Pan African Resources


Market Cap£374m

Last Close 16.82p

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 Resources (PAF) produced a forecast – and guidance – beating 205koz gold in FY22 (cf 202koz in FY21 and 180koz in FY20) to result in net senior debt declining by US$24m (or 72%) to just US$10m over the course of the year. It has also recently completed a definitive feasibility study on its potential Mogale acquisition, showing c 50koz pa production over 13 years to generate an NPV to investors of US$64.9m (or 3.3c or 2.8p per share).

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 5.1 5.0
2021A 368.9 156.6 117.7 4.54 4.2 3.0
2022E 371.9 167.6 134.4 5.20 3.7 2.4
2023E 365.3 191.0 157.9 5.54 3.5 2.1
Industry outlook

Our core valuation of PAF is 44.67c/share (37.18p/share), based on projects either already in production or sanctioned. However, this rises by a further 15.67–20.69c (13.04–17.22p) once other assets (eg Egoli) 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 37.83p in FY22 and 40.78p in FY23. In the meantime, it is cheaper than its peers on 69% of valuation measures and remains among the top 15 yielding precious metals companies globally.

Last updated on 28/09/2022
Content on Pan African Resources
Pan African Resources – Building steam
Metals & mining | research Update | 7 July 2022
gold flake
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
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Share price graph
Balance sheet
Forecast net debt (US$m) 3.3
Forecast gearing ratio (%) 1
Price performance
Actual (15.9) (14.7) 7.4
Relative* (10.3) (9.9) 13.5
52-week high/low 24.0p/15.1p
*% relative to local index
Key management
Keith Cousens Spencer Chairman
Cobus Loots CEO
Deon Louw FD