Pan African Resources


Market Cap£495m

Last Close 22.25p

Pan African Resources has four major producing precious metals assets in South Africa: Barberton (target output 95koz Au pa), the Barberton Tailings Retreatment Project, or BTRP (20koz), Elikhulu (55koz) and Evander underground, incorporating Egoli (currently 36koz, rising to >100koz).

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Investment summary

Pan African (PAF) produced a forecast beating 108.1koz gold in H122 (cf 201.8koz in FY21 and 179.6koz in FY20), to result in an upgrade to its FY22 production guidance (from 195koz to 200koz) and net senior debt declining by US$36.0m (or 60.1%) to just US$23.9m over the past 12 months alone.

Y/E Jun
Revenue (US$m)
PBT (US$m)
EPS (c)
P/E (x)
P/CF (x)
2020A 274.1 115.2 80.8 3.78 7.5 7.5
2021A 368.9 156.6 117.7 4.54 6.2 4.4
2022E 374.2 167.2 133.9 5.18 5.5 3.5
2023E 359.5 174.7 138.3 4.91 5.8 3.3
Industry outlook

In the wake of H122 results, our core valuation of PAF is 33.79c/share (25.65p/share), based on projects either sanctioned or already in production. However, this rises by a further 15.07–20.09c (11.44–15.25p) once other assets (eg Mintails/Mogale, Egoli etc) are also taken into account. Alternatively, if PAF’s historical average price to normalised EPS ratio of 8.9x is applied to our FY22 and FY23 forecasts, it implies a share price of 34.83p in FY22, followed by 33.00p in FY23. In the meantime, it remains cheaper than its London and JSE-listed peers on at least 69% of commonly used valuation measures and remains among the top 15 yielding precious metals companies globally.

Last updated on 24/05/2022
Content on Pan African Resources
Pan African Resources – Quietly getting the job done in South Africa
Metals & mining | research Update | 8 April 2022
gold flake
Pan African Resources – Everything falling into place
Metals & mining | research Outlook | 28 October 2021
gold flake
Pan African Resources – Exceeding expectations (as usual)
Metals & mining | research Update | 21 July 2021
gold flake
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Share price graph
Balance sheet
Forecast net cash (US$m) 15.5
Forecast gearing ratio (%) N/A
Price performance
Actual 2.3 (1.6) 13.3
Relative* 3.6 (4.2) 10.4
52-week high/low 24.0p/15.1p
*% relative to local index
Key management
Keith Cousens Spencer Chairman
Cobus Loots CEO
Deon Louw FD