Feb 19 (Reuters) – Anglo American Platinum AMSJ.J said on Monday it plans to cut thousands of jobs at its mines in South Africa after its profits plunged by 71% last year.

The Anglo American AAL.Lunit said in a statement that it is embarking on a restructuring that could affect about 3,700 jobs at its South African operations as it battles to keep the lid on costs amid falling platinum-group metals prices.

The miner is also reviewing contracts with 620 service providers, Amplats said.

The restructuring decision “has not been taken lightly” Craig Miller, the chief executive officer.

“It’s very much a last resort, not least as we recognise the unemployment challenges in South Africa and the socio-economic impact that the proposed restructuring may have on our people and the communities we are part of,” Miller said on a conference call.

The Johannesburg-based firm said its profit slumped to 14 billion rand ($741.81 million) in the year ended Dec.31 compared to 48.8 billion rand the previous year. Amplats slashed its dividend by 81%, to 21.30 rand per share.

Still, Amplats said the payout is within its ratio of 40% of headline earnings.

The prices of palladium and rhodium fell 37% and 58%

in the year, respectively. Amplats’ South African peers including Sibanye Stillwater have also announced plans to cut jobs due to the fall in metal prices.

Anglo American CEO Duncan Wanblad, told Reuters on Feb.5 that the group was considering deeper cost-cutting measures if market conditions did not improve. In December, Anglo American has announced sweeping cuts to save about $1.8 billion by 2026.

As part of the cost-cutting measures, Amplats is postponing planned projects at its Amandelbult complex, it said.

($1 = 18.8727 rand)

(Reporting by Prerna Bedi in Bengaluru and Nelson Banya in Harare; Additional reporting by Felix Njini; Editing by Savio D’Souza and Kim Coghill)