South Africa’s African Rainbow Minerals (ARM) has reported a 19% increase in annual headline earnings to R3.2 billion for the year ended 30 June 2026, driven by sharply higher platinum group metal (PGM) prices. The strong performance has given the board confidence to approve the R753 million restart of the Nkomati nickel mine in Mpumalanga.
The Nkomati mine, South Africa’s only primary nickel producer, was placed on care and maintenance in 2021 due to persistent financial losses driven by rising operational costs and weak nickel prices. ARM took full control of the asset in July 2025 following the exit of its former joint venture partner, Russia’s Nornickel.
The investment case
Plant refurbishment began in July 2026, with open-pit mining scheduled to resume in October 2026. The restart targets annual production of 56,065 tonnes of nickel concentrate, with a projected payback period of 5.3 years and an internal rate of return of 28.4%.
The project is backed by a conditional offtake agreement with Swedish metals producer Boliden, signed in April 2026, which secures a route to market for the nickel concentrate. The concentrate will be shipped for processing at Boliden’s Harjavalta smelter in Finland, the only large-scale nickel smelter in Europe.
Why nickel matters
Nickel’s role in electric vehicle batteries and stainless steel makes the move more than operational-it is a strategic bet on South Africa’s position in the global energy transition supply chain. Nickel prices have risen about 20% since the end of 2025, driven in part by policy-driven production cuts in Indonesia, the world’s largest nickel producer.
ARM’s PGM operations swung back to profit with R1.35 billion in headline earnings against a R1.29 billion loss in FY2025, after metal prices rose by more than 50% compared to the previous year.
Balancing act
The profit surge and improved balance sheet have given ARM the confidence to commit new capital at a time when some analysts have expressed concerns over the timing and scale of the company’s broader investment programme. ARM shares have declined 21% this year.
The company also approved a R15.2 billion development of its Bokoni platinum project in Limpopo, with first production targeted for the first half of the 2028 financial year. The combined investment of approximately R16 billion represents one of the largest capital commitments by a South African mining company in recent years.
ARM said it will pay a final dividend of R7 per share, up from R6 per share last year
Editor: info@esgfrontiers.co.za
