Bloomberg News

Kumba Iron Ore Falls as Profit Forecast Misses Estimates

July 06, 2012

Kumba Iron Ore Ltd. (KIO) fell the most in two weeks in Johannesburg trading after the Anglo American Plc (AAL) unit said first-half earnings will probably fall by more than analysts estimated.

The stock declined 3.5 percent to 559.50 rand at the 5 p.m. close, the biggest drop since June 22.

Earnings excluding one-time items are likely to be 7.1 billion rand ($864 million), or 22.10 rand a share, to 7.5 billion rand, or 23.40 rand, Kumba said in a statement today. Earnings on that basis were 28.23 rand a share a year earlier. The median estimate of four analysts surveyed by Bloomberg is for 23.84 rand.

“The decrease in earnings is largely attributable to a decrease in export iron ore prices in the period,” the Johannesburg-based company said. Iron ore is used to make steel. Detailed earnings will be released on July 20, it said.

The price of iron-ore fines imported through Tianjin port into China, the largest steel-making nation, fell 21 percent to an average of $140.41 a metric ton this year from $176.63 a year earlier, according to The Steel Index Ltd. data on Bloomberg.

To contact the reporter on this story: Carli Cooke in Johannesburg at clourens@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net


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