S.Africa's Northam expects lower profit on costs, weaker metal prices

(Reuters) - South Africa's Northam Platinum on Monday said it expects its annual profit to decline by as much as 12.5% despite increased production due to higher costs and weaker metal prices.

Northam expects headline earnings per share (HEPS) - the most common profit measure in South Africa - of between 22.84 and 25.46 rand ($1.20-$1.34) for the year ended June 30, down from 26.11 rand last year.

The platinum group metal (PGM) miner's refined production increased 13% to 809,775 ounces.

The higher output and weaker rand helped push Northam's sales revenue up 16.1%.

However, cash costs per refined ounce increased 12.6%, while the U.S. dollar basket price for Northam's four PGMs was down 20% compared to last year.

Northam unsuccessfully tried to acquire Royal Bafokeng Platinum as it sought to add its smaller peer's shallow, high quality PGM assets to its portfolio, triggering a lengthy takeover battle eventually won by larger rival Impala Platinum .

Northam will release its annual results on Aug. 25.

($1 = 19.0254 rand)

(Reporting by Nelson Banya; editing by Jason Neely)