In a challenging period for the platinum group metals (PGM) industry, Impala Platinum’s Zimbabwean unit, Zimplats, alongside Sibanye-Stillwater’s jointly owned Mimosa mine, are implementing workforce reductions in Zimbabwe. This development echoes a trend of retrenchments within the PGM sector in South Africa, prompted by a persistent downturn in platinum prices.
Zimplats has introduced a voluntary retrenchment scheme for its employees, aiming to align its operational costs with the current market realities. Similarly, Mimosa mine has proceeded to retrench management-level staff, both actions reflecting broader efforts within the industry to navigate subdued platinum prices effectively.
Alex Mhembere, CEO of Zimplats, communicated to the workforce that the voluntary retrenchment plan is part of a broader strategy focusing on cost containment and cash preservation, amidst a challenging operational landscape. Employees opting for this scheme are offered two weeks’ pay for every year of service, alongside a one-month notice pay, with a guarantee of a minimum three-month package for those whose entitlements fall below this threshold.
The decision comes in the wake of Zimplats reporting a significant downturn in its financial performance, attributed to softening metal prices. For the half-year ending in December, Zimplats witnessed a 32% decline in revenue to $372.8 million, resulting in a 94% decrease in pre-tax profits to $14.2 million, and ultimately swinging to a post-tax loss of $8.8 million from a profit of $159.6 million in the same period the previous year.
The impact of declining commodity prices has necessitated a reevaluation of operations, with management exploring various strategies to mitigate losses, including workforce adjustments. The industry’s outlook remains cautious, with expectations of continued price depression in the medium term, prompting companies to implement measures ensuring viability under these conditions.
Mimosa mine, in an effort to conserve cash, has also undertaken a staff rationalisation exercise affecting 33 managerial and supervisory roles. Additionally, a significant investment plan aimed at developing the new North Hill project has been paused, highlighting the industry’s cautious stance amid uncertain market dynamics. 
