Steel boom boosts Iscor's profits

Iscor is in line for a name change

Shares in South African steel producer Iscor surged to a record high on Wednesday after the firm reported strong interim profits.

Revenue for the six months to June rose 13% to 10.54bn rand ($1.6bn, £884m). Operating profit, which strips out debt payments, was up 31% to 2.2bn rand.

Iscor unveiled plans to return up to 5.8bn rand in cash to shareholders.

Meanwhile, the firm has ended a year-long dispute with its largest union, preventing a possible strike.

On the Johannesburg Stock Exchange, Iscor shares - which have risen 50% this year - were up 4% to 45.50 rand.

Domestic sales surge

Profits at Africa's biggest steel producer were boosted by strong steel prices and a 22% surge in domestic sales, which bring in more money than exports.

Additional cost savings were achieved with the help of Anglo-Dutch firm LNM Holdings, which has taken a controlling stake in the firm.

The firm's balance sheet showed a rise in net cash to 1.37bn rand from 27m rand at the end of last year.

Also on Wednesday, Iscor reached a deal with the Solidarity Union, which accepted an annual wage increase of up to 8.5%.

The agreement ends a year-old dispute and wards off potential strike action.

Two other unions, the National Union of Metalworkers of South Africa and the United Association of South Africa, had already accepted the offer.

Iscor is to be renamed Ispat Iscor next month, based on LNM's global brand.