According to a trading update published on Moneyweb on 7 October 2026, Afrimat Limited said it expects a headline loss per share (Hlps) of between 60 cents and 55 cents for the six months to 31 August 2026. The figure contrasts with headline earnings per share (Heps) of 101.9 cents reported in the same period a year earlier.
Headline loss per share (Hlps) is the loss per share before one-off items, while headline earnings per share (Heps) is profit per share before one-off items. The company also projected earnings per share (EPS) to fall by roughly 95% to 100%, landing between 0.1 and 5.2 cents, down from 102.7 cents previously.
Why the drop matters
Afrimat attributes the swing to three main factors: a stronger rand that squeezes export revenues, a 49.1% rise in shipping costs linked to disruptions from the Iran conflict, and a sharp fall in iron ore demand. The stronger rand and higher freight costs reduced average mine-gate revenue per ton by 16.4%.
Domestic iron ore sales were also hit. A key customer drew on stockpiles held outside Afrimat, leading to lower and irregular volumes. Even after a modest recovery in the second quarter, total domestic sales remained 36.5% below the comparative period.
Aggregates and fly ash provide a cushion
In contrast, Afrimat’s aggregates and fly ash businesses delivered margin expansion and strong operating profit growth. The group said the performance validates its earlier acquisition of the Lafarge quarries. Between FY2022 and FY2026, operating profit in these units grew at a compound annual growth rate of 36.3%, reaching an operating profit margin of 18% in FY2026.
The cement operation, however, continued to generate an operating loss despite significant investment in engineering and equipment.
Balance-sheet actions
To protect cash flow, Afrimat has been deleveraging by selling non-core brick-and-block businesses, completing Competition Commission-mandated divestitures, and liquidating surplus iron ore stockpiles. These actions have lowered the debt-to-equity ratio to below 50%, with a target of around 25%.
The full interim results are scheduled for release on or about 22 October 2026. For more coverage of similar market updates, see the Markets & Finance section.
The gap between earnings per share and headline loss per share stems from profits recognised on Competition Commission-mandated divestitures and the sale of non-core assets, a nuance not reflected in the headline loss figure. Those one-off gains offset part of the operating deficit, narrowing the EPS range to between 0.1 and 5.2 cents despite the broader loss of 55-60 cents per share. This distinction highlights how regulatory-driven disposals can temporarily bolster profitability metrics even when core operations remain under pressure.
During the first quarter, temporary shutdowns at ferrochrome smelters reduced demand for anthracite, further denting Afrimat’s bulk commodities performance. The loss of this downstream market contributed to the overall decline in iron ore profitability, compounding the effects of weaker export prices and higher freight costs. While the shutdowns were brief, their impact on anthracite sales was felt across the reporting period, adding another layer to the earnings contraction.
Efficiency initiatives, targeted marketing efforts and strong client retention have been credited with the robust performance of the aggregates and fly ash businesses. By streamlining processes and maintaining high service levels, the group achieved margin expansion and sustained operating profit growth, reinforcing the strategic rationale behind the Lafarge quarry acquisition. These operational improvements helped offset some of the headwinds affecting other divisions.
The cement operation continued to generate an operating loss throughout the early part of the period, despite significant investments in engineering, management capacity and equipment repairs. Those capital outlays have not yet translated into profitability, indicating that the turnaround may require a longer horizon or additional cost-control measures before the division can contribute positively to the group’s bottom line.
Looking ahead, Afrimat is expanding production capacity across its minerals portfolio, a move aimed at positioning the company for future demand recovery. The expansion plan includes scaling up output at existing sites and developing new projects, thereby increasing the overall volume of sellable material once market conditions improve.
Interim results are filed in accordance with JSE requirements, with the full set of financial statements due on or about 22 October 2026. Once released, the results will be reviewed by analysts, and the company will hold an earnings conference call to discuss the figures. Any subsequent adjustments to guidance or dividend policy will be communicated through a formal announcement to shareholders and the market.
