Exxaro Resources capital expenditure for the first half period to the end of June, is expected to narrow down by 33 to R1.1 billion, with production and sales volumes for the period also likely to plunge by 14 and 12, respectively.
Exxaro finance director, Riaan Koppeschaar, yesterday attributed the decline in capex for the period to lower capital spending allocation at the companys coal operations.
The coal businesss capex is expected to decrease by 33, mainly due to the timing of the equipment replacement strategy and the license to operate projects at Grootegeluk and the Mpumalanga mines, said Koppeschaar.
Despite noting relative stability in the South African market, Exxaro experienced challenges with offtake from Eskom and rail underperformance.
It said the first quarter of the current year remained challenging regarding offtake from Eskoms power stations in the Waterberg region although improvements were observed in the second quarter of the period under review.
