Pan African Resources


Market Cap£328m

Last Close 17p

Pan African Resources has three major producing precious metals assets in South Africa: Barberton (target output 95koz Au pa), the Barberton Tailings Retreatment Project (20koz) and Elikhulu (55koz), now incorporating the Evander Tailings Retreatment Project (10koz).

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Investment summary

Pan African (PAF) produced a forecast beating 179.6koz gold in FY20 and 201.8koz in FY21, to result in senior net debt declining by 74.2% over the course of 18 months alone. The company increased its dividend more than five-fold in FY20 and by more than our expectations in FY21, such that it is already among the top 15 yielding precious metals companies, globally. Since the year end, PAF has concluded multi-year wage agreements with both the NUM and UASA.

Y/E Jun
Revenue (US$m)
PBT (US$m)
EPS (c)
P/E (x)
P/CF (x)
2019A 218.8 65.5 37.1 1.64 14.2 7.5
2020A 274.1 115.2 80.8 3.78 6.1 6.1
2021E 369.0 157.3 122.4 4.24 5.5 3.4
2022E 340.9 170.1 144.0 5.18 4.5 2.7
Industry outlook

Prior to its results, we valued PAF at 38.76c (28.04p) per share plus the 5.08cps upside potential from the development of Mintails/Mogale and the value of 19.2m underground Witwatersrand ounces (estimated 0.22–5.24c/share). Near-term development opportunities include Egoli (ZAR2.01bn NPV and 50.1% IRR), the Evander 8 Shaft Phase 1 (ZAR126.1m NPV) & 2 projects, Mintails (ZAR849m NPV and 22% IRR), the Prince Consort shaft pillar, the Fairview sub-vertical shaft (7–10koz pa) and the Royal Sheba project (c 30koz pa).

Last updated on 20/10/2021
Content on Pan African Resources
Pan African Resources – Exceeding expectations (as usual)
Metals & mining | Update | 21 July 2021
gold flake
Pan African Resources – Record interim profitability
Metals & mining | Update | 3 March 2021
gold flake
Webinar: Pan African Resources
Metals & mining | Edison TV | 3 December 2020
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Share price graph
Balance sheet
Forecast net debt (US$m) 33.8
Forecast gearing ratio (%) 14
Price performance
Actual 7.9 3.7 (19.8)
Relative* 4.4 (1.0) (35.5)
52-week high/low 26.5p/15.1p
*% relative to local index
Key management
Keith Cousens Spencer Chairman
Cobus Loots CEO
Deon Louw FD