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Afarak revenues rise

By BFN News | 07:09 AM | Friday 17 November, 2017

Afarak's third quarter revenues rose to €44.2m - up from €28.9m a year ago - but losses before interest, tax, depreciation and amortisation narrowed to €2.2m from €2.8m. Revenues for the first nine months rose to €148.2m from €109.2m with the group reporting earnings before interest, tax, depreciation and amortisation of €15.4m agianst €1.2m a year ago. The group said the benchmark price for charge chrome for the third quarter was higher than that of a year earlier, though significantly lower than that in the second quarter of this year. Year-on-year performance was, as a result, better, but below that registered in quarter two, reflecting seasonal trends. This was in line with the market sentiment expressed in quarter two. The group posted a third quarter loss from continuing operations of €3.9m against €3.2n a year ago. Chief executive Guy Konsbruck said: '"Afarak's third-quarter results reflect the annual seasonal fluctuations. 'The summer period in Europe entails a weakening in demand and a related shutdown of many plants. 'Our plant in Germany was closed for just two weeks during the quarter. In South Africa, higher winter electricity tariffs typically lead to maintenance shutdowns during the same period. 'During the quarter, we extended the closure of our plant in Mogale to 4 weeks as we wanted to perform major and necessary maintenance works. In addition to the seasonal effects, our quarter three result was negatively impacted by quite a challenging business environment in South Africa. 'Just as third-party ores saw a steep price increase, thus impacting our cost of production for some grades in Mogale, the benchmark for charge chrome dropped drastically and unexpectedly to USD 1.10, resulting in much lower margins than expected. 'During the quarter, we were also faced with unusually bad weather conditions in South Africa which created port congestions and delays in shipments. 'All these challenges negatively affected our profitability of both the ferroalloys segment and the Group. 'Nevertheless, despite all this, the third quarter EBITDA results for 2017 improved from a year earlier.' Story provided by

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