Pan African Resources PLC
('Pan African Resources' or the 'company' or the 'group')
(Incorporated and registered on 25
February 2000 in England
and Wales under the Companies Act
1985, registration number 3937466)
Share code on AIM |
: PAF |
Share code on JSE |
: PAN |
ISIN |
: GB0004300496 |
Provisional audited results for the
year ended 30 June 2017 and proposed
final dividend announcement
Cobus Loots, CEO of Pan
African Resources commented: “The 2017 financial year was
operationally challenging. The remedial actions successfully
implemented by management are however delivering the expected
results. We have appropriately addressed critical shaft
infrastructure repairs at Evander Mines, and the operation’s cost
base is now leaner, without compromising the safety or
sustainability of the business. Pan African Resources looks
forward to a much improved performance from Evander Mines in the
2018 financial year, with a substantial increase in expected gold
production. Despite mining flexibility challenges, Barberton Mines,
our flagship long-life cash flow producer, is currently mining
high-grade panels in its Fairview 11-block and is poised to
contribute substantially to our production guidance of 190,000oz
for the 2018 financial year. The Elikhulu Project is on schedule,
with environmental approvals now in place, and is expected to
produce first gold in the final quarter of the 2018 calendar year.
Additionally, we are excited about the prospects for Evander Mines’
2010 Pay Channel project and our team has commenced a feasibility
study on this project.
The disposal of the Uitkomst Colliery on 30 June 2017 to Coal of Africa realised a profit of R91.3 million,
demonstrating the value created over the 15 months of our
ownership. The recently announced disposal of Phoenix Platinum to
Sylvania reaffirms our focus on core operations and the cash
consideration will further strengthen our financial position. The
benefits of the PAR Gold transaction, completed in the prior
financial year, has the accounting effect of reducing the issued
share capital by 436.4-million shares in the 2017 financial year,
equating to 19.53% of the issued share capital of the company.
The board is proposing a final dividend of R185 million, or
GBP10.9 million, which again results
in an attractive cash return to our shareholders.”
Key features reported in South African
Rand (‘ZAR’ or ‘R’) and Pound Sterling (‘GBP’)
Financial key features
- Group revenue from continuing operations decreased by 15.5% to
R2,925.3 million (2016: R3,460.1 million). In GBP terms, group
revenue increased by 5.1% to GBP169.6
million (2016: GBP161.3
million), the GBP percentage movement was positive due to
the appreciation of the ZAR/GBP exchange rate.
- In ZAR terms, group profit after taxation decreased by 43.3% to
R309.9 million (2016: R547.0 million), while in GBP terms, group
profit after taxation decreased by 29.8% to GBP17.9 million (2016: GBP25.5 million). Profits were adversely impacted
by reduced gold production and a flat rand gold price during the
year.
- Earnings per share (‘EPS’) decreased by 34.4% to 19.81 cents per share (2016: 30.20 cents per share), while in GBP terms, EPS
decreased by 19.1% to 1.14 pence per
share (2016: 1.41 pence per
share).
- Gold production and realisation costs were well contained,
increasing by only 7.7% to R2,343.1 million (2016: R2,176.0
million).
- The Pan African Resources board of directors (the ‘board’)
approved the R1.74 billion Elikhulu tailings retreatment project
(‘Elikhulu Project’) during the 2017 financial year. The project is
now fully funded with all environmental approvals in place and
construction commenced in August
2017.
- Uitkomst Colliery Proprietary Limited (‘Uitkomst Colliery’)
performed well and contributed R35.4 million (2016: R12.7 million),
or 11.4%, to group profit after taxation, before its disposal to
Coal of Africa Limited (‘Coal of Africa’) on 30 June 2017. The disposal of Uitkomst Colliery
to Coal of Africa realised a
profit on sale of R91.3 million. (Note 1)
- The statement of financial position is robust with net debt
reducing to R67.6 million (2016: R339.6 million) at year end.
- The board has proposed a final dividend of R185 million, or
approximately GBP10.9 million (2016:
R300 million or GBP17.1 million),
equating to R0.08279 per share, or approximately 0.48697 pence per share (2016: R0.1544 per share
or 0.88 pence per share) for the 2017
financial year. This dividend is subject to shareholder approval at
the annual general meeting (‘AGM’), which will take place on
Tuesday, 21 November 2017. (Note
2)
- Post year end, Pan African Resources concluded a sale agreement
to dispose of Phoenix Platinum Proprietary Limited (‘Phoenix
Platinum’) to Sylvania Platinum Limited (‘Sylvania’) for a cash
consideration of R89 million. This transaction remains subject only
to Competition Commission approval. The transaction resulted in an
impairment of Phoenix Platinum by R100.9 million at year end.
Operational key features
- Following a challenging operational year, group gold production
decreased by 15.4% to 173,285oz (2016: 204,928oz).
- Effective ZAR gold price received remained unchanged at
R542,773/kg (2016: R542,850/kg), with the average ZAR/USD exchange
rate being 6.3% stronger at R13.59:1 (2016: R14.51:1) and the USD
gold price increasing by only 6.7% to USD1,242/oz (2016: USD1,164/oz).
- Cash cost per kilogramme increased in ZAR terms to R430,863/kg
(2016: R338,242/kg) and, in USD terms, cash costs per ounce
increased to USD986/oz (2016:
USD725/oz), predominantly due to
lower gold production.
- All-in sustaining cost per kilogramme increased in ZAR terms to
R514,435/kg (2016: R405,847/kg) and, in USD terms, all-in
sustaining cost per ounce increased to USD1,177/oz (2016: USD870/oz).
- Pan African Resources advised shareholders on 25 August 2017 that the Integrated Water Use
Licence for the Elikhulu Project had been granted by the Department
of Water and Sanitation, for a period of 20 years. Furthermore, the
Integrated Environmental Authorisation was also issued in terms of
the National Environmental Management Act 107 of 1998. All
environmental regulatory permits are therefore in place for the
group to commence construction and operation of the Elikhulu
Project, which will add approximately 56,000oz per annum to the
group’s production profile from the last quarter of the 2018
calendar year.
- At 30 June 2017, group gold
resources were relatively unchanged at 34.4Moz (30 June 2016: 34.9Moz).
- The group unfortunately had three employees fatally injured in
the current financial year (2016: one employee fatally injured),
and remains focused on reducing the severity of accidents. The
group’s lost-time injury frequency rate (‘LTIFR’) remained stable
at 3.51 (2016: 3.50) whilst the reportable injury frequency rate
(‘RIFR’) improved to 1.53 (2016: 2.04). Significant progress has
been made on ensuring the on-mine safety management teams are
appropriately staffed and skilled to drive our safety improvement
campaigns. The safety performance at Barberton Mines Proprietary
Limited (‘Barberton Mines’) and Evander Gold Mines Limited
(‘Evander Mines’) is better than the average industry safety rates,
and the focus remains on improving safety year-on-year.
- Uitkomst Colliery produced and sold 326,744 tonnes of coal
(2016: 87,538t) from the underground mining operations, and 343,466
tonnes of coal (2016:48,564t) acquired from third parties for
blending and processing, prior to the conclusion of the sale to
Coal of Africa.
- Tonnes processed by Phoenix Platinum increased by 13.7% to
283,067t (2016: 248,981t), and platinum group elements (‘PGEs’)
sold increased by 4.4% to 8,709oz (2016: 8,339oz). The plant
recoveries improved by 20.9% to 52.0% (2016: 43.0%) following the
installation of high-energy cells, but this was offset by the head
grade reducing by 21.1% to 2.43g/t (2016:3.08g/t).
- The group’s detailed operational and financial summaries per
entity are disclosed on the Pan African Resources website at
http://www.panafricanresources.com/investors/financial-reports/.
Movement |
For
the year ended 30 June 2017 |
For
the year ended 30 June 2016 |
Unit |
Salient Features |
Unit |
For
the year ended 30 June 2016 |
For
the year ended 30 June 2017 |
Movement |
(15.4%) |
5,390 |
6,374 |
(Kilogrammes) |
Gold
sold |
(Oz) |
204,928 |
173,285 |
(15.4%) |
(15.5%) |
2,925.3 |
3,460.1 |
(R
millions) |
Revenue |
(GBP
millions) |
161.3 |
169.6 |
5.1% |
0.0% |
542,773 |
542,850 |
(R/kg) |
Average
gold price received |
(USD/oz) |
1,164 |
1,242 |
6.7% |
27.4% |
430,863 |
338,242 |
(R/kg) |
Cash
costs |
(USD/oz) |
725 |
986 |
36.0% |
26.8% |
514,435 |
405,847 |
(R/kg) |
All-in
sustaining costs |
(USD/oz) |
870 |
1,177 |
35.3% |
31.8% |
540,693 |
410,206 |
(R/kg) |
All-in
costs |
(USD/oz) |
879 |
1,237 |
40.7% |
(45.6%) |
524.6 |
963.5 |
(R
millions) |
Adjusted
EBITDA (Note 3) |
(GBP
millions) |
44.9 |
30.4 |
(32.3%) |
(43.3%) |
309.9 |
547.0 |
(R
millions) |
Attributable earnings |
(GBP
millions) |
25.5 |
17.9 |
(29.8%) |
(42.3%) |
315.6 |
547.1 |
(R
millions) |
Headline
earnings |
(GBP
millions) |
25.5 |
18.3 |
(28.2%) |
(34.4%) |
19.81 |
30.20 |
(cents) |
Earnings
per share (‘EPS’) |
(pence) |
1.41 |
1.14 |
(19.1%) |
(33.2%) |
20.17 |
30.20 |
(cents) |
Headline
earnings per share (‘HEPS’) |
(pence) |
1.41 |
1.17 |
(17.0%) |
(80.1%) |
67.6 |
339.6 |
(R
millions) |
Net
debt |
(GBP
millions) |
17.2 |
4.0 |
(76.8%) |
24.2% |
330.0 |
265.7 |
(R
millions) |
Total
sustaining capital expenditure |
(GBP
millions) |
12.4 |
19.1 |
54.3% |
102.7% |
613.1 |
302.4 |
(R
millions) |
Total
capital expenditure (Note 4) |
(GBP
millions) |
14.0 |
35.5 |
153.6% |
5.5% |
201.3 |
190.8 |
(cents) |
Net
asset value per share |
(pence) |
10.0 |
12.0 |
20.0% |
(13.6%) |
1,564.3 |
1,811.4 |
(millions) |
Weighted
average number of shares in issue |
(millions) |
1,811.4 |
1,564.3 |
(13.6%) |
(6.3%) |
13.59 |
14.51 |
(R/USD) |
Average
exchange rate |
(R/GBP) |
21.45 |
17.25 |
(19.6%) |
(11.8%) |
13.04 |
14.78 |
(R/USD) |
Closing
exchange rate |
(R/GBP) |
19.78 |
16.96 |
(14.3%) |
Note 1: The Uitkomst Colliery contribution excludes
corporate management fees and inter-company interest on-charged to
the operation during year.
Note 2: The GBP proposed final dividend was
calculated based on 2,234,687,537 total shares in issue and an
illustrative exchange rate of R17:1. Shareholders on the
United Kingdom register are to
note that a revised exchange rate will be communicated prior to
approval of the final dividend at the AGM.
Note 3: Adjusted EBITDA is represented by earnings
before interest, taxation, depreciation and amortisation,
impairments, discontinued operations and profit/(loss) on disposal
of investments.
Note 4: The Elikhulu Project incurred R175.5
million in capital expenditure to 30 June
2017 on civil engineering works and the procurement of
long-lead-time items, such as the tower crane and the
carbon-in-leach tanks, which are critical to ensuring construction
deadlines are met.
CEO STATEMENT
Pan African Resources experienced a difficult year
operationally, with lower gold production and a flat ZAR gold price
environment. Regrettably three employees were fatally injured while
on duty underground. We have conducted internal assessments to take
procedural learnings from each fatal incident. Despite the severe
setback related to the employee fatalities, our safety performance
rates relative to prior years have improved, with our LTIFR
stabilising and the RIFR improving year-on-year. The improvement in
the group’s overall safety performance is encouraging and we
continue to strive towards a zero-harm environment. Gold production
was lower than expected as Evander Mines suspended production for
55 days to carry out critical refurbishments to its shaft
infrastructure, and production at Barberton Mines was below target
due to logistical and flexibility constraints at Fairview,
compounded by community unrest in the Barberton Mines area and
Department of Mineral Resources (‘DMR’) safety stoppages (‘Section
54 regulatory notices’) during the first half of the financial
year.
Evander Mines restructured its operations during the reporting
period, which has resulted in improved operational efficiencies and
a leaner and more sustainable cost base. The shaft failure at
Evander Mines, as reported in February
2017, prompted a review of the mine’s engineering functions
to ensure similar problems are detected timeously in future.
Evander Mines’ shaft infrastructure has also been subject to a
number of internal and external engineering reviews and we believe
the risk of another failure is materially reduced. Our engineering
reviews have identified further infrastructural issues, which are
being addressed to ensure the risk associated with the mine’s
infrastructure is further reduced.
These challenges, which were well flagged during the year,
impacted the group’s results, with gold revenues decreasing by
15.5% to R2,925.3 million (2016: R3,460.1 million), mostly due to
the 15.4% decrease in gold production. The average ZAR gold price
received remained relatively unchanged at R542,773/kg (2016:
R542,850/kg) in a particularly volatile environment, and the ZAR
ended the financial year stronger against the US dollar at R13.59,
compared to R14.51 at the prior year end. Looking ahead, the
outlook for the ZAR is predominantly negative due to ongoing
political, economic and social uncertainties facing South Africa.
Despite the challenges and setbacks, at the end of the 2017
financial year the group has emerged stronger, with reduced debt
levels, and a renewed focus on core operations and its strategic
growth path. Developments at our Evander Mines include the
approval and commencement of construction (after year end) of the
Elikhulu Project and improvements to the reliability of mine
infrastructure, with the completion of critical structural and
engineering refurbishments at Evander Mines’ No 7 Shaft during
March and April 2017. The exploration
programme at Evander Mines’ 2010 Pay Channel has commenced, and if
this area is proven to be a viable mining proposition, the orebody
will be mined from the existing No 7 Shaft, thereby saving the cost
of sinking another deep-level shaft. Work is progressing well at
Barberton Mines’ Fairview shaft, with the development of a
sub-vertical shaft to improve access capacity in mining the
11-block high-grade and long-life orebody.
The sale of Uitkomst Colliery in KwaZulu-Natal to Coal of
Africa realised a profit on sale
of R91.3 million and further boosted the group’s already strong
financial position. The group announced on 31 July 2017 that it will dispose of all of its
shares and loan accounts in Phoenix Platinum to Sylvania for a
total cash consideration of R89 million. The transaction remains
subject only to Competition Commission approval. The results for
Uitkomst Colliery and Phoenix Platinum were reclassified to
discontinued operations in the current and prior financial year on
the statement of comprehensive income.
An important development during the financial year under review
was the gazetting of the revised Mining Charter by the Minister of
Mineral Resources in June 2017, amid
controversies surrounding the lack of consultation between the
government and other stakeholders, including the labour and mining
industry, as well as concerns about specific impositions in this
new charter. The revised Mining Charter was subsequently
suspended in July 2017, and is now
the subject of discussions as well as legal actions by industry
stakeholders. Pan African Resources is supportive of constructive
engagement that results in a Mining Charter geared to the
revitalisation of the mining industry and which underpins job
creation and much-needed economic growth. While we closely
monitor developments regarding the revised Mining Charter, we are
proud of the progress made in our transformation during the past
years, which include our involvement in the communities in which we
operate, and the establishment of employee ownership structures at
all our gold operations.
In the 2017 financial year, the group’s gold production
decreased by 15.4% to 173,285oz (2016: 204,928oz), primarily due to
the following challenges:
- The suspension of production for 55 days at Evander Mines to
complete the refurbishment of critical shaft infrastructure at No 7
Shaft. The consistent review and inspection of critical
infrastructure to manage and ensure limited loss of production
going forward is progressing well.
- Loss of production shifts due to frequent instances of
community unrest in the Barberton Mines area as a result of service
delivery protests, compounded by Section 54 regulatory notices
issued at both Barberton Mines and Evander Mines during the first
half of the financial year. The group continues to engage with all
stakeholders to ensure its operations can function in a stable and
consistent manner.
- Barberton Mines experienced flexibility issues at Fairview,
specifically at its high-grade 11-block, which resulted in lower
grades being mined. Work is underway to develop additional
production platforms to expose further high-grade panels to
increase mining grades and flexibility.
Uitkomst Colliery produced and sold 326,744 tonnes of coal from
its underground mining operations, and 343,466 tonnes of
third-party coal acquired for blending and processing, during the
current reporting period. The operation contributed to
profitability during the 2017 financial year prior to the
conclusion of its sale to Coal of Africa on 30 June
2017.
Phoenix Platinum’s production increased by 4.4% to 8,709oz
(2016: 8,339oz), and its recoveries increased significantly to 52%
from 43%, following the implementation of high-energy agitation
cells in the plant. Production in the current reporting period was
however negatively affected by a reduction in the head grade
achieved on the tailings processed from the Kroondal and
Elandskraal tailings.
Mineral reserves and resources
The group’s mineral resources and reserves in compliance with
the South African Code for Reporting of Mineral Resources and
Mineral Reserves (the SAMREC Code) are summarised as follows:
- Gold resources of 34.4Moz (2016: 34.9Moz)
- Gold reserves of 11.2Moz (2016: 10.0Moz)
- PGE resources of 0.6Moz (2016: 0.6Moz)
- PGE reserves of 0.2Moz (2016: 0.2Moz)
In determining our reserves and resources in the 2017 financial
year, gold reserves were modelled at R550,000/kg and gold resources
at R600,000/kg. During the current year the group’s mineral
resources and reserves were independently reviewed by SRK
Consulting (South Africa) (Pty)
Ltd.
Near- to medium-term growth
projects
Elikhulu Project
Following the successful R696 million equity raise in
April 2017, Pan African Resources
commenced capital expenditure on the project’s civil engineering
works and the procurement of long-lead-time items, such as the
tower crane and the carbon-in-leach tanks, which are critical to
ensuring project deadlines are met. The Elikhulu Project is
progressing according to schedule and is on budget. As announced on
25 August 2017, all environmental
regulatory approvals have been received, allowing construction to
begin, with project completion and first gold expected in the last
quarter of the 2018 calendar year.
Capital expenditure of R175.5 million was incurred on the
Elikhulu Project during the current reporting period, and capital
spend remains on track relative to the total initial forecast
capital expenditure of R1.74 billion, which includes contingencies
of R200 million.
The R1 billion term debt facility agreement, which was
underwritten by Rand Merchant Bank,
a division of FirstRand Bank Limited, has also become effective and
was successfully syndicated, with an over-subscription of more than
50%.
Together with the group’s existing R1 billion revolving credit
facility, these facilities comprise the core debt instruments for
funding the group’s capital expenditure programmes. The low-cost,
long-life Elikhulu Project is expected to increase the group’s
annual gold production by 56,000oz per annum in the initial eight
years and substantially reduce the group’s weighted average all-in
cost of production.
Evander Mines’ 2010 Pay Channel
The 2010 Pay Channel resource is adjacent to the No 7 Shaft
infrastructure and extends from the boundary of Taung Gold
International Limited’s No 6 Shaft project and mining rights. The
Resources for this project are summarised in the table below:
No 7
Shaft: No 3 Decline and 2010 Pay Channel resources |
Category |
Tonnes |
Grade |
Contained gold |
Million |
g/t |
Tonnes |
Moz |
Measured |
0.45 |
8.94 |
4.0 |
0.13 |
Indicated |
0.70 |
7.11 |
5.0 |
0.16 |
Inferred |
4.13 |
8.93 |
36.9 |
1.19 |
Total |
5.28 |
8.69 |
45.9 |
1.48 |
As previously reported, Evander Mines embarked on an exploration
programme to drill a further exploration borehole from surface.
During 2017, the exploration borehole successfully intersected the
Kimberley reef at a depth of approximately two kilometres. Refer
below to the table highlighting reef intersections and deflections.
The previous borehole into the 2010 Pay Channel yielded a reef
intersection with a 49cm width at 36.0g/t.
2010 Pay Channel exploration borehole results |
Detail |
Intersection |
Depth(metres) |
Core width (centimetres) |
Grades |
g/t |
cmg/t |
Original |
1 |
2059.3 |
49 |
36.0 |
1,766 |
Intersection |
2 |
2014.6 |
5.7 |
36.8 |
210 |
Deflection 1 |
3 |
2014.9 |
5.7 |
33.2 |
189 |
Deflection 2 |
4 |
2014.8 |
4.8 |
144.7 |
694 |
Harmony Gold Mining Company Limited (‘Harmony’) previously
started development from the No 7 Shaft mine workings towards the
2010 Pay Channel. Due to financial constraints and a reassessment
of capital expenditure priorities, Harmony halted all development
on the Evander Mines’ shafts (other than No 8 Shaft) in 2009,
resulting in the controlled flooding of the development ends and No
7 Shaft’s No 3 Decline, from 21 Level up to 18 Level. Following
dewatering, only standard footwall and on-reef development would
need to be completed by Evander Mines, with the associated
engineering infrastructure, before mining can commence.
The 2010 Pay Channel is approximately 4.5 kilometres in tramming
distance from No 7 Shaft, which is currently used by Evander Mines
for hoisting to the Kinross
metallurgical plant. This compares favourably with the No 8 Shaft
mining areas, which are approximately 12 kilometres in tramming
distances from No 7 Shaft.
The group’s project team has commenced a feasibility study on No
7 Shaft’s No 3 Decline and 2010 Pay Channel resource, which will
address the following critical issues:
- Collation of geological data from the drill-hole intersection
and deflections.
- The cost and timing of dewatering and re-equipping the No 7
Shaft’s No 3 Decline from 18 Level to 21 Level.
- The development cost and timing to access the 2010 Pay
Channel.
- The economic viability of the project.
The 2010 Pay Channel can potentially increase Evander Mines’
underground gold production significantly at a relatively low
capital cost, using Evander Mines’ established shaft and
metallurgical facilities. The feasibility study for the
project is expected to be completed during the first quarter of the
2018 financial year.
Barberton Mines’ sub-vertical shaft
project at Fairview
The Fairview mining operation is currently restricted by the
hoisting capacity of its No 3 Decline, which is used to access
workings below 42 Level. This decline is currently used to
transport employees and material and for rock hoisting. The
11-block of the main reef complex orebody has an average grade of
31.3 g/t and current life-of-mine of 20 years. With no
intervention, future mining at depth will result in increased
travelling distance, reduce employee face time, and cause a lack of
capacity to ensure both ore replacement and exploration
development.
Pan African Resources, with the assistance of DRA Projects SA
Proprietary Limited (‘DRA’), has completed a feasibility study on
the construction of a raise-bored, sub-vertical shaft from
Fairview’s 42 Level to 64 Level, with the potential of continuing
the vertical shaft to 68 Level in future. This sub-vertical
shaft will be used to transport employees and material to the
working areas, which will allow the No 3 Decline to be used
exclusively for rock hoisting, increasing overall capacity and
production from this mining area.
DRA has reviewed the technical and commercial aspects of the
project and the supporting feasibility study has yielded very
positive results. The estimated capital expenditure for the
project, including contingencies, is approximately R105 million, to
be incurred over a two-year period. The productivity improvements
for Fairview are estimated to yield an additional 7,000oz of gold
per annum, which can be optimised further to more than 10,000oz per
annum.
Outlook
In the 2018 financial year, the key focus areas for the group,
from an operational perspective, include:
- Continuing to improve our safety and regulatory compliance
across all operations.
- Achieving its gold production guidance of 190,000oz for the
2018 financial year.
- Ensuring construction of the Elikhulu Project progresses
according to the original schedule and budget.
- Completing the drilling programme deflections on the Evander
Mines 2010 Pay Channel and finalising the technical and economic
evaluation of the project.
- Commencing construction of the Barberton Mines’ sub-vertical
shaft project at Fairview.
- Ensuring sustainable and optimal operating performance at our
gold mining operations.
- Further improving stakeholder engagement to minimise
operational stoppages.
- Concluding the R89 million disposal of Phoenix Platinum to
Sylvania.
The group continues to evaluate acquisitive opportunities,
particularly within other African jurisdictions, in accordance with
the group’s rigorous capital allocation criteria.
We extend our appreciation to our management teams and all other
staff for their hard work and persistence during this challenging
period. Their commitment and perseverance has enabled Pan African
Resources to continue operating successfully. We also thank our
fellow directors for their support and guidance.
FINANCIAL PERFORMANCE
When assessing and discussing Pan African Resources reported
financial performance, financial position and cash flows,
management refers to Alternative Performance Measures (‘APMs’) of
historical or future financial performance, financial position or
cash flows that are not defined or specified under International
Financial Reporting Standards (‘IFRS’). Examples of APMs are
headline earnings and adjusted EBITDA and net debt. These APMs have
been described and reconciled in accordance with the respective
listing requirements for this announcement. The Integrated Annual
Report which will be published prior to the AGM and will have all
the APMs reconciled to the closest IFRS term.
Exchange rates and their impact on
results
All of the group’s subsidiaries are incorporated in South Africa and their functional currency is
ZAR. The group’s business is conducted in ZAR and the accounting
records are maintained in this same currency, with the exception of
precious metal product sales, which are conducted in USD prior to
conversion into ZAR. The ongoing review of the operational results
by executive management and the board is also performed in ZAR.
The group’s presentation currency is GBP due to its ultimate
holding company, Pan African Resources, being incorporated in
England and Wales and being dual-listed in the
United Kingdom (‘UK’) and
South Africa.
During the period under review the average ZAR/GBP exchange rate
was R17.25:1 (2016: R21.45:1) and the closing ZAR/GBP exchange rate
was R16.96:1 (2016: R19.78:1). The year-on-year change in the
average and closing exchange rates of 19.6% and 14.3%,
respectively, must be taken into account for the purposes of
translating and comparing year-on-year results.
The group records its revenue from precious metals sales in ZAR
and the strength in the value of the ZAR/USD exchange rate during
the period under review had a negative impact on the USD revenue
received when translated into ZAR. The average ZAR/USD exchange
rate was 6.3% stronger at R13.59:1 (2016: R14.51:1).
The commentary below analyses the current and prior comparative
period’s results. Key aspects of the group’s ZAR results appear in
the body of this commentary and have been used as the basis against
which its financial performance is measured. The gross GBP
equivalent figures can be calculated by applying the exchange rates
as detailed above.
Analysing the group’s financial
performance
Revenue
The group’s total revenue from continuing and discontinued
operations, year-on-year, decreased in ZAR terms by 5.3% to
R3,440.4 million (2016: R3,632.8 million) and in GBP terms
increased by 17.7% to GBP199.4
million (2016: GBP169.4
million). Group revenue was mainly impacted by:
- The average ZAR gold price received decreased marginally to
R542,773/kg (2016: R542,850/kg), as a result of the average ZAR/USD
exchange rate strengthening by 6.3% to R13.59:1 (2016: R14.51:1)
and the USD gold price received increasing by 6.7% to USD1,242/oz (2016: USD1,164/oz). The GBP revenue figures were
positively impacted by the ZAR/GBP average exchange rate
strengthening by 19.6% year-on-year.
- Gold ounces sold decreased by 15.4% to 173,285oz (2016:
204,928oz), as result of the operational challenges
highlighted.
- Uitkomst Colliery revenue of R432.8 million (2016: R98.0
million), or GBP25.1 million (2016:
GBP4.6 million), disclosed in
discontinued operations, following the conclusion of the disposal
to Coal of Africa on 30 June 2017.
- Phoenix Platinum revenue of R82.2 million (2016: R74.7 million)
or GBP4.8 million (2016: GBP3.5 million) disclosed in discontinued
operations, following its classification as an asset held for sale
ahead of the signing of a disposal agreement with Sylvania.
Cost of production
Gold operations cost of production
The group’s total cost of production (including realisation
costs) for gold operations was well controlled and increased by
7.7% to R2,343.1 million (2016: R2,176.0 million).
Pan African Resources’ gold cost of production (excluding
realisation costs), per the statement of comprehensive income,
increased by 7.2% to R2,311.6 million (2016: R2,155.5
million). The main cost contributors that impacted the
year-on-year cost increase during the current reporting period are
summarised as follows:
- Group gold operations’ salaries and wages (represents 43.1% of
the total gold cost of production) increased by 4.5% to R1,010.8
million (2016: R967.7 million). Salaries and wages increased in
line with the gold labour agreements signed in the 2016 financial
year, but this was off-set by the reduction in labour costs at
Evander Mines due to the retrenchment of 628 employees at the
operation.
- The group’s electricity costs (represents 13.8% of the total
gold cost of production) increased by 2.1% to R324.0 million (2016:
R317.3 million). The National Energy Regulator of South Africa approved an increase of 7.9% for
the period 1 July 2016 to
31 March 2017, and 2.2% from
1 April 2017. Production challenges
detailed previously also contributed to lower power consumption,
specifically at Evander Mines during the 55-day suspension of
underground operations.
- The group’s mining and processing costs (represents 28.3% of
total gold cost of production) increased by 18.0% to R662.6 million
(2016: R561.3 million), mainly due to the following material
expenses:
- The Evander Tailings Retreatment Plant’s (‘ETRP’) processing
costs increased by R60.4 million or 44.2% due to treating
additional surface feedstock material. The tonnes of surface
feedstock processed increased by 17.8% to 467,610 tonnes (2016:
396,942 tonnes) and this contributed an additional R33.4 million to
the group’s adjusted EBITDA.
- Maintenance of Evander Mines’ No 7 Shaft infrastructure
resulted in an additional R4.5 million expenditure being
incurred.
- In the comparative reporting period the gold operations
recorded an inventory adjustment in operational costs of R4.6
million, due to releasing gold inventory at 30 June 2016, whilst in the current financial
year the gold inventory adjustment was a R12.7 million credit to
costs due to holding more gold inventory at financial year
end.
The group’s gold cost of production per kilogramme increased by
27.4% to R430,863/kg (2016: R338,242/kg). The increase is
attributed to:
- Gold sold decreasing by 15.4% to 173,285oz (2016:
204,928oz).
- The 7.7% increase in gold production and realisation costs as a
result of the reasons highlighted above.
The group’s all-in sustaining cost of production per kilogramme
of gold (including direct cost of production, royalties, associated
corporate costs and overheads, and sustaining capital expenditure,
excluding cost-collar mark-to-market expenses) increased by 26.8%
to R514,435/kg (2016: R405,847/kg). In USD terms the all-in
sustaining cost per ounce increased to USD1,177/oz (2016: USD870/oz). The group’s all-in sustaining costs
were primarily impacted by an increase in gold production costs and
a decrease in gold sold.
The all-in gold cost per kilogramme (sustaining cost of
production and once-off expansion capital, but excluding the
Elikhulu Project capital) increased by 31.8% to R540,693/kg (2016:
R410,206/kg), due to the increase in once-off capital expansion
costs to R100.8 million (2016: R27.8 million), which related mostly
to the construction of the Barberton Tailings Retreatment Plant’s
(‘BTRPs’) cyanide detoxification plant of R17.8 million and
Fairview’s ventilation refrigeration and infrastructure of R41.5
million. In USD terms, the all-in cost per ounce increased to
USD1,237/oz (2016: USD879/oz).
PGE cost of production
Phoenix Platinum’s cost of production is disclosed within
discontinued operations on the statement of comprehensive income,
following the announcement on 31 July
2017 that a sale agreement, for R89 million cash
consideration, was signed with Sylvania, and now remains subject to
Competition Commission approval. Phoenix Platinum is classified as
an asset held for sale on the statement of financial position in
the current reporting period, as Pan African Resources’ intent is
to dispose of the operation within the next 12 months.
The PGE cost of production increased by 16.6% to R86.4 million
(2016: R74.1 million), largely due to refining and processing costs
increasing by 18.2% to R57.1 million (2016: R48.3 million). Higher
refining costs were incurred due to higher chrome prevalence in the
tailings processed from the Elandskraal/Kroondal tailings prior to
entering into a new refining agreement effective in December 2016. Additional transport costs were
also incurred to deliver tailings material from the more distant
Elandskraal/Kroondal tailings sites.
Coal cost of production
The Uitkomst Colliery’s production cost in the current financial
year of R375 million (2016: R91.8 million) is disclosed within the
discontinued line item on the statement of comprehensive income
while, in the comparative period, production costs was only for
three months from 1 April 2016 to
30 June 2016.
Realisations costs
The group’s realisation costs increased to R31.5 million (2016:
R20.5 million) due to an additional R15.4 million in refining costs
associated with the extraction and recovery of gold from various
sections of the Evander Mines’ processing plant by a contractor.
This initiative contributed 160.5kg (5,160.9oz) of gold to
Evander Mines’ production over the life of the project.
Depreciation costs
Depreciation from continuing operations decreased by 15.6% to
R181.0 million (2016: R214.4 million). The depreciation charge is
based on the available units of production over the life of the
operations and, with the reduced mining tonnages and gold
production for the reasons mentioned in the CEO statement, the gold
operations’ depreciation reduced commensurately. The depreciation
was further reduced by an adjustment to residual values of
property, plant and equipment on the gold operations.
Other expenditure and income
The group had no outstanding short-term hedges at 30 June 2017. In July
2015, Barberton Mines entered in a cost collar, when the
prevailing spot gold price was R440,000/kg, to protect its cash
flows and the group’s annual dividend against severe adverse
movements in the ZAR gold price. During the current reporting
period, the group recorded a pre-tax realised mark-to-market
fair-value gain of R94.7 million on this cost collar (2016: pre-tax
realised cost-collar derivative fair-value loss of R113.8 million).
This gain resulted from a reversal of the prior financial year’s
cost-collar mark-to-market liability, which was valued at a
R625,000/kg gold price, which regressed to an average gold price
received of R542,773/kg in the current financial year.
The fair-value adjustment of the group’s rehabilitation
liability resulted in an increase of R0.4 million (2016: R38.2
million decrease in liability). The rehabilitation investment
decreased by R0.9 million (2016: R9.2 million increase in the
investment) due to movements in the market values of the underlying
investments.
Finance costs increased to R48.6 million (2016: R31.1 million),
following increased revolving credit facility utilisation during
the period under review.
During December 2016, the group
disposed of an investment in a listed entity. The investment
represented 1,750,850 shares, which were sold for R23.4 million,
and resulted in a profit of R4.6 million being recognised in the
statement of comprehensive income during the period under review.
Dividends received for the period under review, prior to disposal,
amounted to R0.6 million (2016: R1.0 million).
Taxation
The group’s total taxation charge decreased to R4.2 million
(2016: R184 million).
The taxation charge comprised of:
- A decrease in the current taxation charge by 60.1% to R80.4
million (2016: R203.9 million).
- An increase in the deferred taxation credit to R76.2 million
(2016: deferred taxation credit of R19.9 million), predominantly
due to the deferred taxation associated with the pre-tax realised
mark-to-market fair-value gain of R94.7 million, and a reduction of
the long-term deferred taxation rate to 23.1% from 28% and 25.5%
for Barberton Mines and Evander Mines, respectively.
EPS and HEPS
The group’s EPS in ZAR decreased by 34.4% to 19.81 cents (2016: 30.20
cents). The group’s HEPS in ZAR decreased by 33.2% to
20.17 cents (2016: 30.20 cents). The difference between the EPS and
HEPS has been reconciled below.
The EPS and HEPS are calculated by applying the group’s weighted
average number of shares in issue to the attributable and headline
earnings. The weighted average number of shares in issue decreased
by 13.6% to 1,564.3 million shares (2016: 1,811.4 million shares).
The decrease in shares was attributed to eliminating the PAR Gold
Proprietary Limited (‘PAR Gold’) shares held in Pan African
Resources, whilst including the additional 291.5 million shares
issued in the equity raise concluded on 12
April 2017.
The weighted average number of shares in issued for calculating
earnings per share is reconciled below:
|
30
June 2017 |
30
June 2016 |
Shares in issue at
beginning of year |
1,943.2 |
1,831.5 |
Issue of 291,5 million
shares – vendor placement (date 12 April 2017) (Note 1) |
57.5 |
- |
Issue of 111.7 million
shares – vendor placement (date 3 June 2016) |
- |
8.5 |
Elimination of shares
held by PAR Gold (Note 2) |
(
436.4) |
(28.6) |
Weighted average
shares in issue at end of year |
1,564.3 |
1,811.4 |
Note 1: On 12 April 2017 the group
issued 291,480,983 ordinary shares to fund the equity component of
the Elikhulu Project’s construction.
Note 2: The PAR Gold shares were acquired on 7 June 2016 and, in the current reporting period,
the group benefitted from a full year exclusion of these shares in
the calculation of the weighted average number of shares compared
to the period of less than a month in the corresponding
results.
Total headline earnings per share is calculated as follows:
|
30 June
2017 |
30
June 2016 |
30
June 2017 |
30
June 2016 |
|
GBP
million |
GBP
million |
ZAR
million |
ZAR
million |
Basic earnings |
17.9 |
25.5 |
309.9 |
547.0 |
Adjustments: |
|
|
|
|
Profit on disposal of
investment |
(0.2) |
- |
(4.6) |
- |
Taxation on profit
realised on disposal of investment |
0.1 |
- |
1.0 |
- |
Profit on disposal of
Uitkomst Colliery |
(5.4) |
- |
(91.3) |
- |
Profit on disposal of
property plant and equipment |
(0.1) |
- |
(0.4) |
- |
Taxation on profit
realised on property plant and equipment sale |
- |
- |
0.1 |
- |
Impairment of Phoenix
Platinum |
6.0 |
- |
100.9 |
- |
|
|
|
|
|
Headline earnings |
18.3 |
25.5 |
315.6 |
547.0 |
Headline earnings per
share |
1.17 |
1.41 |
20.17 |
30.20 |
Diluted headline
earnings per share |
1.17 |
1.41 |
20.17 |
30.19 |
Continuing operations headline earnings per share is calculated
as follows:
|
30
June 2017 |
30
June 2016 |
30
June 2017 |
30
June 2016 |
|
GBP
million |
GBP
million |
ZAR
million |
ZAR
million |
Basic earnings for
continuing operations |
22.8 |
25.3 |
391.9 |
543.3 |
Adjustments: |
|
|
|
|
Profit on disposal of
Investment |
(0.2) |
- |
(4.6) |
- |
Taxation on profit on
disposal of Investment |
- |
- |
1.0 |
- |
Profit on disposal of
subsidiary |
(5.4) |
- |
(91.3) |
- |
Profit on disposal
of property plant and equipment |
- |
- |
- |
0.1 |
Headline earnings for
continuing operations |
17.2 |
25.3 |
297.0 |
543.4 |
Headline earnings per
share for continuing operations |
1.10 |
1.40 |
18.98 |
30.00 |
Diluted headline
earnings per share for continuing operations |
1.10 |
1.40 |
18.97 |
29.99 |
Historical dividends paid
The group paid a final dividend of R300 million or GBP17.1 million on 22 December 2016,
relating to the 2016 financial year. This dividend equated to
R0.1544 per share, or 0.88 pence per
share.
Following the PAR Gold transaction, the company received 22.46%
or R67.4 million of the R300 million dividend, resulting in a net
dividend of R232.6 million paid to external shareholders.
Dividend policy
Pan African Resources aspires to pay a regular dividend to its
shareholders. In balancing this cash return to shareholders with
the group’s strategy of generic and acquisitive growth, Pan African
Resources believes a target pay-out ratio of 40% of net cash
generated from operating activities - after allowing for the cash
flow impact of sustaining capital, contractual debt repayments and
the cash flow impact of once-off items - is appropriate. This
measure aligns dividend distributions with the cash generation
potential of the business. In proposing a dividend, the board will
also take into account the company’s financial position, future
prospects, satisfactory solvency and liquidity assessments and
other factors deemed relevant at the time. The board also allows
itself flexibility to deviate from the above policy, when deemed
appropriate.
Although cash generated by operating activities for the period
were below expectations, the cash flow generated by the sale of
Uitkomst Colliery and other investments amounted to R148.4 million
and largely constitutes the return to shareholders of the profits
realised on the original investments. Whilst this is a deviation
from the group’s stated dividend policy, the board considered that
the exceptional circumstances warrant the proposed dividend as the
Elikhulu Project debt facility has been closed and sustaining
capital can be funded from operational cash flows at the prevailing
gold price.
Net debt
Total debt facilities utilised at 30 June
2017 amounted to R227.8 million (2016: R392.2 million), and
cash holdings were R160.2 million (2016: R52.6 million), resulting
in a decrease in net debt to R67.6 million (2016: R339.6
million).
The decrease in net debt was predominantly as a result of the
gross proceeds received from the R696 million equity raised on
12 April 2017.
Summary of the long-term debt liabilities:
|
Revolving credit facility |
Evander Mines gold loan |
Total |
30 June
2017 |
30 June
2016 |
30 June
2017 |
30 June
2016 |
30 June
2017 |
30 June
2016 |
|
ZAR
millions |
ZAR
millions |
ZAR
millions |
ZAR
millions |
ZAR
millions |
ZAR
millions |
Non-current
portion |
180.5 |
279.3 |
- |
26.6 |
180.5 |
305.9 |
Current portion |
20.7 |
31.1 |
26.6 |
55.2 |
47.3 |
86.3 |
Total |
201.2 |
310.4 |
26.6 |
81.8 |
227.8 |
392.2 |
The group’s performance against the revolving credit facility
debt covenant limits are summarised below:
|
Measurement |
30 June
2017 |
30 June
2016 |
Description |
Net-debt-to-equity ratio |
Must be less than 1:1 |
0.01 |
0.11 |
Improvement |
Net-debt-to-adjusted EBITDA
ratio |
Must be less than 2.5:1 |
0.05 |
0.38 |
Improvement |
Interest cover ratio |
Must be greater than 4 times |
10 |
26 |
Regression due to reduced profits and
higher interest expense |
Capital expenditure
Group capital expenditure for the 2017 financial year has been
summarised per operation in the table below:
|
Continuing Operations |
Discontinued Operations |
Group Total |
|
Barberton Mines
(Note 1) |
Evander Mines (Note 2) |
Elikhulu |
Corporate |
Phoenix Platinum |
Uitkomst Colliery |
|
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
Development
capital |
65.7 |
79.8 |
- |
|
- |
7.0 |
152.5 |
Maintenance
capital |
50.8 |
118.6 |
- |
1.4 |
3.4 |
3.3 |
177.5 |
Sustaining capital
total |
116.5 |
198.4 |
- |
1.4 |
3.4 |
10.3 |
330.0 |
Expansion capital |
77.0 |
23.8 |
175.5 |
- |
2.0 |
4.8 |
283.1 |
Total capital
expenditure |
193.5 |
222.2 |
175.5 |
1.4 |
5.4 |
15.1 |
613.1 |
Note 1: The R77 million once-off
expansion capital related to the construction of the BTRP
detoxification plant for R17.1 million and the acquisition of
additional tailings resources for R5 million. Barberton Mines
incurred R41.5 million for the construction of the installation of
refrigeration at Fairview, and R13.4 million on development of
Royal Sheba.
Note 2: Evander Mines incurred R15.8
million on 25 A Block and 26 Level decline development, and R8
million on the 2010 Pay Channel project drilling programme. Evander
Mines also incurred an additional R42 million in relation to
maintenance capital following the refurbishment of No 7 Shaft
infrastructure.
Cash flow summary
Cash generated by operations before dividends decreased by
R452.4 million to R339.0 million (2016: R791.4 million), due to
lower gold production following the operational disruptions and
challenges noted previously. Cash generated by operations after
taking into account net dividends paid to shareholders of R232.6
million (2016: R210 million), decreased to R106.5 million (2016:
R581.4 million).
The cash outflows from investing activities was R491 million
(2016: R969 million), predominantly due to:
- Capital expenditure incurred increased to R613.1 million (2016:
R302.4 million), due to the Elikhulu Project and higher once-off
capital expenditure predominantly due to the construction of the
BTRP cyanide detoxification plant and Fairview’s ventilation
refrigeration and infrastructure.
- Proceeds on the sale of a listed investment of R23.4 million,
and proceeds on the sale of property plant and equipment of R7
million at Uitkomst Colliery.
- Inflow of funds of R125 million following the sale of Uitkomst
Colliery, with net proceeds of the disposal being R111.7 million,
net of the cash transferred within the business.
Net cash inflows from financing activities was R493 million
(2016: R375.9 million outflow), predominantly due to:
- The utilisation of the revolving credit facility to fund
operational capital expenditure.
- Share issues resulting in gross proceeds of R696 million, and
R672 million net of share issue costs.
Evander Mines incurred cash outflows of R345.2 million during
the financial year, following the refurbishment of critical shaft
infrastructure which resulted in lower gold production.
The R345.2 million cash outflows is summarised as follows:
- Cash outflows of Evander Mines operations of R116.3
million;
- Cash outflows from investing activities in capital expenditure
(excluding the Elikhulu Project) of R222.2 million, of which R42
million related to the refurbishment of critical No 7 Shaft’s
infrastructure and R180.2 million was normalised operational
capital expenditure;
- Cash outflows from financing activities of R6.7 million.
COMMITMENTS REPORTED IN ZAR AND
GBP
The group identified no contingent liabilities in the current or
prior financial period.
The group had outstanding open orders contracted for at period
end of R1.22 billion (2016: R12.7 million), or GBP72 million (2016: GBP0.6 million). Outstanding orders in the
current reporting period related mostly to the Elikhulu
Project.
Authorised commitments for the 2018 financial period, not yet
contracted for, totalled R328.7 million (2016: R345.9 million) or
GBP19.4 million (2016: GBP17.5 million).
At 30 June 2017, the group had
guarantees in place of R24.6 million (2016: R24.6 million) or
GBP1.4 million (2016: GBP1.2 million) in favour of Eskom Holdings SOC
Limited and R14.0 million (2016: R14.0 million) or GBP0.8 million (2016: GBP1.0 million) in favour of the DMR.
Operating lease commitments, which fall due within the next
financial year, amounted to R2.7 million (2016: R2.9 million) or
GBP0.16 million (2016: GBP0.16 million).
FAIR VALUE INSTRUMENTS
Financial instruments measured at fair value are grouped into
levels 1 to 3 based on the extent to which fair value is
observable.
The levels are classified as follows:
Level 1 - fair value is based on quoted prices in active markets
for identical financial assets or liabilities.
Level 2 - fair value is determined using inputs other than
quoted prices included within level 1 that are observable for the
asset or liability.
Level 3 - fair value is determined on inputs not
based on observable market data.
Level 1 financial instruments:
Pan African Resources hold 261,287,625 shares in Coal of
Africa (9.3% shareholding), which
is fair valued at R127.6 million (GBP7.5
million). The fair value of the listed investment is treated
as Level 1 of the fair value hierarchy, as the share price is
quoted on a stock exchange.
The group’s rehabilitation trust funds are valued at R320.6
million (2016: R321.5 million) or GBP18.9
million (2016: GBP16.2
million), which comprise investments in guaranteed
equity-linked notes, bonds and interest-bearing call accounts.
Level 2 financial instruments:
During the financial year under review, the cost collar referred
to earlier was settled, resulting in no financial exposure to be
fair valued on a mark-to-market basis, whilst in the prior
financial year the cost-collar mark-to-market liability was R117.6
million.
The group’s cash settled share option liability, which is valued
on a mark-to-market basis according to the Pan African Resources
quoted share price, amounted to R46.4 million (2016: R104
million).
Level 3 financial instruments:
The group’s employee share ownership plan (‘ESOP’) liability is
accounted for on a cash settled share option basis and valued on a
mark-to-market basis on the net present value of the discounted
future cash flows applicable to the beneficiaries of the schemes.
The ESOP liability was R1.9 million (2016: R5.6 million).
BASIS OF PREPARATION OF THE FINANCIAL
STATEMENTS AND ACCOUNTING POLICIES
Investors should consider non-Generally Accepted Accounting
Principles ('non-GAAP') financial measures shown in this
provisional announcement in addition to, and not as a substitute
for or as superior to, measures of financial performance reported
in accordance with International Financial Reporting Standards
('IFRS'). The IFRS results reflect all items that affect reported
performance and therefore it is important to consider the IFRS
measures alongside the non-GAAP measures.
The provisional announcement has been prepared using accounting
policies that comply with the IFRS adopted by the European Union
and South Africa, which are
consistent with those applied in the financial statements for the
prior years ended 30 June 2016 and
30 June 2015.
The provisional audited results announcement is only a summary
of the information in the Integrated Annual Report and does not
contain full or complete details. Any investment decision by
investors and/or shareholders should be based on consideration of
the final Integrated Annual Report to be published on the company’s
website as a whole.
JSE LIMITED (‘JSE’) LISTING
The company has a dual primary listing on the JSE in
South Africa and the AIM market
('AIM') of the London Stock Exchange (‘LSE’).
This provisional announcement has been prepared in accordance
with the framework concepts and the measurement and recognition
requirements of IFRS and SAICA Financial Reporting Guides as issued
by the Accounting Practice Committee, and the Financial
Pronouncements as issued by the Financial Reporting Standards
Council, and the minimum information as required by International
Accounting Standards 34: Interim Financial Reporting. The
accounting policies are in terms of IFRS and are consistent with
those applied in the 2016 consolidated financial statements.
The group's South African external auditors, Deloitte &
Touche, have issued their opinions on the consolidated financial
statements and the provisional summarised consolidated financial
statements for the year ended 30 June
2017. The audits were for both the summarised and full set
of financial statements conducted in accordance with International
Standards on Auditing. Deloitte & Touche have expressed
unmodified opinions on the consolidated financial statements and
the provisional summarised consolidated financial statements.
Copies of their audit reports are available for inspection at the
company's registered office. Any reference to future
financial performance included in this provisional report has not
been reviewed or reported on by the group's South African external
auditors.
The auditor’s report does not necessarily report on all of the
information contained in this announcement/financial results.
Shareholders are therefore advised that in order to obtain a full
understanding of the nature of the auditor’s engagement they should
obtain a copy of that report, together with the accompanying
financial information, from the company’s registered office.
These provisional summarised consolidated financial statements
are extracted from the audited consolidated financial statements.
The directors take full responsibility for the preparation of the
provisional summarised audited results and confirm the financial
information and related commentary has been correctly extracted
from the underlying group consolidated financial statements.
AIM LISTING
The financial information for the year ended 30 June 2017 does not constitute statutory
accounts as defined in sections 435(1) and 435(2) of the UK
Companies Act 2006 (‘Companies Act 2006’) but has been derived from
those accounts. Statutory accounts for the year ended 30 June 2016 have been delivered to the Registrar
of Companies and those for 2017 will be delivered following the
company's AGM. Deloitte LLP, the external auditor registered in the
UK, has reported on these accounts for the year ended 30 June 2017.
Deloitte LLP’s report was unqualified, did not include a
reference to any matters to which auditors draw attention by way of
emphasis of matter, and did not contain a statement under section
498(2) or 498(3) of the Companies Act 2006. These statutory
accounts have been prepared in accordance with IFRS and IFRS
Interpretations Committee interpretations adopted for use by the
EU, with those parts of the Companies Act 2006 applicable to
companies reporting under IFRS.
DIRECTORSHIP CHANGES AND DEALINGS
No directorship changes took place during the period under
review. However, the following director dealings in securities took
place:
During the period under review Mr JAJ Loots participated in the
following company shares transactions:
- On 27 September 2016, purchased
20,000 shares and 200,000 shares at R3.57 per share and R3.58 per
share, respectively.
- On 28 September 2016, purchased
28,609 shares at R3.48 per share.
- On 29 September 2016, purchased
491 shares at R3.59 per share.
- On 30 September 2016, purchased
25,000 shares at R3.70 per share.
- On 3 October 2016, purchased
25,000 shares at R3.78 per share.
- On 5 October 2016, purchased
30,000 shares at R3.55 per share.
Mr JAJ Loots had 560,675 shares outstanding at period end,
representing 0.03% of total issued shares.
During the year under review Mr GP Louw participated in the
following company shares transactions.
On 27 September 2016, purchased
the following shares:
- 4,300 shares at R3.57 per share.
- 3,150 shares at R3.58 per share.
- 35,000 shares at R3.62 per share.
- 40,000 shares at R3.64 per share.
- 12,836 shares at R3.66 per share.
- 42,164 shares at R3.67 per share.
Mr GP Louw had 137,450 shares outstanding at period end,
representing 0.01% of total issued shares.
SHARES ISSUED
On 12 April 2017, Pan African
Resources issued 291,480,983 new ordinary shares of 1 pence each at an issue price of 14 pence per share or R2.39 per share, raising
gross proceeds of R696 million (GBP40.8
million).
GOING CONCERN
The group closely monitors and manages its liquidity risk by
means of a centralised treasury function. Cash forecasts are
regularly produced and sensitivities run for different scenarios
including, but not limited to, changes in commodity prices and
different production profiles from the group’s producing assets.
The group had R800 million of available debt liquidity headroom and
R160.2 million in cash and cash equivalents at 30 June 2017, and has also secured a further R1
billion committed term facility to fund the Elikhulu Project. Based
on the current status of the group’s finances, having considered
going concern forecasts and reasonably possible downside scenarios
after considering the principal risks associated with the business,
and in particular relating to gold prices and production volumes,
the group’s forecasts show it will have sufficient liquidity
headroom for the 12 months from the date of approval of the
financial statements to meet all its obligations in the ordinary
course of business.
The board has a reasonable expectation that the company has
adequate resources to continue in operational existence for the
foreseeable future. Accordingly the group continues to adopt the
going concern basis of accounting in preparation of the
30 June 2017 financial
statements.
EVENTS AFTER THE REPORTING PERIOD
The group announced on 31 July
2017 that it will dispose of all of its shares and loan
accounts in Phoenix Platinum Mining to Sylvania for a total cash
consideration of R89 million. The transaction remains subject only
to Competition Commission approval.
SEGMENT REPORTING
A segment is a distinguishable component of the group engaged in
providing products or services in a particular business sector or
segment, which is subject to risks and rewards different from those
of other segments. The group's business activities were conducted
through the following business segments:
Continuing operations:
- Barberton Mines (including BTRP), located in Barberton,
South Africa;
- Evander Mines (including ETRP), located in Evander,
South Africa;
- Corporate; and
- Pan African Resources Funding Company Proprietary Limited
(‘Funding Company’).
Discontinued operations:
- Uitkomst Colliery, located in Newcastle, South
Africa; and
- Phoenix Platinum, located near Rustenburg, South Africa.
The executive committee reviews the operations in accordance
with the disclosures presented above.
PROPOSED DIVIDEND FOR APPROVAL AT THE
AGM
The board has analysed the group performance and dividend policy
and has proposed a final dividend of R185 million or approximately
GBP10.9 million, equating to R0.08279
per share or approximately 0.48697
pence per share. This dividend is subject to approval at the
AGM, which will take place on Tuesday, 21
November 2017.
Assuming the final dividend is approved by shareholders, the
following salient dates would apply:
Currency conversion date |
Tuesday, 21 November 2017 |
Last date to trade on the
exchanges |
Tuesday, 5 December 2017 |
Ex-dividend date on the
JSE |
Wednesday, 6 December 2017 |
Ex-dividend date on the
LSE |
Thursday, 7 December 2017 |
Record date |
Friday, 8 December 2017 |
Payment date |
Thursday, 21 December 2017 |
The GBP proposed final dividend was calculated based on
2,234,687,537 total shares in issue and an illustrative exchange
rate of R17:1. Shareholders on the London register should note that a revised
exchange rate will be communicated prior to approval at the
AGM.
No transfers between the Johannesburg and London registers between the commencement of
trading on Monday, 4 December 2017
and close of business on Friday, 8 December
2017 will be permitted.
No shares may be dematerialised or rematerialised between
Wednesday, 6 December 2017 and
Friday, 8 December 2017, both days
inclusive.
The South African dividends tax rate is 20% per ordinary share
for shareholders who are liable to pay the dividends tax, resulting
in a net dividend of R0.06623 per share for these shareholders.
Foreign investors may qualify for a lower dividend tax rate,
subject to completing a dividend tax declaration and submitting it
to Computershare Investor Services Proprietary Limited or Capita
Plc who manage the SA and UK register, respectively. The company's
South African income tax reference number is 9154588173 and it has
2,234,687,537 shares currently in issue.
Cobus Loots |
Deon Louw |
Chief Executive Officer |
Financial Director |
20 September 2017
Contact details:
Corporate Office |
Registered Office |
The Firs Office Building |
Suite 31 |
1st Floor, Office 101 |
Second Floor |
Cnr. Cradock and Biermann
Avenues |
107 Cheapside |
Rosebank, Johannesburg |
London |
South Africa |
EC2V 6DN |
Office: + 27 (0) 11 243
2900 |
United Kingdom |
Facsimile: + 27 (0) 11 880 1240 |
Office: + 44 (0) 20 7796
8644 |
www.panafricanresources.com |
Facsimile: + 44 (0) 20 7796
8645 |
Cobus Loots |
Deon Louw |
Pan African Resources PLC |
Pan African Resources PLC |
Chief Executive Officer |
Financial Director |
Office: + 27 (0) 11 243 2900 |
Office: + 27 (0) 11 243 2900 |
Phil Dexter |
John Prior / Paul Gillam |
St James's Corporate Services
Limited |
Numis Securities Limited |
Company Secretary |
Nominated Adviser and Joint
Broker |
Office: + 44 (0) 20 7796 8644 |
Office: +44 (0) 20 7260 1000 |
Sholto Simpson |
Ross Allister |
One Capital |
Peel Hunt LLP |
JSE Sponsor |
Joint Broker |
Office: + 27 (0) 11 550 5009 |
Office: +44 (0) 20 7418
8900 |
Julian Gwillim |
Jeffrey Couch / Neil Haycock /
Thomas Rider |
Aprio Strategic Communications |
BMO Capital Markets Limited |
Public & Investor Relations
SA |
Joint Broker |
Office: +27 (0)11 880 0037 |
Office: +44 (0) 20 7236 1010 |
Bobby Morse / Chris Judd
Buchanan Communications
Public & Investor Relations UK
Office: +44 (0) 207 466 5000
Pan African
Resources PLC |
|
|
|
|
|
Summarised consolidated statement of profit or loss and other
comprehensive income for the period ended 30 June 2017 |
|
30
June 2017 |
30 June
2016 |
|
30
June 2017 |
30
June 2016 |
|
(Audited) |
(Audited) |
|
(Unaudited) |
(Unaudited) |
Continuing
operations |
GBP |
GBP |
|
ZAR |
ZAR |
Gold sales |
169,584,586 |
161,312,220 |
|
2,925,334,113 |
3,460,147,123 |
Realisation costs |
(1,826,043) |
(956,709) |
|
(31,499,250) |
(20,521,416) |
On-mine
revenue |
167,758,543 |
160,355,511 |
|
2,893,834,863 |
3,439,625,707 |
Gold cost of
production |
(134,006,583) |
(100,487,340) |
|
(2,311,613,568) |
(2,155,453,481) |
Mining
depreciation |
(10,493,064) |
(9,995,526) |
|
(181,005,351) |
(214,404,023) |
Mining
profit |
23,258,896 |
49,872,645 |
|
401,215,944 |
1,069,768,203 |
Other expenses |
(2,002,545) |
(12,167,011) |
|
(34,543,908) |
(260,982,390) |
Profit on disposal of
investment |
222,571 |
- |
|
4,582,844 |
- |
Profit on disposal of
subsidiary |
5,385,915 |
- |
|
91,345,123 |
- |
Royalty costs |
(1,335,031) |
(2,783,423) |
|
(23,029,288) |
(59,704,418) |
Net income before
finance income and finance costs |
25,529,806 |
34,922,211 |
|
439,570,715 |
749,081,395 |
Finance income |
291,912 |
433,344 |
|
5,035,474 |
9,295,228 |
Finance costs |
(2,815,223) |
(1,448,248) |
|
(48,562,604) |
(31,064,929) |
Profit before
taxation |
23,006,495 |
33,907,307 |
|
396,043,585 |
727,311,694 |
Taxation |
(242,942) |
(8,578,135) |
|
(4,190,728) |
(184,000,970) |
Profit after
taxation from continuing operations |
22,763,553 |
25,329,172 |
|
391,852,857 |
543,310,724 |
Discontinued
operations |
|
|
|
|
|
(Loss)/profit for the
period from discontinued operations (including impairments) |
(4,853,517) |
172,645 |
|
(81,997,446) |
3,703,294 |
Profit after
taxation |
17,910,036 |
25,501,817 |
|
309,855,411 |
547,014,018 |
Other comprehensive
income: |
|
|
|
|
|
Fair-value movement on
available-for-sale investment |
(94,938) |
388,188 |
|
(1,697,487) |
7,644,429 |
Recycling of gain on
available-for-sale investment |
(222,571) |
- |
|
(4,582,845) |
- |
Foreign currency
translation differences |
21,681,108 |
(2,181,333) |
|
- |
- |
Total comprehensive
income for the year |
39,273,635 |
23,708,672 |
|
303,575,079 |
554,658,447 |
Profit attributable
to: |
|
|
|
|
|
Owners of the
parent |
17,910,036 |
25,501,817 |
|
309,855,411 |
547,014,018 |
|
|
|
|
|
|
Total comprehensive
income attributable to: |
|
|
|
|
|
Owners of the
parent |
39,273,635 |
23,708,672 |
|
303,575,079 |
554,658,447 |
Earnings per share |
1.14 |
1.41 |
|
19.81 |
30.20 |
Diluted earnings per
share |
1.14 |
1.41 |
|
19.80 |
30.09 |
Weighted average number
of shares in issue |
1,564,346,115 |
1,811,427,377 |
|
1,564,346,115 |
1,811,427,377 |
Diluted number of
shares in issue |
1,565,075,434 |
1,811,916,935 |
|
1,565,075,434 |
1,811,916,935 |
|
|
|
|
|
|
|
|
|
|
|
|
Pan African
Resources PLC |
|
|
|
|
|
Summarised consolidated statement of profit or loss and other
comprehensive income for the period ended 30 June 2017 |
|
30
June 2017 |
30 June
2016 |
|
30
June 2017 |
30
June 2016 |
|
(Audited) |
(Audited) |
|
(Unaudited) |
(Unaudited) |
Continuing
operations |
GBP |
GBP |
|
ZAR |
ZAR |
Gold sales |
169,584,586 |
161,312,220 |
|
2,925,334,113 |
3,460,147,123 |
Realisation costs |
(1,826,043) |
(956,709) |
|
(31,499,250) |
(20,521,416) |
On-mine
revenue |
167,758,543 |
160,355,511 |
|
2,893,834,863 |
3,439,625,707 |
Gold cost of
production |
(134,006,583) |
(100,487,340) |
|
(2,311,613,568) |
(2,155,453,481) |
Mining
depreciation |
(10,493,064) |
(9,995,526) |
|
(181,005,351) |
(214,404,023) |
Mining
profit |
23,258,896 |
49,872,645 |
|
401,215,944 |
1,069,768,203 |
Other expenses |
(2,002,545) |
(12,167,011) |
|
(34,543,908) |
(260,982,390) |
Profit on disposal of
investment |
222,571 |
- |
|
4,582,844 |
- |
Profit on disposal of
subsidiary |
5,385,915 |
- |
|
91,345,123 |
- |
Royalty costs |
(1,335,031) |
(2,783,423) |
|
(23,029,288) |
(59,704,418) |
Net income before
finance income and finance costs |
25,529,806 |
34,922,211 |
|
439,570,715 |
749,081,395 |
Finance income |
291,912 |
433,344 |
|
5,035,474 |
9,295,228 |
Finance costs |
(2,815,223) |
(1,448,248) |
|
(48,562,604) |
(31,064,929) |
Profit before
taxation |
23,006,495 |
33,907,307 |
|
396,043,585 |
727,311,694 |
Taxation |
(242,942) |
(8,578,135) |
|
(4,190,728) |
(184,000,970) |
Profit after
taxation from continuing operations |
22,763,553 |
25,329,172 |
|
391,852,857 |
543,310,724 |
Discontinued
operations |
|
|
|
|
|
(Loss)/profit for the
period from discontinued operations (including impairments) |
(4,853,517) |
172,645 |
|
(81,997,446) |
3,703,294 |
Profit after
taxation |
17,910,036 |
25,501,817 |
|
309,855,411 |
547,014,018 |
Other comprehensive
income: |
|
|
|
|
|
Fair-value movement on
available-for-sale investment |
(94,938) |
388,188 |
|
(1,697,487) |
7,644,429 |
Recycling of gain on
available-for-sale investment |
(222,571) |
- |
|
(4,582,845) |
- |
Foreign currency
translation differences |
21,681,108 |
(2,181,333) |
|
- |
- |
Total comprehensive
income for the year |
39,273,635 |
23,708,672 |
|
303,575,079 |
554,658,447 |
Profit attributable
to: |
|
|
|
|
|
Owners of the
parent |
17,910,036 |
25,501,817 |
|
309,855,411 |
547,014,018 |
|
|
|
|
|
|
Total comprehensive
income attributable to: |
|
|
|
|
|
Owners of the
parent |
39,273,635 |
23,708,672 |
|
303,575,079 |
554,658,447 |
Earnings per share |
1.14 |
1.41 |
|
19.81 |
30.20 |
Diluted earnings per
share |
1.14 |
1.41 |
|
19.80 |
30.09 |
Weighted average number
of shares in issue |
1,564,346,115 |
1,811,427,377 |
|
1,564,346,115 |
1,811,427,377 |
Diluted number of
shares in issue |
1,565,075,434 |
1,811,916,935 |
|
1,565,075,434 |
1,811,916,935 |
|
|
|
|
|
|
Summarised consolidated statement of
financial position as at 30 June
2017
|
|
|
|
|
|
|
|
|
30 June
2017 |
30 June
2016 |
|
30 June
2017 |
30 June
2016 |
|
|
(Audited) |
(Audited) |
|
(Unaudited) |
(Unaudited) |
|
|
GBP |
GBP |
|
ZAR |
ZAR |
ASSETS |
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
|
Property, plant and equipment and
mineral rights |
|
224,687,447 |
190,725,199 |
|
3,810,699,097 |
3,772,544,439 |
Other intangible assets |
|
72,426 |
123,235 |
|
1,228,340 |
2,437,592 |
Deferred taxation |
|
762,503 |
1,117,092 |
|
12,932,051 |
22,096,084 |
Long-term inventory |
|
684,432 |
186,861 |
|
11,607,974 |
3,696,114 |
Long-term receivables |
|
2,535,378 |
- |
|
43,000,000 |
- |
Goodwill |
|
21,000,714 |
21,000,714 |
|
303,491,812 |
303,491,812 |
Investments |
|
7,522,632 |
1,269,228 |
|
127,583,839 |
25,105,331 |
Rehabilitation trust fund |
|
18,904,554 |
16,253,708 |
|
320,621,235 |
321,498,339 |
|
|
276,170,086 |
230,676,037 |
|
4,631,164,348 |
4,450,869,711 |
Current assets |
|
|
|
|
|
|
Inventories |
|
5,047,416 |
4,398,813 |
|
85,604,171 |
87,008,537 |
Current tax asset |
|
1,068,496 |
848,946 |
|
18,121,694 |
16,792,156 |
Trade and other receivables |
|
13,744,108 |
14,042,357 |
|
233,100,052 |
277,757,811 |
Cash and cash equivalents |
|
9,447,144 |
2,658,947 |
|
160,223,562 |
52,593,979 |
|
|
29,307,164 |
21,949,063 |
|
497,049,479 |
434,152,483 |
Assets held-for-sale |
|
5,610,475 |
66,873 |
|
95,153,662 |
1,322,750 |
TOTAL ASSETS |
|
311,087,725 |
252,691,973 |
|
5,223,367,489 |
4,886,344,944 |
|
|
|
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
Capital and reserves |
|
|
|
|
|
|
Share capital |
|
22,346,875 |
19,432,065 |
|
318,766,602 |
269,660,040 |
Share premium |
|
145,400,890 |
108,936,082 |
|
2,261,421,031 |
1,638,563,371 |
Translation reserve |
|
(36,902,740) |
(58,583,848) |
|
- |
- |
Share option reserve |
|
1,221,395 |
1,035,888 |
|
17,157,178 |
13,957,178 |
Retained earnings |
|
131,297,799 |
126,620,650 |
|
1,867,141,585 |
1,789,877,978 |
Realisation of equity reserve |
|
(10,701,093) |
(10,701,093) |
|
(140,624,131) |
(140,624,130) |
Treasury capital reserve |
|
(25,376,743) |
(25,376,743) |
|
(548,619,802) |
(548,619,802) |
Merger reserve |
|
(10,705,308) |
(10,705,308) |
|
(154,707,759) |
(154,707,759) |
Other reserves |
|
- |
317,509 |
|
- |
6,280,332 |
Equity attributable to owners of the
parent |
|
216,581,075 |
150,975,202 |
|
3,620,534,704 |
2,874,387,208 |
Total equity |
|
216,581,075 |
150,975,202 |
|
3,620,534,704 |
2,874,387,208 |
Non-current liabilities |
|
|
|
|
|
|
Long-term provisions |
|
11,655,325 |
10,432,986 |
|
197,674,310 |
206,364,460 |
Long-term liabilities |
|
12,290,302 |
18,456,309 |
|
208,443,509 |
362,640,753 |
Deferred taxation |
|
38,947,226 |
40,616,337 |
|
660,544,960 |
803,391,140 |
|
|
62,892,853 |
69,505,632 |
|
1,066,662,779 |
1,372,396,353 |
Current liabilities |
|
|
|
|
|
|
Trade and other payables |
|
27,056,598 |
18,743,235 |
|
458,879,917 |
370,741,187 |
Financial instrument liabilities |
|
- |
5,945,399 |
|
- |
117,600,000 |
Current portion of long-term
liabilities |
|
4,145,679 |
6,980,711 |
|
70,310,720 |
140,503,506 |
Current tax liability |
|
48,686 |
541,794 |
|
825,707 |
10,716,690 |
|
|
31,250,963 |
32,211,139 |
|
530,016,344 |
639,561,383 |
|
|
|
|
|
|
|
Liabilities directly associated with
assets held-for-sale |
|
362,834 |
- |
|
6,153,662 |
- |
TOTAL EQUITY AND
LIABILITIES |
|
311,087,725 |
252,691,973 |
|
5,223,367,489 |
4,886,344,944 |
Summarised unaudited consolidated
statement of changes in equity for the year ended 30 June 2017
|
|
|
|
|
|
GROUP |
Share capital |
Share premium |
Translation reserve |
Share option reserve |
Retained earnings |
|
GBP |
GBP |
GBP |
GBP |
GBP |
Balance at 30
June 2015 |
18,314,947 |
94,846,046 |
(56,402,515) |
1,035,888 |
110,850,201 |
Issue of shares |
1,117,118 |
15,011,206 |
- |
- |
- |
Share issue costs |
- |
(921,170) |
- |
- |
- |
Profit for the
year |
- |
- |
- |
- |
25,501,817 |
Total other
comprehensive income |
- |
- |
(2,181,333) |
- |
- |
Dividends paid |
- |
- |
- |
- |
(9,731,368) |
Share buyback |
- |
- |
- |
- |
- |
Balance at 30 June
2016 |
19,432,065 |
108,936,082 |
(58,583,848) |
1,035,888 |
126,620,650 |
Issue of shares |
2,914,810 |
37,892,528 |
- |
- |
- |
Share issue costs |
- |
(1,427,720) |
- |
- |
- |
Profit for the
year |
- |
- |
- |
- |
17,910,036 |
Total other
comprehensive income |
- |
- |
21,681,108 |
- |
- |
Dividends paid |
- |
- |
- |
- |
(17,067,953) |
Reciprocal
dividends |
- |
- |
- |
- |
3,835,066 |
Share based payment -
charge for the year |
- |
- |
- |
185,507 |
- |
Balance at 30 June
2017 |
22,346,875 |
145,400,890 |
(36,902,740) |
1,221,395 |
131,297,799 |
|
|
|
|
|
|
Summarised unaudited consolidated
statement of changes in equity for the year ended 30 June 2017
|
|
|
|
|
|
Group |
Share Capital |
Share Premium |
Translation reserve |
Share option reserve |
Retained earnings |
|
ZAR |
ZAR |
ZAR |
ZAR |
ZAR |
Balance at 30 June
2015 |
244,752,779 |
1,323,632,626 |
- |
13,957,178 |
1,452,863,960 |
Issue of shares |
24,907,261 |
334,689,839 |
- |
- |
- |
Share issue costs |
- |
(19,759,094) |
- |
- |
- |
Profit for the
year |
- |
- |
- |
- |
547,014,018 |
Total other
comprehensive income |
- |
- |
- |
- |
- |
Dividends paid |
- |
- |
- |
- |
(210,000,000) |
Share buyback |
- |
- |
- |
- |
- |
Balance at 30 June
2016 |
269,660,040 |
1,638,563,371 |
- |
13,957,178 |
1,789,877,978 |
Issue of shares |
49,106,562 |
646,861,194 |
- |
- |
- |
Share issue costs |
- |
(24,003,534) |
- |
- |
- |
Profit for the
year |
- |
- |
- |
- |
309,855,411 |
Total other
comprehensive income |
- |
- |
- |
- |
- |
Dividends paid |
- |
- |
- |
- |
(300,000,000) |
Reciprocal
dividends |
- |
- |
- |
- |
67,408,196 |
Share based payment -
charge for the year |
- |
- |
- |
3,200,000 |
- |
Balance at 30 June
2017 |
318,766,602 |
2,261,421,031 |
- |
17,157,178 |
1,867,141,585 |
GROUP |
Realisation of equity reserve |
Treasury capital reserve |
Merger reserve |
Other reserves |
Total |
|
GBP |
GBP |
GBP |
GBP |
GBP |
Balance at 30
June 2015 |
(10,701,093) |
- |
(10,705,308) |
(70,679) |
147,167,487 |
Issue of shares |
- |
- |
- |
- |
16,128,324 |
Share issue costs |
- |
- |
- |
- |
(921,170) |
Profit for the
year |
- |
- |
- |
- |
25,501,817 |
Total other
comprehensive income |
- |
- |
- |
388,188 |
(1,793,145) |
Dividends paid |
- |
- |
- |
- |
(9,731,368) |
Share buyback |
- |
(25,376,743) |
- |
- |
(25,376,743) |
Balance at 30 June
2016 |
(10,701,093) |
(25,376,743) |
(10,705,308) |
317,509 |
150,975,202 |
Issue of shares |
- |
- |
- |
- |
40,807,338 |
Share issue costs |
- |
- |
- |
- |
(1,427,720) |
Profit for the
year |
- |
- |
- |
- |
17,910,036 |
Total other
comprehensive income |
- |
- |
- |
(317,509) |
21,363,599 |
Dividends paid |
- |
- |
- |
- |
(17,067,953) |
Reciprocal
dividends |
- |
- |
- |
- |
3,835,066 |
Share based payment -
charge for the year |
- |
- |
- |
- |
185,507 |
Balance at 30 June
2017 |
(10,701,093) |
(25,376,743) |
(10,705,308) |
- |
216,581,075 |
|
|
|
|
|
|
Summarised unaudited consolidated
statement of changes in equity for the year ended 30 June 2017
|
|
|
|
|
|
Group |
Realisation of equity reserve |
Treasury capital reserve |
Merger reserve |
Other reserves |
Total |
|
ZAR |
ZAR |
ZAR |
ZAR |
ZAR |
Balance at 30 June
2015 |
(140,624,130) |
- |
(154,707,759) |
(1,364,097) |
2,738,510,557 |
Issue of shares |
- |
- |
- |
- |
359,597,100 |
Share issue costs |
- |
- |
- |
- |
(19,759,094) |
Profit for the
year |
- |
- |
- |
- |
547,014,018 |
Total other
comprehensive income |
- |
- |
- |
7,644,429 |
7,644,429 |
Dividends paid |
- |
- |
- |
- |
(210,000,000) |
Share buyback |
- |
(548,619,802) |
- |
- |
(548,619,802) |
Balance at 30 June
2016 |
(140,624,130) |
(548,619,802) |
(154,707,759) |
6,280,332 |
2,874,387,208 |
Issue of shares |
- |
- |
- |
- |
695,967,756 |
Share issue costs |
- |
- |
- |
- |
(24,003,534) |
Profit for the
year |
- |
- |
- |
- |
309,855,411 |
Total other
comprehensive income |
- |
- |
- |
(6,280,332) |
(6,280,332) |
Dividends paid |
- |
- |
- |
- |
(300,000,000) |
Reciprocal
dividends |
- |
- |
- |
- |
67,408,196 |
Share based payment -
charge for the year |
- |
- |
- |
- |
3,200,000 |
Balance at 30 June
2017 |
(140,624,130) |
(548,619,802) |
(154,707,759) |
- |
3,620,534,705 |
Summarised consolidated statement of cash flows for the year
ended 30 June 2017 |
|
|
|
|
|
30
June 2017 |
30
June 2016 |
|
30
June 2017 |
30
June 2016 |
|
(Audited) |
(Audited) |
|
(Unaudited) |
(Unaudited) |
|
GBP |
GBP |
|
ZAR |
ZAR |
NET CASH GENERATED
FROM OPERATIONS |
29,945,218 |
51,056,970 |
|
516,393,818 |
1,082,923,023 |
Income taxes paid |
(6,324,864) |
(9,998,969) |
|
(105,790,084) |
(208,209,553) |
Royalties paid |
(1,678,474) |
(2,916,283) |
|
(28,283,550) |
(61,423,325) |
Net finance costs |
(2,141,151) |
(652,680) |
|
(43,272,552) |
(21,866,695) |
NET CASH GENERATED
FROM OPERATIONS AFTER TAX, ROYALTIES AND FINANCE COSTS |
19,800,729 |
37,489,038 |
|
339,047,632 |
791,423,450 |
Dividends paid net of
PAR Gold reciprocal dividend |
(13,290,429) |
(9,024,833) |
|
(232,591,804) |
(210,000,000) |
NET CASH GENERATED
FROM OPERATING ACTIVITIES |
6,510,300 |
28,464,205 |
|
106,455,828 |
581,423,450 |
|
|
|
|
|
|
INVESTING
ACTIVITIES |
|
|
|
|
|
Additions to property,
plant and equipment and mineral rights |
(35,518,177) |
(14,079,918) |
|
(612,688,544) |
(302,014,225) |
Additions to other
intangible assets |
(22,817) |
(17,248) |
|
(393,593) |
(369,970) |
Proceeds on disposal
of investment |
1,381,005 |
- |
|
23,407,843 |
- |
Proceeds on disposal
of property, plant and equipment |
396,604 |
14,620 |
|
7,000,000 |
313,600 |
Proceeds on disposal
of Uitkomst Colliery net of cash |
6,586,262 |
- |
|
111,702,967 |
- |
Acquisition of
Uitkomst Colliery |
- |
(5,700,402) |
|
- |
(120,013,429) |
Shanduka Gold
Proprietary Limited transaction |
- |
(25,299,095) |
|
- |
(546,941,145) |
Increase in long
term-loans receivable |
(1,207,492) |
- |
|
(20,000,000) |
- |
NET CASH USED IN
INVESTING ACTIVITIES |
(28,384,615) |
(45,082,043) |
|
(490,971,327) |
(969,025,169) |
|
|
|
|
|
|
FINANCING
ACTIVITIES |
|
|
|
|
|
Proceeds from
borrowings |
47,750,265 |
38,061,147 |
|
817,000,000 |
840,000,000 |
Borrowings repaid |
(53,964,004) |
(38,131,957) |
|
(915,000,000) |
(803,889,110) |
Settlement of cash
settled share option costs |
(3,299,545) |
- |
|
(58,013,879) |
- |
Shares issued |
40,807,338 |
16,128,324 |
|
695,967,756 |
359,597,100 |
Share issue costs |
(1,427,720) |
(921,170) |
|
(24,003,534) |
(19,759,094) |
Repayment of financial
instruments |
(1,389,720) |
- |
|
(22,924,978) |
- |
NET CASH FROM
FINANCING ACTIVITIES |
28,476,614 |
15,136,344 |
|
493,025,365 |
375,948,896 |
|
|
|
|
|
|
NET
INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS |
6,602,297 |
(1,481,494) |
|
108,509,866 |
(11,652,823) |
Cash and cash
equivalents at the beginning of the year |
2,658,947 |
3,328,850 |
|
52,593,979 |
64,246,802 |
Cash and cash
equivalents attributed to discontinued operations |
(51,903) |
- |
|
(880,283) |
- |
Effect of foreign
exchange rate changes |
237,801 |
811,591 |
|
- |
- |
CASH AND CASH
EQUIVALENTS AT THE END OF THE YEAR |
9,447,144 |
2,658,947 |
|
160,223,562 |
52,593,979 |
Summarised audited consolidated
segment report for the year ended 30 June
2017
|
30 June 2017 |
|
Continuing operations |
Discontinued operations |
|
Barberton
Mines |
Evander
Mines |
Corporate |
Funding
Company |
Uitkomst
Colliery
(Note 3) |
Phoenix
Platinum
(Note 4) |
Reclass
journal |
Group |
|
GBP |
GBP |
GBP |
GBP |
GBP |
GBP |
GBP |
GBP |
Revenue |
|
|
|
|
|
|
|
|
Gold sales (Note 1) |
97,343,927 |
72,240,659 |
- |
- |
- |
- |
- |
169,584,586 |
Platinum sales |
- |
- |
- |
- |
- |
4,766,689 |
(4,766,689) |
- |
Coal sales |
- |
- |
- |
- |
25,089,705 |
- |
(25,089,705) |
- |
Realisation costs |
(606,367) |
(1,219,676) |
- |
- |
- |
- |
- |
(1,826,043) |
On - mine revenue |
96,737,560 |
71,020,983 |
- |
- |
25,089,705 |
4,766,689 |
(29,856,394) |
167,758,543 |
Gold cost of production |
(61,229,000) |
(72,777,583) |
- |
- |
- |
- |
- |
(134,006,583) |
Platinum cost of production |
- |
- |
- |
- |
- |
(5,007,705) |
5,007,705 |
- |
Coal cost of production |
- |
- |
- |
- |
(21,741,484) |
- |
21,741,484 |
- |
Depreciation |
(4,749,422) |
(5,743,642) |
- |
- |
(706,407) |
(870,020) |
1,576,427 |
(10,493,064) |
Mining profit |
30,759,138 |
(7,500,242) |
- |
- |
2,641,814 |
(1,111,036) |
(1,530,778) |
23,258,896 |
Other income/(expenses) (Note 2) |
4,705,042 |
(1,255,689) |
(5,542,295) |
90,397 |
156,333 |
(117,318) |
(39,015) |
(2,002,545) |
Profit on disposal of investment |
- |
- |
222,571 |
- |
- |
- |
- |
222,571 |
Profit on disposal of subsidiary |
- |
- |
5,385,915 |
- |
- |
- |
- |
5,385,915 |
Impairment costs |
- |
- |
- |
- |
- |
(5,950,757) |
5,950,757 |
- |
Royalty costs |
(1,015,352) |
(319,679) |
- |
- |
(70,218) |
- |
70,218 |
(1,335,031) |
Net income / (loss) before finance
income and finance costs |
34,448,828 |
(9,075,610) |
66,191 |
90,397 |
2,727,929 |
(7,179,111) |
4,451,182 |
25,529,806 |
Finance income |
9,949 |
51,811 |
51,496 |
178,656 |
102,850 |
180.0 |
(103,030) |
291,912 |
Finance costs |
(18,652) |
(12,244) |
(14,202) |
(2,770,125) |
- |
- |
- |
(2,815,223) |
Profit /(loss) before taxation and
inter-company charges from continuing operations |
34,440,125 |
(9,036,043) |
103,485 |
(2,501,072) |
2,830,779 |
(7,178,931) |
4,348,152 |
23,006,495 |
Taxation |
(5,654,821) |
6,006,087 |
(531,248) |
(62,960) |
(782,022) |
276,657 |
505,365 |
(242,942) |
Profit /(loss) after taxation from
continuing operations before inter-company charges |
28,785,304 |
(3,029,956) |
(427,763) |
(2,564,032) |
2,048,757 |
(6,902,274) |
4,853,517 |
22,763,553 |
Loss/(profit) after taxation from
discontinued operations |
- |
- |
- |
- |
- |
- |
(4,853,517) |
(4,853,517) |
Profit /(loss) after
taxation before inter-company charges after discontinued
operations |
28,785,304 |
(3,029,956) |
(427,763) |
(2,564,032) |
2,048,757 |
(6,902,274) |
- |
17,910,036 |
|
|
|
|
|
|
|
|
|
Inter-company
transactions |
|
|
|
|
|
|
|
|
Management fees |
(2,805,797) |
(2,075,362) |
5,673,540 |
(92,522) |
(438,989) |
(260,870) |
- |
- |
inter-company interest charges |
(760,141) |
(1,513,938) |
(654,122) |
2,778,372 |
28,225 |
121,604 |
- |
- |
Profit /(loss) after taxation
after inter-company charges after discontinued operations |
25,219,366 |
(6,619,256) |
4,591,655 |
121,818 |
1,637,993 |
(7,041,540) |
- |
17,910,036 |
Segmental assets (total assets
excluding goodwill) |
73,762,949 |
190,009,717 |
19,611,819 |
1,092,051 |
- |
5,610,475 |
- |
290,087,011 |
Segmental liabilities |
25,157,858 |
52,481,513 |
4,589,589 |
11,914,856 |
- |
362,834 |
- |
94,506,650 |
Goodwill |
21,000,714 |
- |
- |
- |
- |
- |
- |
21,000,714 |
Net assets (excluding
goodwill) |
48,605,091 |
137,528,204 |
15,022,230 |
(10,822,805) |
- |
5,247,641 |
- |
195,580,361 |
Capital expenditure |
11,216,853 |
23,054,756 |
79,285 |
- |
875,298 |
314,802 |
- |
35,540,994 |
Adjusted EBITDA |
39,198,250 |
(3,331,968) |
(5,542,295) |
90,397 |
3,434,336 |
(358,334) |
(3,076,002) |
30,414,384 |
Note 1: All gold sales were made in the Republic of South Africa and the majority of revenue was
generated from selling gold to South African institutions through
the group's Funding Company.
Note 2: Other expenses exclude inter-management fees and
dividend received.
Note 3: Uitkomst Colliery disposal was effective on 30 June 2017. The disposal of Pan African
Resources Coal Holdings Proprietary Limited and Uitkomst Colliery
was completed on 30 June 2017 and
this business was classified as a discontinued operation.
Note 4: Phoenix Platinum was classified as held for sale and as
a discontinued operation at 30 June
2017.
|
|
30 June 2016 |
|
Continuing operations |
Discontinued operations |
|
|
Group |
Barberton
Mines |
Evander
Mines |
Corporate |
Funding
Company |
Phoenix
Platinum |
Uitkomst
Colliery |
Reclass
journal |
Group |
|
GBP |
GBP |
GBP |
GBP |
GBP |
GBP |
GBP |
GBP |
GBP |
Revenue |
|
|
|
|
|
|
|
|
|
Gold sales (Note 1) |
169,584,586 |
89,596,245 |
71,715,975 |
- |
- |
- |
- |
- |
161,312,220 |
Platinum sales |
- |
- |
- |
- |
- |
3,480,338 |
- |
(3,480,338) |
- |
Coal sales |
- |
- |
- |
- |
- |
- |
4,567,974 |
(4,567,974) |
- |
Realisation costs |
(1,826,043) |
(398,937) |
(557,772) |
- |
- |
- |
- |
- |
(956,709) |
On - mine revenue |
167,758,543 |
89,197,308 |
71,158,203 |
- |
- |
3,480,338 |
4,567,974 |
(8,048,312) |
160,355,511 |
Gold cost of production |
(134,006,583) |
(45,461,824) |
(55,025,516) |
- |
- |
- |
- |
- |
(100,487,340) |
Platinum cost of production |
- |
- |
- |
- |
- |
(3,456,007) |
- |
3,456,007 |
- |
Coal cost of production |
- |
- |
- |
- |
- |
- |
(4,279,735) |
4,279,735 |
- |
Depreciation |
(10,493,064) |
(3,562,121) |
(6,433,405) |
- |
- |
(311,870) |
(148,733) |
460,603 |
(9,995,526) |
Mining profit |
23,258,896 |
40,173,363 |
9,699,282 |
- |
- |
(287,539) |
139,506 |
148,033 |
49,872,645 |
Other income/(expenses) (Note 2) |
(2,002,545) |
(7,253,912) |
873,481 |
(5,867,355) |
80,775 |
(249,773) |
233,889 |
15,884 |
(12,167,011) |
Profit on disposal of investment |
222,571 |
- |
- |
- |
- |
- |
- |
- |
- |
Profit on disposal of subsidiary |
5,385,915 |
- |
- |
- |
- |
- |
- |
- |
- |
Impairment costs |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Royalty costs |
(1,335,031) |
(2,450,505) |
(332,918) |
- |
- |
- |
(16,524) |
16,524 |
(2,783,423) |
Net income / (loss) before finance
income and finance costs |
25,529,806 |
30,468,946 |
10,239,845 |
(5,867,355) |
80,775 |
(537,312) |
356,871 |
180,441 |
34,922,211 |
Finance income |
291,912 |
13,380 |
27,840 |
79,754 |
312,370 |
448 |
8,824 |
(9,272) |
433,344 |
Finance costs |
(2,815,223) |
(6,048) |
(7,383) |
(7) |
(1,434,811) |
(489) |
- |
489 |
(1,448,249) |
Profit /(loss) before taxation and
inter-company charges from continuing operations |
23,006,495 |
30,476,278 |
10,260,302 |
(5,787,608) |
(1,041,666) |
(537,353) |
365,695 |
171,658 |
33,907,306 |
Taxation |
(242,942) |
(8,492,721) |
(757,683) |
701,414 |
(29,144) |
118,266 |
226,037 |
(344,303) |
(8,578,134) |
Profit /(loss) after taxation from
continuing operations before inter-company charges |
22,763,553 |
21,983,557 |
9,502,619 |
(5,086,194) |
(1,070,810) |
(419,087) |
591,732 |
(172,645) |
25,329,172 |
Loss/(profit) after taxation from
discontinued operations |
(4,853,517) |
- |
- |
- |
- |
- |
- |
172,645 |
172,645 |
Profit /(loss) after
taxation before inter-company charges after discontinued
operations |
17,910,036 |
21,983,557 |
9,502,619 |
(5,086,194) |
(29,144) |
(419,087) |
591,732 |
- |
25,501,817 |
|
|
|
|
|
|
|
|
|
|
Inter-company
transactions |
|
|
|
|
|
|
|
|
|
Management fees |
- |
(1,439,394) |
(1,137,529) |
2,749,883 |
- |
(107,226) |
(65,734) |
- |
- |
inter-company interest charges |
- |
(331,029) |
(750,800) |
(135,868) |
1,130,359 |
79,849 |
7,489 |
- |
- |
Profit /(loss) after taxation
after inter-company charges after discontinued operations |
17,910,036 |
20,213,134 |
7,614,290 |
(2,472,194) |
59,549 |
(446,464) |
533,502 |
- |
25,501,817 |
Segmental assets (total assets
excluding goodwill) |
290,087,011 |
56,651,503 |
146,201,423 |
3,180,048 |
632,954 |
9,991,120 |
15,034,211 |
- |
231,691,259 |
Segmental liabilities |
94,506,650 |
27,035,796 |
48,372,120 |
5,154,888 |
15,725,303 |
883,249 |
4,545,415 |
- |
101,716,771 |
Goodwill |
21,000,714 |
21,000,714 |
- |
- |
- |
- |
- |
- |
21,000,714 |
Net assets (excluding
goodwill) |
195,580,361 |
29,615,707 |
97,829,303 |
(1,974,840) |
(15,092,349) |
9,107,871 |
10,488,796 |
- |
129,974,488 |
Capital expenditure |
35,540,994 |
6,513,408 |
7,179,831 |
46,950 |
- |
316,726 |
40,251 |
- |
14,097,166 |
Adjusted EBITDA |
30,414,384 |
34,031,067 |
16,673,250 |
(5,867,355) |
80,775 |
(225,442) |
505,604 |
(280,162) |
44,917,737 |
Note 2: Other expenses exclude inter-management fees and
dividend received.
Note 3: Uitkomst Colliery disposal was effective on 30 June 2017. The disposal of Pan African
Resources Coal Holdings Proprietary Limited and Uitkomst Colliery
was completed on 30 June 2017 and
this business was classified as a discontinued operation.
Note 4: Phoenix Platinum was classified as held for sale and as
a discontinued operation at 30 June
2017.
Summarised unaudited consolidated ZAR
segment report for the year ended 30 June
2017
|
30 June 2017 |
Continuing operations |
Discontinued operations |
|
Barberton
Mines |
Evander
Mines |
Corporate |
Funding
Company |
Uitkomst
Colliery
(Note 3) |
Phoenix Platinum
(Note 4) |
Reclass
journal |
Group |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
Revenue |
|
|
|
|
|
|
|
|
Gold sales (Note 1) |
1,679.2 |
1,246.1 |
- |
- |
- |
- |
- |
2,925.3 |
Platinum sales |
- |
- |
- |
- |
- |
82.2 |
(82.2) |
- |
Coal sales |
- |
- |
- |
- |
432.8 |
|
(432.8) |
- |
Realisation costs |
(10.5) |
(21.0) |
- |
- |
- |
- |
- |
(31.5) |
On - mine revenue |
1,668.7 |
1,225.1 |
- |
- |
432.8 |
82.2 |
(515.0) |
2,893.8 |
Gold cost of production |
(1,056.2) |
(1,255.4) |
- |
- |
- |
- |
- |
(2,311.6) |
Platinum cost of production |
- |
- |
- |
- |
|
(86.4) |
86.4 |
- |
Coal cost of production |
- |
- |
- |
- |
(375.0) |
- |
375.0 |
- |
Depreciation |
(81.9) |
(99.1) |
- |
- |
(12.2) |
(15.0) |
27.2 |
(181.0) |
Mining Profit |
530.6 |
(129.4) |
- |
- |
45.6 |
(19.2) |
(26.4) |
401.2 |
Other income/(expenses) (Note 2) |
81.3 |
(21.8) |
(95.6) |
1.6 |
2.7 |
(2.0) |
(0.7) |
(34.5) |
Profit on disposal of investment |
- |
- |
4.6 |
- |
- |
- |
- |
4.6 |
Profit on disposal of subsidiary |
- |
- |
91.3 |
|
- |
- |
- |
91.3 |
Impairment costs |
- |
- |
- |
- |
- |
(100.9) |
100.9 |
- |
Royalty costs |
(17.5) |
(5.5) |
- |
- |
(1.2) |
- |
1.2 |
(23.0) |
Net income / (loss) before finance
income and finance costs |
594.4 |
(156.7) |
0.3 |
1.6 |
47.1 |
(122.1) |
75.0 |
439.6 |
Finance income |
0.1 |
0.9 |
0.9 |
3.1 |
1.8 |
- |
(1.8) |
5.0 |
Finance costs |
(0.4) |
(0.2) |
(0.2) |
(47.8) |
- |
- |
- |
(48.6) |
Profit /(loss) before taxation
and inter-company charges |
594.1 |
(156.0) |
1.0 |
(43.1) |
48.9 |
(122.1) |
73.2 |
396.0 |
Taxation |
(97.5) |
103.6 |
(9.2) |
(1.1) |
(13.5) |
4.8 |
8.7 |
(4.2) |
Profit /(loss) after taxation
before inter-company charges |
496.6 |
(52.4) |
(8.2) |
(44.2) |
35.4 |
(117.3) |
81.9 |
391.8 |
(Loss)/profit after taxation from
discontinued operations |
- |
- |
- |
- |
- |
- |
(81.9) |
(81.9) |
Profit /(loss) after
taxation before inter-company charges after discontinued
operations |
496.6 |
(52.4) |
(8.2) |
(44.2) |
35.4 |
(117.3) |
- |
309.9 |
Inter-company
transactions |
|
|
|
|
|
|
|
|
Management fees |
(48.4) |
(35.8) |
97.9 |
(1.6) |
(7.6) |
(4.5) |
- |
- |
inter-company interest charges |
(13.1) |
(26.1) |
(11.3) |
47.9 |
0.5 |
2.1 |
- |
- |
Profit /(loss) after taxation
after inter-company charges after discontinued operations |
435.1 |
(114.3) |
78.4 |
2.1 |
28.3 |
(119.7) |
- |
309.9 |
Segmental assets (total assets
excluding goodwill) |
1,251.0 |
3,222.6 |
332.6 |
18.5 |
- |
95.2 |
- |
4,919.9 |
Segmental liabilities |
426.7 |
890.1 |
77.8 |
202.0 |
- |
6.2 |
- |
1,602.8 |
Goodwill |
303.5 |
- |
- |
- |
- |
- |
- |
303.5 |
Net assets (excluding
goodwill) |
824.3 |
2,332.5 |
254.8 |
(183.5) |
- |
89.0 |
- |
3,317.1 |
Capital expenditure |
193.5 |
397.7 |
1.4 |
- |
15.1 |
5.4 |
- |
613.1 |
Adjusted EBITDA |
676.2 |
(57.6) |
(95.6) |
1.6 |
59.3 |
(6.2) |
(53.1) |
524.6 |
|
|
|
|
|
|
|
|
|
Note 1: All gold sales were made in the Republic of South Africa and the majority of revenue was
generated from selling gold to South African institutions through
the group's Funding Compan
Note 2: Other expenses exclude inter-management fees and
dividend received. y.
Note 3: Uitkomst Colliery disposal was effective on 30 June 2017. The disposal of Pan African
Resources Coal Holdings Proprietary Limited and Uitkomst Colliery
was completed on 30 June 2017 and
this business was classified as a discontinued operation.
Note 4: Phoenix Platinum was classified as held for sale and as
a discontinued operation at 30 June
2017.
Summarised unaudited consolidated ZAR
segment report for the year ended 30 June
2017
|
30 June
2016 |
Continuing operations |
Discontinued operations |
|
|
Barberton
Mines |
Evander
Mines |
Corporate |
Funding
Company |
Phoenix
Platinum |
Uitkomst
Colliery |
Reclass
journal |
Group |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
ZAR
million |
Revenue |
|
|
|
|
|
|
|
|
Gold sales (Note 1) |
1,921.8 |
1,538.3 |
- |
- |
- |
- |
- |
3,460.1 |
Platinum sales |
- |
- |
- |
- |
74.7 |
- |
(74.7) |
- |
Coal sales |
- |
- |
- |
- |
- |
98.0 |
(98.0) |
- |
Realisation costs |
(8.6) |
(11.9) |
- |
- |
- |
- |
- |
(20.5) |
On - mine revenue |
1,913.2 |
1,526.4 |
- |
- |
74.7 |
98.0 |
(172.7) |
3,439.6 |
Gold cost of production |
(975.2) |
(1,180.3) |
- |
- |
- |
- |
- |
(2,155.5) |
Platinum cost of production |
- |
- |
- |
- |
(74.1) |
- |
74.1 |
- |
Coal cost of production |
- |
- |
- |
- |
- |
(91.8) |
91.8 |
- |
Depreciation |
(76.4) |
(138.0) |
- |
- |
(6.7) |
(3.2) |
9.9 |
(214.4) |
Mining Profit |
861.6 |
208.1 |
- |
- |
(6.1) |
3.0 |
3.1 |
1,069.7 |
Other income/(expenses) (Note 2) |
(155.6) |
18.7 |
(125.7) |
1.7 |
(5.4) |
5.0 |
0.4 |
(260.9) |
Profit on disposal of investment |
- |
- |
- |
- |
- |
- |
- |
- |
Profit on disposal of subsidiary |
|
|
|
|
|
|
- |
- |
Impairment costs |
- |
- |
- |
- |
- |
- |
- |
- |
Royalty costs |
(52.6) |
(7.1) |
- |
- |
- |
(0.4) |
0.4 |
(59.7) |
Net income / (loss) before finance
income and finance costs |
653.4 |
219.7 |
(125.7) |
1.7 |
(11.5) |
7.6 |
3.9 |
749.1 |
Finance income |
0.3 |
0.6 |
1.7 |
6.7 |
- |
0.2 |
(0.2) |
9.3 |
Finance costs |
(0.1) |
(0.2) |
- |
(30.8) |
- |
- |
- |
(31.1) |
Profit /(loss) before taxation
and inter-company charges |
653.6 |
220.1 |
(124.0) |
(22.4) |
(11.5) |
7.8 |
3.7 |
727.3 |
Taxation |
(182.2) |
(16.3) |
15.1 |
(0.6) |
2.5 |
4.9 |
(7.4) |
(184.0) |
Profit /(loss) after taxation
before inter-company charges |
471.4 |
203.8 |
(108.9) |
(23.0) |
(9.0) |
12.7 |
(3.7) |
543.3 |
(Loss)/profit after taxation from
discontinued operations |
- |
- |
- |
- |
- |
- |
3.7 |
3.7 |
Profit /(loss) after
taxation before inter-company charges after discontinued
operations |
471.4 |
203.8 |
(108.9) |
(23.0) |
(9.0) |
12.7 |
- |
547.0 |
Inter-company
transactions |
|
|
|
|
|
|
|
|
Management fees |
(30.9) |
(24.4) |
59.0 |
- |
(2.3) |
(1.4) |
- |
- |
inter-company interest charges |
(7.1) |
(16.1) |
(2.8) |
24.2 |
1.7 |
0.1 |
- |
- |
Profit /(loss) after taxation
after inter-company charges after discontinued operations |
433.4 |
163.3 |
(52.7) |
1.2 |
(9.6) |
11.4 |
- |
547.0 |
Segmental assets (total assets
excluding goodwill) |
1,120.6 |
2,891.9 |
61.6 |
12.5 |
198.6 |
297.4 |
- |
4,582.6 |
Segmental liabilities |
534.8 |
956.8 |
98.9 |
311.0 |
17.5 |
92.9 |
- |
2,011.9 |
Goodwill |
303.5 |
- |
- |
- |
- |
- |
- |
303.5 |
Net assets (excluding
goodwill) |
585.8 |
1,935.1 |
(37.3) |
(298.5) |
181.1 |
204.5 |
- |
2,570.7 |
Capital expenditure |
139.7 |
154.0 |
1.0 |
- |
6.8 |
0.9 |
- |
302.4 |
Adjusted EBITDA |
729.8 |
357.7 |
(125.7) |
1.7 |
(4.8) |
10.8 |
(6.0) |
963.5 |
|
|
|
|
|
|
|
|
|
Note 1: All gold sales were made in the Republic of South Africa and the majority of revenue was
generated from selling gold to South African institutions through
the group's Funding Compan
Note 2: Other expenses exclude inter-management fees and
dividend received.
Note 3: Uitkomst Colliery disposal was effective on 30 June 2017. The disposal of Pan African
Resources Coal Holdings Proprietary Limited and Uitkomst Colliery
was completed on 30 June 2017 and
this business was classified as a discontinued operation.
Note 4: Phoenix Platinum was classified as held for sale and as
a discontinued operation at 30 June
2017.