Pan African Resources — Hitting expectations

Pan African Resources (AIM: PAF)

Last close As at 12/12/2024

GBP0.37

−0.95 (−2.47%)

Market capitalisation

GBP780m

More on this equity

Research: Metals & Mining

Pan African Resources — Hitting expectations

On 29 July, Pan African Resources (PAF) announced it had produced 186,039oz gold in FY24 at an all-in sustaining cost (AISC) of US$1,350/oz. This was within the previously guided range of 186–190koz at an AISC of US$1,325–1,350/oz and was 212oz (0.1%) above our expectation of 185,827oz. Production guidance for FY25 was reiterated at 215–225koz (cf Edison’s unchanged and relatively conservative forecast of 216.6koz). Our financial forecasts for FY24 remain little changed as a result of PAF’s announcement. However, we have increased our forecasts for FY25 to reflect the gold price remaining high into H2 CY24.

Lord Ashbourne

Written by

Lord Ashbourne

Director of Content, Mining

Metals & Mining

Pan African Resources

Hitting expectations

FY24 production outcome

Metals and mining

31 July 2024

Price

28.15p

Market cap

£539m

ZAR23.5894/£, ZAR18.3996/US$, US$1.2833/£

Net debt (US$m) at end-December 2023

61.7

Shares in issue

(effective 1,916.5m postconsolidation, excluding treasury)

2,222.9m

Free float

85%

Code

PAF

Primary exchanges

AIM/JSE

Secondary exchanges

Level 1 ADR, OTCQX Best Market and A2X

Share price performance

%

1m

3m

12m

Abs

9.2

52.6

48.6

Rel (local)

1.7

40.0

36.5

52-week high/low

26.3p

12.0p

Business description

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 30koz, rising to >100koz).

Next events

FY24 results

11 September 2024

AGM

November 2024

Ex-dividend date

November 2024

FY24 dividend payment

December 2024

Analyst

Lord Ashbourne

+44 (0)20 3077 5700

Pan African Resources is a research client of Edison Investment Research Limited

On 29 July, Pan African Resources (PAF) announced it had produced 186,039oz gold in FY24 at an all-in sustaining cost (AISC) of US$1,350/oz. This was within the previously guided range of 186–190koz at an AISC of US$1,325–1,350/oz and was 212oz (0.1%) above our expectation of 185,827oz. Production guidance for FY25 was reiterated at 215–225koz (cf Edison’s unchanged and relatively conservative forecast of 216.6koz). Our financial forecasts for FY24 remain little changed as a result of PAF’s announcement. However, we have increased our forecasts for FY25 to reflect the gold price remaining high into H2 CY24.

Year
end

Revenue
(US$m)

PBT*
(US$m)

EPS*
(c)

DPS
(c)

P/E
(x)

Yield
(%)

06/22

376.4

117.2

4.44

1.04

8.1

2.9

06/23

321.6

92.9

3.54

0.95

10.2

2.6

06/24e

390.7

142.0

5.72

0.98

6.3

2.7

06/25e

473.9

211.4

8.02

0.98

4.5

2.7

Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles and exceptional items.

MTR ahead on time and budget

All operations outperformed our prior expectations except for Evander, which experienced a delay in commissioning the ventilation shaft for hoisting at eight shaft underground operations. In addition to its production and cost numbers, PAF also reported that ‘exceptional progress’ had been made in the construction of its new Mogale Tailings Retreatment (MTR) project, which is nearing its final stages within budget and ahead of schedule. Plant commissioning and first gold production is now anticipated ahead of schedule in October 2024, with steady state production in December 2024.

Valuation: Trending higher

Given our updated forecasts, our core (absolute) valuation of Pan African has increased from 48.08c per share to 48.41c per share (37.72p), based on projects either sanctioned or already in production. This valuation rises by a further 22.35–27.37c if other assets (eg Egoli and the Soweto cluster) are also taken into account. Alternatively, if PAF’s historical average price to normalised headline earnings per share (HEPS) ratio of 8.4x in the period FY10–23 is applied to our FY24 and FY25 forecasts, it implies a value of 37.41p in FY24, followed by 52.43p in FY25. As such, PAF’s current share price of 28.15p could be interpreted as discounting normalised HEPS falling to 4.31c per share (cf our forecasts of 5.72c/share for FY24 and 8.02c/share for FY25). In the meantime, PAF remains cheaper than its principal London- and South African-listed gold mining peers on at least 69% of commonly used valuation measures, regardless of whether they are based on Edison or consensus forecasts. Performing a relative valuation analysis, its peers imply a comparable valuation for PAF of 52.31p based on our year one EPS estimate and one of 48.49p based on our year two EPS estimate. Separately, we estimate that PAF has the 24th highest dividend yield of the 61 precious metals mining companies expected to pay dividends to shareholders over the next 12 months (globally). Finally, we calculate that PAF is trading at an enterprise value that equates to just US$19.72 per resource ounce of gold.

Updated FY24 financial forecasts

Pan African’s group production for FY24 was very close to our prior expectation, albeit reflecting general outperformance at its Barberton operations and Elikhulu and underperformance at Evander, where a delay in commissioning the ventilation shaft for hoisting at eight shaft underground operations adversely affected production in May and June.

Exhibit 1: Pan African production, H121–FY25e (oz)

Operation

H121

H221

H122

H222

H123

H223

H124

H224e

(prior)

H224e

(current)

Variance

(%)

Variance

(oz)

FY24e

(current)

FY25e

Barberton UG

42,350

42,476

39,991

35,747

32,022

32,564

36,780

33,175

34,690

+4.6

+1,515

71,470

79,235

BTRP

10,004

8,235

9,126

10,434

10,012

9,863

9,864

8,500

9,024

+6.2

+524

18,888

10,000

Barberton

52,354

50,711

49,117

46,181

42,034

42,427

46,644

41,675

43,714

+4.9

+2,039

90,358

89,235

Evander UG

12,607

23,409

27,312

21,538

19,173

10,359

21,307

19,693

17,161

-12.9

-2,532

38,468

53,196

Evander surface

6,560

4,677

5,756

3,564

5,270

5,373

2,401

99

0

-100.0

-99

2,401

0

Evander

19,169

28,086

33,068

25,102

24,443

15,732

23,708

19,792

17,161

-13.3

-2,631

40,869

53,196

Elikhulu

26,863

24,596

25,900

26,320

25,830

24,743

28,106

25,902

26,706

+3.1

+804

54,812

48,219

MTR

25,956

Total

98,386

103,391

108,085

97,603

92,307

82,902

98,458

87,369

87,581

+0.2

+212

186,039

216,606

Source: Edison Investment Research, Pan African Resources. Note: Totals may not add up owing to rounding. UG, underground. BTRP, Barberton Tailings Retreatment Project.

The resulting effect on our financial forecasts for FY24 was, therefore, minimal, as shown in Exhibit 2, below:

Exhibit 2: Pan African P&L statement by half year (H122–H224e)

US$000s*

H122

H222

H123

H223

H124

H224e

(prior)

H224e

(current)

Variance

(%)

FY24e

(current)

FY24e

(prior)

Revenue

193,574

182,797

156,489

165,117

193,947

196,376

196,763

0.2

390,710

390,323

Cost of production

(108,368)

(118,077)

(99,282)

(99,508)

(110,292)

(98,695)

(98,789)

0.1

(209,081)

(208,987)

Depreciation

(13,268)

(13,160)

(11,122)

(9,277)

(10,768)

(11,146)

(11,144)

0.0

(21,912)

(21,914)

Mining profit

71,938

51,560

46,085

56,332

72,887

86,535

86,831

0.3

159,718

159,422

Other income/(expenses)

(7,711)

(2,117)

(3,610)

(3,737)

(7,231)

(23,720)

(22,474)

(5.3)

(29,705)

(30,951)

Loss in associate etc

0

0

0

0

0

0

0

N/A

0

0

Loss on disposals

0

0

0

0

0

0

0

N/A

0

0

Impairments

0

(467)

0

0

0

0

0

N/A

0

0

Royalty costs

(1,316)

(780)

(468)

(495)

(1,242)

(2,460)

(2,465)

0.2

(3,707)

(3,702)

Net income before finance

62,910

48,197

42,007

52,100

64,414

60,354

61,891

2.5

126,305

124,768

Finance income

661

434

456

683

760

N/A

Finance costs

(1,945)

(3,381)

(3,464)

(6,228)

(5,594)

N/A

Net finance income

(1,285)

(2,946)

(3,008)

(5,545)

(4,834)

(9,201)

(9,201)

0.0

(14,035)

(14,035)

Profit before taxation

61,626

45,250

38,999

46,555

59,580

51,154

52,691

3.0

112,271

110,734

Taxation

(15,573)

(16,351)

(10,063)

(14,754)

(17,223)

(14,845)

(15,297)

3.0

(32,520)

(32,068)

Effective tax rate (%)

25.3

36.1

25.8

31.7

28.9

29.0

29.0

0.0

29.0

29.0

PAT (continuing ops)

46,053

28,899

28,936

31,801

42,357

36,309

37,393

3.0

79,750

78,666

Minority interest

(185)

(136)

(266)

(224)

0

0

N/A

(224)

(224)

Ditto (%)

(0.6)

(0.5)

(0.8)

(0.5)

0.0

0.0

N/A

(0.3)

(0.3)

Attributable profit

29,084

29,072

32,067

42,581

36,309

37,393

3.0

79,974

78,890

 

 

Headline earnings

46,053

29,551

29,072

31,392

42,581

36,309

37,393

3.0

79,974

78,890

Est normalised headline earnings

53,764.1

31,668

32,682

35,129

49,812

60,029

59,867

(0.3)

109,679

109,841

 

 

 

EPS (c)

2.39

1.51

1.52

1.67

2.22

1.89

1.95

3.2

4.17

4.12

HEPS** (c)

2.39

1.54

1.52

1.63

2.22

1.89

1.95

3.2

4.17

4.12

Normalised HEPS (c)

2.79

1.65

1.71

1.83

2.60

3.13

3.12

(0.3)

5.72

5.73

Source: Pan African Resources, Edison Investment Research. Note: As reported basis. *Unless otherwise indicated. **HEPS, headline earnings per share (South African company adjusted basis).

Net debt was reported to be US$106.4m, which was slightly above our prior forecast of US$93.8m, but included an additional US$9.9m capex during the year for the group’s solar power initiative at Fairview, which is not typically included in our models.

Group production

In the wake of the company’s FY24 production and cost update, our longer-term forecasts remain unchanged, with output expected to break the 250ktpa barrier in FY26, driving normalised HEPS beyond 6.00c per share and potentially as high as 9.00c per share (see Exhibit 4).

Exhibit 3: Estimated Pan African group gold production profile, FY18–FY29e

Source: Edison Investment Research, Pan African Resources

Updated (absolute) valuation

In the light of PAF’s announcement, our absolute valuation of the company (based on its existing four producing assets plus the 25 and 26 Level project and Mogale) has increased from 48.08c previously to 48.41c, based on the present value of the estimated maximum potential stream of dividends payable to shareholders over the life of its mining operations (applying a 10% discount rate).

Exhibit 4: Pan African estimated life of operations’ EPS and (maximum potential*) DPS

Source: Pan African Resources, Edison Investment Research. Note: Excludes discretionary exploration investment. *From FY26.

Including its other growth projects and assets, our updated total valuation of PAF is as follows:

Exhibit 5: Pan African absolute valuation summary

Project

Current valuation
(USc/share)

Previous valuation
(USc/share)

Existing producing assets (including 24 Level and 25 & 26 Level and Mogale projects)

48.41

48.08

Cum-FY24 dividend

0.98

0.99

Royal Sheba*

0.98

0.93

Other

1.70

1.61

Sub-total

52.07

51.61

EGM underground resource

0.22–5.24

0.22–5.24

Sub-total

52.29–57.31

51.83–56.85

Egoli

16.98

16.94

Soweto cluster

1.49

1.48

Total

70.76–75.78

70.25–75.27

Source: Edison Investment Research. Note: Numbers may not add up owing to rounding. *Resource based valuation.

Historical relative and current peer group valuation

Historical relative valuation

Exhibit 6 depicts PAF’s average share price in each of its financial years from FY10 to FY23 and compares this with HEPS in the same year. For FY24e and FY25e, the current share price (28.15p) is compared with our forecast normalised HEPS for those years. PAF’s price to normalised HEPS ratios of 6.3x and 4.5x for FY24 and FY25, respectively (based on our forecasts, see Exhibits 2 and 8) remain firmly towards the bottom of the range of recent historical P/E ratios of 4.1x (in FY20) to 14.8x (in FY15) for the period FY10–23.

Exhibit 6: Pan African historical price to normalised HEPS** ratio, FY10–FY25e

Source: Edison Investment Research, Pan African Resources. Note: *Completed historical years calculated with respect to average share price within the year shown and normalised HEPS; zero normalisation assumed before 2016. **HEPS shown in pence prior to 2018 and US cents thereafter.

If PAF’s average year one price to normalised EPS ratio of 8.4x for the period FY10–23 is applied to our normalised earnings forecasts, it implies a share price for PAF of 37.41p in FY24 (cf 38.30p previously), followed by one of 52.43p in FY25 (cf 41.94p previously). Stated alternatively, PAF’s current share price of 28.15p, at prevailing forex rates, appears to be discounting FY24 and/or FY25 normalised HEPS of 4.31c per share (cf 3.54c reported in FY23 and 5.72c and 8.02c forecast in FY24 and FY25, respectively).

Relative peer group valuation

It may be seen that PAF remains cheaper than its London- and South Africanlisted gold mining peers on at least 72% of comparable common valuation measures (26 out of 36 individual measures in the table below) on the basis of Edison’s forecasts or 69% (25 out of 26 individual measures) on the basis of consensus forecasts:

Exhibit 7: Comparative valuation of Pan African with South African and London peers

Company

EV/EBITDA (x)

P/E (x)

Yield (%)

Year 1

Year 2

Year 1

Year 2

Year 1

Year 2

AngloGold Ashanti

5.3

4.7

10.9

9.3

1.6

1.8

Gold Fields

5.4

4.1

12.5

8.0

3.3

4.8

Sibanye Stillwater

3.5

2.8

16.8

5.8

0.0

0.0

Harmony

5.2

4.0

9.4

7.0

1.6

2.6

Centamin

2.8

2.3

8.7

7.5

3.3

7.1

Endeavour Mining

4.5

3.8

11.0

8.3

3.9

4.6

Average (excluding PAF)

4.4

3.6

11.6

7.6

2.3

3.5

PAF (Edison)

4.2

2.9

6.3

4.5

2.7

2.7

PAF (consensus)

4.8

3.4

8.4

5.7

2.7

4.2

Source: Edison Investment Research, LSEG Data & Analytics. Note: Consensus and peers priced on 29 July 2024.

Stated alternatively, applying PAF’s peers’ average year one P/E ratio of 11.6x to our forecast normalised HEPS forecast of 5.72c per share for FY24 implies a share price for the company of 52.31p at prevailing forex rates. Applying its peers’ average year two P/E ratio of 7.6x to our forecast normalised HEPS forecast of 8.02c per share (cf 6.28c previously) implies a share price of 48.49p.

Exhibit 8: Financial summary

US$'000s

2022

2023

2024e

2025e

Year end 30 June

IFRS

IFRS

IFRS

IFRS

PROFIT & LOSS

Revenue

 

 

376,371

321,606

390,710

473,855

Cost of sales

(226,445)

(198,790)

(209,081)

(210,791)

Gross profit

149,926

122,816

181,630

263,064

EBITDA

 

 

147,830

121,853

177,922

256,969

Operating profit (before amort. and excepts.)

 

 

121,402

101,454

156,010

221,002

Intangible amortisation

0

0

0

0

Exceptionals

(10,295)

(7,347)

(29,705)

(22,612)

Other

0

0

0

0

Operating profit

111,107

94,107

126,305

198,390

Net interest

(4,231)

(8,553)

(14,035)

(9,576)

Profit Before Tax (norm)

 

 

117,171

92,901

141,975

211,426

Profit before tax (FRS 3)

 

 

106,876

85,554

112,271

188,814

Tax

(31,924)

(24,817)

(32,520)

(57,726)

Profit after tax (norm)

85,247

68,084

109,455

153,700

Profit after tax (FRS 3)

74,952

60,737

79,750

131,088

Average Number of Shares Outstanding (m)*

1,926.1

1,916.5

1,916.5

1,916.5

EPS - normalised (c)

 

 

4.44

3.54

5.72

8.02

EPS - FRS 3 (c)

 

 

3.90

3.19

4.17

6.84

Dividend per share (c)

1.04

0.95

0.98

0.98

Gross margin (%)

39.8

38.2

46.5

55.5

EBITDA margin (%)

39.3

37.9

45.5

54.2

Operating margin (before GW and except.) (%)

32.3

31.5

39.9

46.6

BALANCE SHEET

Fixed assets

 

 

401,139

439,676

585,050

620,390

Intangible assets

44,210

44,429

46,633

48,856

Tangible assets

355,802

395,247

538,417

571,534

Investments

1,127

0

0

0

Current assets

 

 

55,953

61,263

42,598

135,822

Stocks

9,977

9,567

13,024

15,806

Debtors

17,546

15,182

27,831

33,778

Cash

26,993

34,771

0

84,495

Current liabilities

 

 

(58,989)

(77,386)

(97,583)

(119,397)

Creditors

(57,117)

(65,884)

(80,827)

(112,346)

Short-term borrowings

(1,872)

(11,502)

(16,756)

(7,052)

Long-term liabilities

 

 

(103,494)

(128,957)

(174,468)

(168,878)

Long-term borrowings

(37,088)

(45,334)

(89,644)

(82,390)

Other long-term liabilities

(66,406)

(83,623)

(84,824)

(86,488)

Net assets

 

 

294,609

294,596

355,598

467,937

CASH FLOW

Operating Cash Flow

 

 

142,879

132,941

111,738

218,721

Net Interest

(2,794)

(5,121)

(14,035)

(9,576)

Tax

(8,520)

(7,722)

(4,242)

(24,890)

Capex

(81,951)

(109,952)

(167,286)

(71,307)

Acquisitions/disposals

563

(2,779)

0

0

Financing

(3,222)

0

(0)

0

Dividends

(21,559)

(19,975)

(21,200)

(18,749)

Net cash flow

25,396

(12,608)

(95,025)

94,199

Opening net debt/(cash)

 

 

23,553

11,967

22,065

106,400

Exchange rate movements

(4,401)

(4,481)

0

0

Other

(9,409)

6,991

10,690

7,254

Closing net debt/(cash)

 

 

11,967

22,065

106,400

4,947

Source: Edison Investment Research, company accounts. Note: *2,222.9m shares in issue, of which 306.4m held in treasury, such that a net 1,916.5m are in issue post-consolidation.


General disclaimer and copyright

This report has been commissioned by Pan African Resources and prepared and issued by Edison, in consideration of a fee payable by Pan African Resources. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2024 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

The Investment Research is a publication distributed in the United States by Edison Investment Research, Inc. Edison Investment Research, Inc. is registered as an investment adviser with the Securities and Exchange Commission. Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

General disclaimer and copyright

This report has been commissioned by Pan African Resources and prepared and issued by Edison, in consideration of a fee payable by Pan African Resources. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2024 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

The Investment Research is a publication distributed in the United States by Edison Investment Research, Inc. Edison Investment Research, Inc. is registered as an investment adviser with the Securities and Exchange Commission. Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

More on Pan African Resources

View All

Latest from the Metals & Mining sector

View All Metals & Mining content

Research: TMT

CLIQ Digital — FY24 outlook weakened

CLIQ Digital has lowered its financial outlook for FY24 due to the transition to new sales channels in H124. This was coupled with elevated churn following a change in refund programmes from credit card providers, flagged in Q124, which allows subscribers to cancel more easily. The transition to the ‘Magnificent Seven’ sales channels, which aims to diversify CLIQ’s marketing channels from traditional display advertising to search engine advertising, affiliation and business-to-business (B2B) partnerships, has meant new customer acquisitions have been slower than previously anticipated. We have cut our FY24 forecasts, which are now towards the lower end of management’s guidance. Our reduced FY25 revenue estimate is below company guidance; we will review our forecasts with subsequent trading updates.

Continue Reading

Subscribe to Edison

Get access to the very latest content matched to your personal investment style.

Sign up for free