The SA Mint made less money from making money last year, but still made lots of money
- Despite disruptions brought on by the pandemic, the SA Mint managed to produce the Reserve Bank's full order of 811 million coins in its 2020/21 financial year.
- Although its earnings dropped to R133 million, it was against a budget of R97 million.
- During the period, the coin maker de-prioritised its key business, bullion coin manufacturing, which it sells to both the domestic and international markets.
- It was further hit by weak demand locally, a key driver of growth in previous years.
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The SA Mint, a wholly owned subsidiary of the South African Reserve Bank (SARB), saw a reduced profit before tax last year – but still made R672 million from making money.
The company managed to produce the central bank's full order of 811 million coins, but saw pre-tax profits plummet from a previous R2.2 billion, in the year to the end of March.
The SA Mint makes its money from manufacturing the country's legal-tender coins, and collectible gold and silver coins. Through its joint venture with Rand Refinery Proprietary Limited, SA Mint also produces and sells bullion Krugerrand coins for domestic and international markets.
The company said it managed to maintain a healthy buffer stock of coins even in the face of workforce capacity constraints and supply chain challenges which were brought on by the pandemic.
These put a strain on the delivery of coins abroad and resulted in a force majeure and reduced revenues.
The collectable coins business, which was active for only eight months of the year, reached record sales, helped by export sales and the launch of the Leopard and Buffalo collectable coins in the Big Five series. The company also made the decision to de-prioritise manufacturing bullion coins due to weak demand locally. Bullion coins have been a key driver of performance in previous years. It also delayed the launch of a 24-carat gold bullion coin during the period.
The South African Bank Note Company, also a subsidiary of the Reserve Bank that produces banknotes, made a profit of R100 million, and was affected by lower banknote sales volumes.
Despite the constraints brought on by the lockdown, it delivered 892 million notes out of the 974 million it produced. Profit before tax dropped to R84 million from a prior R147 million, earnings before tax also decreased to R153 million from a previous R189 million.
During the period, the Bank Note Company saw a significant decline in fake money brought on by the pandemic as people changed methods of transactions.
The bank, which measured the incidence of counterfeit money at 5.68 parts per million, recorded it at 10.76 part per million during the year, representing a decline of 47% in the incidence of counterfeit money.
(Compiled by Ntando Thukwana)
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