Exxaro Resources saw its shares rise by over 10% early on Thursday after reporting a strong increase in profit for the first half of the year. The company’s profit increased by 11% to R4.1 billion, driven by higher export and domestic sales. Its earnings per share also grew by 13% to 1,724 cents.
The company’s revenue went up by 8% to R20.6 billion, mainly thanks to its coal business. Better sales volumes and higher prices helped offset weaker commodity prices. Exxaro’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) rose by 10% to R5.6 billion, with margins staying steady at 27%.
The boost in earnings was supported by stronger EBITDA and an 18% increase in income from investments, mainly due to higher production and sales at Black Mountain Mining. Income from the Sishen Iron Ore Company remained stable. The company declared an interim dividend of R8.43 per share, marking its 45th consecutive dividend since listing on the Johannesburg Stock Exchange in 2006.
Production levels remained steady at 19.4 million tonnes, while sales increased slightly, thanks to higher demand both locally and abroad. Challenges like rail disruptions at Grootegeluk caused by heavy rains were managed by diverting product from Mpumalanga to meet customer needs.
In its efforts to reduce emissions, Exxaro signed a memorandum with Eskom in April to cut Scope 2 and 3 emissions. The company also completed the financial arrangements for the Karreebosch renewable energy project. Its wind assets in Cennergi generated 337 gigawatt-hours during the period, meeting expectations.
In addition, Exxaro entered binding agreements in May to buy stakes in several assets, including the Tshipi Borwa Mine, in a deal valued at up to R14.68 billion, pending approval. The company expects this transaction to close in the first quarter of 2026.
As of 9:50am, Exxaro’s shares were trading at R180.77, up by over 10%, reflecting investor confidence in its strong financial results and growth prospects.