JSE-listed construction materials and industrial minerals company Afrimat expects to report an 85% to 90% year-on-year decrease in earnings per share (EPS) and headline earnings per share (HEPS) for the financial year ended February 28.

EPS are expected to be between 52c and 78c, compared with EPS of 520.3c reported for the 2024 financial year, while HEPS are expected to be between 56.7c and 85.1c, compared with the HEPS of 567.3c reported for the prior financial year.

Changes in the iron-ore market, given the rand value received on iron-ore exports and the volume reduction from steel producer ArcelorMittal South Africa (AMSA) in the first half of the financial year, severely impacted on Afrimat’s financial performance.

Additionally, losses from cement and weaker-than-expected performance from anthracite hindered the company’s performance.

Afrimat’s management, nevertheless, remains confident that the majority of the company's metrics have turned and bode well for a better financial result in the coming year.

Substantial work was done to ensure a strong foundation for sustainability and returned performance for the financial year to end on February 28, 2026, the company says.

Recently acquired Lafarge South Africa has successfully been integrated into Afrimat. Strong performance from the traditional aggregate quarries and ash business will ensure that the Construction Materials (Aggregates) segment achieves a better result than in the year under review.

Further, the cement operations were successfully revitalised and are now functioning at acceptable levels. Afrimat is regaining market share and the trend remains positive.

The cement kilns have benefitted from extensive maintenance and are operating efficiently and dependably, and ensuring that Afrimat can operate with backup capacity.

Meanwhile, the Industrial Minerals business has significantly recovered and is returning to its previous performance. The ongoing suspension of loadshedding and optimistic signs of economic growth bode well for this business and its customers.

In its bulk commodities segment, key achievements at Nkomati include the partial receipt of the environmental-impact assessment (EIA) for the full life-of-mine plan, and the successful relocation of power lines, graves and houses. This, along with a reorganised management structure, supports optimised openpit mining.

Underground mining operations were relocated to a safer area and, together with gains from these adjustments, Nkomati's results improved towards the end of the reporting period.

However, no anthracite products were exported in the latter half of the financial year owing to the closure of the border with Mozambique, which restricted access to the Maputo port and led to a delay in export shipments.

The border has reopened and Afrimat has secured commitments for up to 80% of the new financial year's export volume, it adds.

Afrimat also maintained export iron-ore volumes consistent with the prior financial year, and maintained a positive relationship with its marketing partner, but persistent rail inefficiencies continue to hinder performance.

Consequently, actual volumes remain 20% below its allocated rail capacity, the company notes.

International iron-ore prices have remained lower than last year's comparative period and local iron-ore volumes suffered a 70% decrease in the first quarter of the financial year owing to significantly reduced volumes taken up by AMSA.

Volumes recovered well for part of the second quarter of the year and continued across the second half of the financial year under review.

Afrimat remains in active discussions with AMSA to supply it with innovative raw material solutions to support the steelmaker’s long-term sustainability, the company adds.

In its future materials and metals business segment, the testwork on the rare earths component is nearing completion and showing positive results. Afrimat is perusing the final design of the process to ensure it capitalises on the inherent competitive advantage of the Glenover resource.

On the phosphate side of this segment, the plant is operational with ramp-up progressing well, although slower than projected.

Looking ahead, the successful integration of Lafarge has strengthened Afrimat's already strong foundation, the company says.

Management's focus on consistently delivering, guided by a strong leadership focus, remains central to all strategic initiatives. These initiatives are designed to ensure that the 2026 financial year delivers to expectations.

Further, with the expanded EIA in place, flexible mining at Nkomati will make a meaningful difference, supported by the strategic changes that have been implemented.

Additionally, the construction materials segment is benefitting from strong aggregates performance and encouraging margin recovery while steadily reducing cement losses, Afrimat says, noting that it looks forward to better financial results in the current year.