Pan African Resources — Upgraded FY24 production guidance

Pan African Resources (AIM: PAF)

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Research: Metals & Mining

Pan African Resources — Upgraded FY24 production guidance

On 9 May, Pan African announced that it was narrowing its production guidance for the year ending 30 June 2024 to 186–190koz (cf 180–190koz previously), notwithstanding the cessation of production from surface sources at Evander in H2. Group AISC guidance was maintained at US$1,325–1,350/oz (at ZAR18.50/US$) however. Consequently, we have increased our H2 production forecast by 2.5% as well as increasing our H224 gold price by 9.2% to result in a US$20.6m positive variance in H224e revenue, only partially offset by incidental higher costs, to result in a 41.7% increase in H224e normalised EPS and a 19.1% increase in FY24e normalised EPS. Production guidance was also provided for FY25 of 215–225koz, which compares with Edison’s prior (and unchanged – and, in the event, relatively conservative) forecast of 216.6koz.

Lord Ashbourne

Written by

Lord Ashbourne

Director of Content, Mining

Metals & Mining

Pan African Resources

Upgraded FY24 production guidance

Updated production guidance and EPS revisions

Metals and mining

20 May 2024

Price

26.70p

Market cap

£512m

ZAR23.0097/£, ZAR18.3215/US$, US$1.2554/£

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 exchange

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

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 9 May, Pan African announced that it was narrowing its production guidance for the year ending 30 June 2024 to 186–190koz (cf 180–190koz previously), notwithstanding the cessation of production from surface sources at Evander in H2. Group AISC guidance was maintained at US$1,325–1,350/oz (at ZAR18.50/US$) however. Consequently, we have increased our H2 production forecast by 2.5% as well as increasing our H224 gold price by 9.2% to result in a US$20.6m positive variance in H224e revenue, only partially offset by incidental higher costs, to result in a 41.7% increase in H224e normalised EPS and a 19.1% increase in FY24e normalised EPS. Production guidance was also provided for FY25 of 215–225koz, which compares with Edison’s prior (and unchanged – and, in the event, relatively conservative) forecast of 216.6koz.

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

7.5

3.1

06/23

321.6

92.9

3.54

0.95

9.5

2.8

06/24e

390.3

141.7

5.73

0.99

5.8

2.9

06/25e

420.8

162.4

6.28

0.98

5.3

2.9

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

MTR on time and on budget

In addition to its guidance upgrade, PAF also reported that construction at its new Mogale Tailings Retreatment (MTR) project is progressing on time and within budget. Commissioning and steady state production are still on track for December 2024, thereby confirming our longer-term production and EPS forecasts of >250koz pa and >6c/share, respectively, from FY26.

Valuation: Nosing in towards 40p

Given our revised forecasts, our core (absolute) valuation of Pan African has increased by a material 16.8% to 48.08c/share (38.30p), based on projects either sanctioned or already in production. This valuation rises by a further 22.17–27.19c 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 38.30p in FY24, followed by 41.94p in FY25. As such, PAF’s current share price of 26.70p could be interpreted as discounting normalised HEPS falling to 4.00c per share (cf our forecasts of 5.73c/share for FY24 and 6.28c/share for FY25), which is barely above FY23’s level. In the meantime, PAF remains cheaper than its principal London- and South African-listed gold mining peers on at least 66% of commonly used valuation measures regardless of whether Edison or consensus forecasts are used. Performing a relative valuation analysis, its peers imply a comparable valuation for PAF of 63.21p based on our year one EPS estimate and one of 48.06p based on our year two EPS estimate. Separately, we estimate that PAF has the 18th highest dividend yield of the 62 precious metals mining companies expected to pay dividends to shareholders in the next 12 months (globally). Finally, we calculate that it is trading at an enterprise value that equates to just US$17.39 per resource ounce of gold.

FY24 guidance

On 9 May, Pan African announced that it was narrowing its production guidance for the year ending 30 June to 186–190koz (cf 180–190koz), notwithstanding the end of processing marginal surface sources at Evander during H224. Nonetheless, group all-in sustaining cost (AISC) guidance was maintained at US$1,325–1,350/oz (at an assumed exchange rate of ZAR18.50/US$). Production guidance was also provided for FY25 of 215–225koz, which compares with Edison’s unchanged (and, in the event, relatively conservative) forecast of 216.6koz.

In the light of PAF’s announcement, we have updated our half year and full year production expectations for FY24 to those shown below:

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

35,175

33,175

-5.7

-2,000

69,955

79,235

BTRP

10,004

8,235

9,126

10,434

10,012

9,863

9,864

5,136

8,500

+65.5

+3,364

18,364

10,000

Barberton

52,354

50,711

49,117

46,181

42,034

42,427

46,644

40,311

41,675

+3.4

+1,364

88,319

89,235

Evander UG

12,607

23,409

27,312

21,538

19,173

10,359

21,307

20,413

19,693

-3.5

-720

41,000

53,196

Evander surface

6,560

4,677

5,756

3,564

5,270

5,373

2,401

1,386

99

-92.9

-1,287

2,500

0

Evander

19,169

28,086

33,068

25,102

24,443

15,732

23,708

21,799

19,792

-9.2

-2,007

43,500

53,196

Elikhulu

26,863

24,596

25,900

26,320

25,830

24,743

28,106

23,130

25,902

+12.0

+2,772

54,008

48,219

MTR

25,956

Total

98,386

103,391

108,085

97,603

92,307

82,902

98,458

85,240

87,369

+2.5

+2,129

185,827

216,616

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

In addition to changes to our immediate output assumptions, we have increased our estimate of the gold price for the remainder of the financial year to June from US$2,017/oz previously (see our note A happy valentine, published on 20 February 2024) to US$2,347/oz (ie that prevailing at the time of writing).

At the same time, we have adjusted our foreign exchange rates to reflect the recent relative strength of the rand against both the US dollar and sterling:

from ZAR23.8998/£ to ZAR23.0097/£ (-3.7%),

from ZAR18.9774/US$ to ZAR18.3215/US$ (-3.4%), and

from US$1.2593/£ to US$1.2554/£ (-0.3%).


Updated FY24 financial forecasts

Relative to our prior forecast for H224e – and all other things being equal – we expect these changes to result in a positive variance to revenue of US$20.6m, partially offset by an additional US$6.6m in ‘other’ expenses (in this case, a contract liability for the ZAR400m upfront payment that PAF received in March 2023 for its Mintails funding at rand gold prices in excess of ZAR1,025,000/kg – see our note Innovative funding avoids dilution, published on 17 March 2023) and a US$5.5m negative variance in tax to result in a positive variance of US$11.2m, or 44.4%, at the post-tax level:

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

175,750

196,376

11.7

390,323

369,697

Cost of production

(108,368)

(118,077)

(99,282)

(99,508)

(110,292)

(101,559)

(98,695)

-2.8

(208,987)

(211,851)

Depreciation

(13,268)

(13,160)

(11,122)

(9,277)

(10,768)

(11,132)

(11,146)

0.1

(21,914)

(21,900)

Mining profit

71,938

51,560

46,085

56,332

72,887

63,059

86,535

37.2

159,422

135,946

Other income/(expenses)

(7,711)

(2,117)

(3,610)

(3,737)

(7,231)

(17,148)

(23,720)

38.3

(30,951)

(24,379)

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)

(2,202)

(2,460)

11.7

(3,702)

(3,444)

Net income before finance

62,910

48,197

42,007

52,100

64,414

43,709

60,354

38.1

124,768

108,123

Finance income

661

434

456

683

760

0

N/A

Finance costs

(1,945)

(3,381)

(3,464)

(6,228)

(5,594)

0

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

34,508

51,154

48.2

110,734

94,088

Taxation

(15,573)

(16,351)

(10,063)

(14,754)

(17,223)

(9,365)

(14,845)

58.5

(32,068)

(26,588)

Effective tax rate (%)

25.3

36.1

25.8

31.7

28.9

27.1

29.0

7.1

29.0

28.3

PAT (continuing ops)

46,053

28,899

28,936

31,801

42,357

25,143

36,309

44.4

78,666

67,500

Minority interest

(185)

(136)

(266)

(224)

0

0

N/A

(224)

(224)

Ditto (%)

(0.6)

(0.5)

(0.8)

(0.5)

0.0

0

N/A

(0.3)

(0.3)

Attributable profit

29,084

29,072

32,067

42,581

25,143

36,309

44.4

78,890

67,724

 

 

Headline earnings

46,053

29,551

29,072

31,392

42,581

25,143

36,309

44.4

78,890

67,724

Est. normalised headline earnings

53,764.1

31,668

32,682

35,129

49,812

42,291

60,029

41.9

109,841

92,103

 

 

 

EPS (c)

2.39

1.51

1.52

1.67

2.22

1.31

1.89

44.6

4.12

3.53

HEPS** (c)

2.39

1.54

1.52

1.63

2.22

1.31

1.89

44.6

4.12

3.53

Normalised HEPS (c)

2.79

1.65

1.71

1.83

2.60

2.21

3.13

41.7

5.73

4.81

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

Once again, we expect deferred taxes to account for the majority of the total tax charge for the year, with cash taxes paid amounting to less than half the total tax charge.

Growth projects

PAF has two organic growth projects currently underway (namely the MTR project within the Mintails Soweto Cluster and the Evander 24 to 26 Level expansion project) and one more immediately in prospect (the Sheba Fault project). Beyond these, it has the Egoli and Fairview sub-vertical shaft projects at feasibility study stage followed by Rolspruit, Poplar and Evander South also available for development.

Mintails Soweto Cluster

Mogale (MTR)

On 1 August 2023, PAF announced that all conditions precedent for its ZAR1.3bn senior debt facility, designated for funding the group’s MTR project, had been fulfilled, thereby completing the full upfront funding package of ZAR2.5bn. Since then, PAF reports that construction is progressing on time and within budget, with commissioning and steady state production on track for December 2024.

In addition, PAF reported that it had updated its financial model (relative to the initial definitive feasibility study model) to reflect the latest operating cost updates, as well as a ZAR19.00/US$ forex rate and a US$2,200/oz gold price. Given these changes, the pertinent results of the updated financial model were:

A near threefold increase in pre-tax NPV from US$63m to US$183m.

A doubling of the ungeared real internal rate of return from 20.1% to 41.7%

A two-year payback on upfront capital investment of c US$135.1m (cf an initial DFS model estimate of 3.5 years), post commissioning.

Soweto cluster

In addition to its update on the MTR, PAF announced the results of an internal pre-feasibility study (PFS) for the Soweto cluster that was completed in March 2024, based on drill results from the 2L16 and 2L24 tailings storage facilities. The PFS considered a number of options, of which the most feasible was considered to be the processing of the Soweto cluster material at the MTR plant. In this case, the MTR plant’s capacity could be expanded to process 1Mtpm of feed material (cf the current design capacity of 800ktpm) to result in a mine life of 21 years for the combined Mogale and Soweto cluster resources (NB this scenario was already broadly assumed in our prior valuation of the project). The resultant tailings could then be deposited into the expanded Mogale tailings storage facility (TSF) at the West Wits pit and 1L23-25 footprint.

Other specific results of the PFS were as follows:

The MTR plant infrastructure can be expanded to treat 1Mtpm from year six of the MTR operation’s mine life (ie approximately 2030).

The addition of the 110Mt Soweto cluster mineral resource has the potential to increase MTR production to approximately 60koz pa over a 21-year mine life.

Total additional capex for the project would be US$113m, of which c US$83m would be incurred in years 4–6 of the MTR project timeline and US$29m would be incurred in year 10 of the timeline.

At US$2,200/oz and a forex rate of ZAR19.00/US$, the pre-tax NPV for the combined Mogale-Soweto cluster is US$283m (or 17.7c, or 11.8p, per share), representing an increase of >50% relative to the MTR project alone.

The real, ungeared internal rate of return of the combined project increases to 44.0% (cf 41.7% for the MTR project alone).

We have now updated our financial model for the disclosures noted above – and, in particular, the timing of capex – and incorporated this into our valuation of the project. In the meantime, Pan African is proceeding with the necessary permitting and servitudes required for the re-mining and processing of the Soweto cluster, with a final investment decision anticipated ‘in due course.’

Evander 24 to 26 Level expansion project

Progress at Evander’s 24 to 26 Level underground expansion project remains on track, with the following notable achievements during H124:

Construction of Phase 2 of the refrigeration plant on 24 Level at Evander’s 8 Shaft was at an advanced stage, with completion anticipated this financial year, as 24 Level mining operations ramp up.

Development to access 25 and 26 Level mining areas commenced (NB access to 25 Level mining areas is expected to be completed in FY26).

Equipping of the existing 17 Level underground ventilation shaft – with a hoisting capacity of up to 40,000tpm – is also expected to be completed in FY24, improving efficiencies and circumventing the ageing conveyor belt system.

At the same time, the Egoli project’s 7 Shaft number 3 Decline has been dewatered to below 20 Level, where permanent pumping infrastructure will be installed together with a drilling platform for long, inclined borehole drilling into the resource block to improve reserve delineation and further define the ore pay-shoot and its grade variability.

BTRP life of mine extension and Royal Sheba

The remaining life of mine from the BTRP’s current tailings sources is estimated at two years and will then be supplemented with the Sheba Fault project, first from Royal Sheba and then Western Cross, where the extraction and processing of a 10,000t bulk sample was recently successfully completed.

Preliminary optimisation work estimates an eight-year lifespan at Royal Sheba, with production of around 235,000oz of gold at an average mining grade of 3g/t over the life of mine, with the potential for further extensions as the orebody remains open at depth. First stoped ore is planned in 2025 at 5,000t per month, ramping up to 10,000t, 30,000t and 45,000t per month, every 12 months thereafter in line with a set lateral and vertical development schedule.

The Western Cross orebody at Sheba Mine is a lower-grade (3–4g/t) 10m wide free-milling orebody that is currently accessed via the South Wall Adit and forms part of the mine’s production profile. The orebody is amenable to bulk mining, similar to that planned at Royal Sheba, and will further supplement feed material to the BTRP. Drilling is planned for the 2025 financial year to update the geological model, confirm available mineral resource blocks and update the existing feasibility study.

Group production

In the wake of the company’s production update, our longer-term forecasts remain, to all intents and purposes, unchanged. As such, we are continuing to forecast that group production at PAF will reach c 250koz per year in 2026 and drive 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 updated guidance (as well as revised external factors such as the gold price and forex rates, above), our absolute valuation of PAF (based on its existing four producing assets plus the 25 and 26 Level project and Mogale) has increased from 41.15c (discounted to 1 July 2023) previously to 48.08c (discounted to 1 July 2024) currently, which is 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: *From FY26. Excludes discretionary exploration investment.

A summary of the changes to both our valuation and our FY24 earnings forecasts according to each factor considered in our analysis is as follows:

Exhibit 5: PAF valuation and EPS change summary

Factor

Valuation

(US$/share)

FY24e normalised HEPS forecast (US$/share)

H224e normalised HEPS forecast (US$/share)

Initial

41.15

4.81

2.21

FY24 production revisions

41.41

5.07

2.47

Forex

40.33

5.01

2.40

H224 gold price

41.00

5.61

3.00

Mintails’ financing contract liability

40.73

5.73

3.13

Valuation advancement start-FY23 to start FY24

48.08

5.73

3.13

Source: Edison Investment Research

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

Exhibit 6: 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)

48.08

41.15

Cum-FY24 dividend

0.99

-

Royal Sheba*

0.93

0.63

Other

1.61

1.14

Sub-total

51.61

42.92

EGM underground resource

0.22–5.24

0.22–5.24

Sub-total

51.83–56.85

43.14–48.16

Egoli

16.94

17.09

Soweto cluster

1.48

1.93

Total

70.25–75.27

62.16–67.18

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

Historical relative and current peer group valuation

Historical relative valuation

Exhibit 7 below 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 (26.70p) is compared with our forecast normalised HEPS for those years. As is apparent from the graph, PAF’s price to normalised HEPS ratios of 5.8x and 5.3x for FY24 and FY25 respectively (based on our forecasts, see Exhibits 2 and 9) 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 7: Pan African historical price to normalised HEPS** ratio, FY10–FY25e

Source: Edison Investment Research. 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 38.30p in FY24 (cf 32.02p previously) followed by one of 41.94p in FY25 (cf 38.72p previously). Stated alternatively, PAF’s current share price of 26.70p, at prevailing forex rates, appears to be discounting FY24 and/or FY25 normalised HEPS of 4.00c per share (cf 3.54c reported in FY23 and 5.73c and 6.28c forecast in FY24 and FY25, respectively).

Relative peer group valuation

In the meantime, it may be seen that PAF remains cheaper than its London- and South Africanlisted gold mining peers on at least 66% of comparable common valuation measures (16 out of 24 individual measures in the table below) regardless of whether Edison or consensus forecasts are used:

Exhibit 8: 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

Sibanye Stillwater

4.2

3.7

21.8

8.0

3.2

3.8

Harmony

5.7

4.6

10.9

8.2

1.5

2.2

Centamin

3.3

3.0

9.7

10.5

3.0

6.1

Endeavour Mining

4.8

4.1

13.1

11.8

3.9

4.6

Average (excluding PAF)

4.5

3.9

13.8

9.6

2.9

4.1

PAF (Edison)

4.0

3.4

5.8

5.3

2.9

2.9

PAF (consensus)

4.5

3.6

7.6

6.1

2.9

4.5

Source: Edison Investment Research, Refinitiv, LSEG. Note: Consensus and peers priced at 20 May 2024.

Stated alternatively, applying PAF’s peers’ average year one P/E ratio of 13.8x to our forecast normalised HEPS forecast of 5.73c per share for FY24 implies a share price for the company of 63.21p at prevailing forex rates. Applying its peers’ average year two P/E ratio of 9.6x to our forecast normalised HEPS forecast of 6.28c per share implies a share price of 48.06p.

Exhibit 9: Financial summary

US$'000s

2022

2023

2024e

2025e

Year end 30 June

IFRS

IFRS

IFRS

IFRS

PROFIT & LOSS

Revenue

 

 

376,371

321,606

390,323

420,772

Cost of sales

(226,445)

(198,790)

(208,987)

(209,567)

Gross profit

149,926

122,816

181,336

211,204

EBITDA

 

 

147,830

121,853

177,634

206,608

Operating profit (before amort. and excepts.)

 

 

121,402

101,454

155,720

170,820

Intangible amortisation

0

0

0

0

Exceptionals

(10,295)

(7,347)

(30,951)

(7,908)

Other

0

0

0

0

Operating profit

111,107

94,107

124,768

162,913

Net interest

(4,231)

(8,553)

(14,035)

(8,446)

Profit Before Tax (norm)

 

 

117,171

92,901

141,685

162,374

Profit before tax (FRS 3)

 

 

106,876

85,554

110,734

154,467

Tax

(31,924)

(24,817)

(32,068)

(42,093)

Profit after tax (norm)

85,247

68,084

109,617

120,282

Profit after tax (FRS 3)

74,952

60,737

78,666

112,374

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

5.73

6.28

EPS - FRS 3 (c)

 

 

3.90

3.19

4.12

5.86

Dividend per share (c)

1.04

0.95

0.99

0.98

Gross margin (%)

39.8

38.2

46.5

50.2

EBITDA margin (%)

39.3

37.9

45.5

49.1

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

32.3

31.5

39.9

40.6

BALANCE SHEET

Fixed assets

 

 

401,139

439,676

571,678

607,425

Intangible assets

44,210

44,429

46,612

48,792

Tangible assets

355,802

395,247

525,065

558,633

Investments

1,127

0

0

0

Current assets

 

 

55,953

61,263

49,885

120,292

Stocks

9,977

9,567

13,011

14,036

Debtors

17,546

15,182

27,804

29,994

Cash

26,993

34,771

7,327

74,519

Current liabilities

 

 

(58,989)

(77,386)

(93,144)

(111,830)

Creditors

(57,117)

(65,884)

(81,642)

(104,794)

Short-term borrowings

(1,872)

(11,502)

(11,502)

(7,036)

Long-term liabilities

 

 

(103,494)

(128,957)

(173,986)

(167,909)

Long-term borrowings

(37,088)

(45,334)

(89,670)

(82,392)

Other long-term liabilities

(66,406)

(83,623)

(84,316)

(85,517)

Net assets

 

 

294,609

294,596

354,433

447,978

CASH FLOW

Operating Cash Flow

 

 

142,879

132,941

110,250

188,325

Net Interest

(2,794)

(5,121)

(14,035)

(8,446)

Tax

(8,520)

(7,722)

(3,543)

(17,857)

Capex

(81,951)

(109,952)

(153,916)

(71,535)

Acquisitions/disposals

563

(2,779)

0

0

Financing

(3,222)

0

(0)

(0)

Dividends

(21,559)

(19,975)

(21,200)

(18,829)

Net cash flow

25,396

(12,608)

(82,444)

71,658

Opening net debt/(cash)

 

 

23,553

11,967

22,065

93,844

Exchange rate movements

(4,401)

(4,481)

0

0

Other

(9,409)

6,991

10,664

7,277

Closing net debt/(cash)

 

 

11,967

22,065

93,844

14,909

Source: company accounts, Edison Investment Research. 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.


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United Kingdom

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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

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