi
MG Odendaal
L Dotwana*
PRE Tsukudu*#
JF van der Merwe*#
JHP van der Merwe*#
S Tuku*#
NAS Kruger*#
P Joubert*#
J Breytenbach*#
* Non-executive director
# Independent
Registered office
Tyger Valley Office Park No. 2
Corner Willie van Schoor Avenue and Old Oak Road
Tyger Valley, 7530
(PO Box 5278, Tyger Valley, 7536)
Sponsor
Valeo Capital Proprietary Limited
Unit G02
Skyfall Building
De Beers Avenue, Paardevlei
7130
Auditor
PricewaterhouseCoopers Inc.
1st Floor Trumali Forum Building
Trumali Park
Corner Trumali Street and R44
Stellenbosch
7600
(PO Box 57, Stellenbosch, 7599)
Transfer secretaries
Computershare Investor Services Proprietary Limited
Rosebank Towers
15 Biermann Avenue
Rosebank
2196
(Private Bag X9000, Saxonwold, 2132)
Company Secretary
C Burger
Tyger Valley Office Park No. 2
Corner Willie van Schoor Avenue and Old Oak Road
Tyger Valley
7530
(PO Box 5278, Tyger Valley, 7536)
Date: 23-10-2025 07:05:00
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