AFRICAN Rainbow Minerals (ARM) on Friday told shareholders it was committed to paying dividends, even as the company battles weak commodity markets.

ARM declared a dividend of R3.50 per share for the year ended June 2015, down from the R6 declared in the year-earlier period. This is the ninth consecutive year that the company has paid a dividend.

Headline earnings per share fell to R8.03 from R19 at the end of the 2014 financial year.

ARM said the reduction in headline earnings was largely as a result of a decline in average realised dollar prices for iron ore, manganese ore, platinum, nickel, export thermal coal and copper.

“In the financial year under review, average realised US dollar iron ore prices declined by approximately 42% due to increased supply from the major global producers coupled with a slowdown in iron ore demand (especially from China).

“The low commodity price environment is expected to persist for the foreseeable future. A key focus for ARM in the past financial year has therefore been to optimise revenue and rigorously reduce operating costs and capital expenditure without compromising the long-term sustainability of each operation,” the company said.

ARM said sales for the year ended June 2015 were down 7% to R9.26bn compared with the year-earlier period.

It said capital expenditure for the year was R400m more than in 2014 at R3.3bn, mainly as a result of increased waste stripping costs at Nkomati Mine and expenditure on upgrading infrastructure at the Black Rock and Modikwa operations.

Looking ahead, ARM said it would continue to review all operations with a view to improve profitability and cash flow in the challenging commodity environment.

“In particular, capital expenditure is to be curtailed as far as possible without negatively impacting on the sustainability of operations”.

ARM said the current oversupply of certain commodities was expected to be addressed by the normal market supply-demand responses over the next two to three years.

“ARM is positive about a future recovery in commodity prices and therefore believes that all steps taken now to improve productivity, unit costs and profitability will position the company well in the future,” the company said.

In the past year, shares in the company have declined by 61%. This time last year, an ARM share was valued at about R178.71.

On the JSE on Thursday, shares closed at R65.70, valuing the company at about R14bn.