Following the release of its positive first half results, Angloplat has warned that tougher operating conditions lie ahead as the rand continues to gain strength and higher costs erode profit margins.

The company said in a statement: "If, in the second half of the year, the rand remains at current levels and US dollar metal prices remain where they are, then earnings for the second half the year are likely to be slightly lower than those of the first half."

The rand has fallen slightly this month, averaging R6.09 to the dollar compared to R6.64 over the first six months of 2004.

The world's leading platinum producer reported a 32 per cent jump in headline earnings earlier this week, fuelled by higher metals prices and relatively weak results last year.

During the first six months of the year, the average pgm basket price achieved by Angloplat totalled R7,855 ($1,183) per platinum ounce mined, which is 8.8 per cent higher than the R7,222 ($899) in 2003. The price of a platinum ounce rose by 7.4 per cent in comparison with the previous year's figure, up to R4,791.

Roland von Kerckhoven, the company's finance director, told Mineweb that the basket price peaked at R8,000 per platinum ounce mined during the first half of 2004, but is currently hovering around R7,300.

Angloplat chief executive Ralph Havenstein also explained that wage costs, which account for 50 per cent of total outgoings, increased over the period.