Valterra Platinum Limited · JSE:VAL
Valterra Platinum — Anglo American Platinum — H1 2021 Earnings Presentation
59 slides from Valterra Platinum's earnings presentation, Jul 26, 2021
Slide 1: Anglo American Platinum 2021 Interim Results
AngloAmerican PLATINUM Anglo Ar 2021 Ir 26 July 2021 _
Slide 2: Cautionary Statement
Cautionary Statement Disclaimer: This presentation has been prepared by Anglo American Platinum Limited ("Anglo American Platinum’) and comprises the written materials/slides for a presentation concerning Anglo American Platinum, By attending this presentation and/or reviewing the slides you agree t
Slide 3: H1 2021
H1 202
Slide 4: AngloAmerican
we AngloAmerican ) —
Slide 5: H1 2021 overview
H1 2021 overview Strong safety, operational and financial performance Commitment to zero harm Zero work-related fatalities at all operations. Economic contribution to society R39.2 billion economic contribution to stakeholders and society, WeCare and Covid-19 support. Strong recovery in production M
Slide 6: Delivering against strategic priorities
H1 2021 overview Delivering against strategic priorities pp. 7 @ © Stimulate new markets and Embed anti-fragility across Maximize value from A leader in leverage new capabilities our business our core ESG Our values 7 Safety aye Integrity rah Collaboration net Care and respect fey Accountability @ I
Slide 7: ESG performance
ESG performance Mogalakwena Mapela Water project
Slide 8: Zero fatalities and Covid-19 management
ESG performance Zero fatalities — continuous efforts to achieve zero harm Safety Covid-19 management ge Annual Loss of life —*—TFCFR" ° 2017 2018 2019 2020 H12021 Focus on behaviours..particularly during period of disruption and change Technology and modernisation will drive sustainable long term im
Slide 9: WeCare - supporting employees and communities through Covid-19
ESG performance WeCare - supporting employees and communities through Covid-19 Safety at the workplace Supporting communities Maintaining strict protocols Providing PPE and sanitizer, and medical supplies to hospitals in Zimbabwe and SA Supporting mental health & wellbeing Providing food parcels for
Slide 10: Economic contribution of R39.2 billion
ESG performance Economic contribution of R39.2 billion Taxes and royalties Local & doorstep procurement Increasing contribution to stakeholders and society R16.6b6n Salaries and wages R2.2bn Social investment & Covid-19 support RS.Sbn RO.Sbn R39.2bn R25.7bn R14.86n, R12.1bn H12018 H12019 H12020 H120
Slide 11: Plans to reach zero scope 1 & 2 emissions targets
ESG performance Plans being embedded to reach zero scope 1 & 2 emissions targets - Mogalakwena example Total Company emissions Roadmap to emissions reduction at Mogalakwena (Scope 1 &2 2020)8 Other Coal % 1% me Diesel Re” 3.94 million tons CO, equivalent Electricity 88% (tonnes COje)* ~1 million ton
Slide 12: Progress on zero-emissions mine solution at Mogalakwena
ESG performance Progress on zero-emissions mine solution at Mogalakwena System Architecture We generate renewable electricity which is: @ Excess energy converted to hydrogen (H,) Completed design and build of infrastructure for electrolysers, storage & refuelling. Performed high speed hydrogen refue
Slide 13: Production performance
Production performance ) Converter Plant) at Waterval Smelter, Rustenburg - Furnace tap
Slide 14: Benefit of a diversified portfolio contributing to EBITDA
Production performance Benefit of a diversified portfolio contributing to EBITDA and strong margins Own-mine PGM production EBITDA contribution per own-mine operation (000 ounces) (Rand billion) 71% 1,454 422 219 R10.6bn R12 Son H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021 4(Amandelbult end of li
Slide 15: Production performance
Production performance Picture 15
Slide 16: Strong refined production driven by ACP performance
Production performance Strong refined production driven by ACP performance Average daily ACP feed Refined PGM production by quarter (tonnes) (000 ounces) 670 2,327 2,175 2,141 1.354 466 341 1,019 H1 2018 H1 2019 H1 2020 H1 2021 2018 2019 2020 2021 mQ1 9Q2 16
Slide 17: Future of Mogalakwena
Production performance Future of Mogalakwena - progressing workstreams whilst feasibility studies finalising Operational efficiencies Resource development plan Technology & innovation Communities ~ spss es a 7 Focused on improving loading Life of asset planning Bulk ore sorter optimisation and Socia
Slide 18: Amandelbult
Production performance Amandelbult — | 18
Slide 19: Maximising value from our core through own-mine production
Production performance Maximising value from our core through increasing own-mine production PGM and base metal production per annum 2020 - 2030 (million ounces and kilotonnes) Operational efficiencies include ~3.6m PGMs Unki concentrator debottleneckin ~3.0m i 9 PGMs° Modernisation of Amandelbult |
Slide 20: Financial review
Financial review
Slide 21: Record H1 financial performance
Financial review Record H1 financial performance Revenue EBITDA Headline earnings 4 R107.5on R63.3bn R464bn ROCE Net cash Dividend declared “SS 207% 4 R57.6bn R1/5/share 100% of headline earnings
Slide 22: Record EBITDA: strong PGM prices and higher volumes
Financial review Record EBITDA: strong PGM prices and higher volumes EBITDA PGM Rand basket price increase (Rand billion) ~ AW 29% oe PGM sales volume increase (26) = AS 109% Company EBITDA margin H1 2020 Price Fx and CPI Royalties Net cost & H1 2021 volume impact %X m@Rh Pd =Pt © Other oO 22
Slide 23: Working capital reduction
Financial review Working capital reduction Trade working capital movements 3E WIP inventory release (Rand billion) ~R2bn POC inventory value increase (0.1) R5bpn Total customer prepayment Dec 2020 Inventory Netother working Customer prepayment H1 2021 R y Ob N capital movements 23
Slide 24: Unit costs impacted by higher than CPI input cost inflation
Financial review Unit costs impacted by higher than CPI input cost inflation Unit cost per PGM ounce Mining production SN 28% Mining inflation ® 8.2% Revised unit cost guidance H1 2020 Production Costinflation Covid-19 Costs H1 2021 R1 2, @) O O- R1 2, 5 O O production &costimpact per PGM ounce (Ran
Slide 25: Net cash position of R57.6 billion
Financial review Net cash position of R57/.6 billion First half cash generation Cash from operations (Randblion sas “a R61.9bn Net cash position aco nonspucer “Ss R57.6bn m= Customer prepayment & other m Capex Dividend Committed unutilised debt facilities R20.6bn H12020 H12021 25
Slide 26: Capital focused on asset reliability
Financial review } capital focused on asset eliability (Rand billion) 7.0-7.5 a -: SIB ” a ee H12020 H12021 2021 Guidance @ Capital Maintanance Rebuilds HME Other = Capitalised waste stripping Projects & Breakthrough
Slide 27: Industry-leading returns to shareholders
Financial review Industry-leading returns to shareholders H1 2021 dividend per share H1 2021 dividend declared Dividend pay-out ratio R46.4n 100% 100% > pay-out ratio Dividend per share Dividend yield R1/5/share 1% Headline Dividend earnings per share per share 27
Slide 28: Market review
PMR: Palladium good delivery bar with grain
Slide 29: Strong basket price - led by rhodium and minor PGMs
Strong basket price - led by rhodium and minor PGMs Indexed market prices log scale (1 Jan 2020=100)¢ PGM prices were exceptionally strong in oo 7 12021. Our realised dollar basket price was up 47% and rand basket was up 29%. Rhodium market price increased 167% contributing most to the gains’. Minor
Slide 30: Short term: auto demand tempered by chip shortage
Market review Short term: growth in auto demand tempered by chip shortage Semiconductor shortage slows LDV recovery® Substitution potential? Million vehicles Auto demand (million ounces) 50 Impact from Auto production and sales semiconductor growing but recovery shortage slowed by chip shortage 45 :
Slide 31: Platinum - future demand drives deficit
Market review Platinum - future demand from gasoline substitution & hydrogen economy drives deficit Market balance? 2021 demand by segment” 000 ounces (370) 2015 (238) 2016 = 2017 - 2018 2019 (669) 2020 2021 2022 2023 2024 2025 Fuel cells 1% Industrial Autocatalyst 33% 35% 8m ounce market —_ S 8% Je
Slide 32: Palladium - large deficit driven by auto demand
Market review Pal adium — and tighter emissions legislation Market balance”? large deficit driven by auto demand 2021 demand by segment" 000 ounces - a - (278) (728) (907) 2015 2016 2017 2018 2019 (728) 2020 2021 2022 2023 2024 2025 Jewellery 9, Industrial y a Mm ounce market Autocatalyst 88% 32
Slide 33: Rhodium - NOx reduction qualities drive auto demand
Market review Rhodium — unique NOx reduction qualities drive auto demand and continuing deficits Market balance”? 2021 demand by segment" 000 ounces Jewellery Industrial 1% 8% os 11M ounce market 117 49 = " - 72) Autocatalyst 1% 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 33
Slide 34: Medium term: auto PGM demand driven by tighter emissions legislation
Market review Medium term: auto PGM demand driven by tighter emissions legislation Rising PGM loadings - example Euro gasoline LDV Robust PGM demand from LDV globally Euro emissions standards! Loading 5 Sb 6b 6c 6d Million vehicles (LHS), million ounces (RHS) 7 120 (estimate) 100 —-epenl 80 60 40 20
Slide 35: ~~ Cc oO c QO O 0) > Oo O Ww O x e)
~~ Cc oO c QO O 0) > Oo O Ww O x e) >
Slide 36: Hydrogen economy - sustainable future demand accelerating
Market development Hydrogen economy - sustainable future demand accelerating Hydrogen economy commitments accelerate (July 2021) 359 $76bn 69GW Large-scale projects Governments pledge to Electrolyser announcements ES South African Hy UK AHFCTS China Freight Corridor IHFCANS Accelerate hydrogen throu
Slide 37: Market development
Market development • • • • • • 37
Slide 38: Waterval complex
Waterval complex 38
Slide 39: Guidance & H1 2021 summary
Guidance & H1 2021 summary 39 RBMR: Copper tankhouse
Slide 40: Strong safety, operational and financial performance
Guidance & H1 2021 summary Strong safety, operational and financial performance Commitment to zero harm Zero work-related fatalities at all operations. Economic contribution to society R39.2 billion economic contribution to stakeholders and society, WeCare and Covid-19 support. Strong recovery in pr
Slide 41: 41
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Slide 42: PGM prill split by asset - H1 2021
Appendix PGM prill split by asset — H1 2021 100% 1% 1% 13% 13% 90% 14% 17% 80% 70% 60% 50% 40% 30% 20% 10% 0% Mogalakwena Amandelbult Mototolo Unki Modikwa Kroondal POC =Platinum = Palladium = =Rhodium— = Iridium Ruthenium = Gold 42
Slide 43: Mototolo / Der Brochen - project to extend life of mine
Appendix Mototolo / Der Brochen - project to extend life of mine PGM production Concentrator debottlenecking project to 240 Ounces per annum ktpm completed 400.000 Develop decline and required infrastructure to 350,000 access Der Brochen ore body, to replace : declining production from Mototolo. 300
Slide 44: New floatation circuit at Unki concentrator
Option 2 - appendix Appendix 44 New floatation circuit at Unki concentrator
Slide 45: Secondary supply - rising trend mainly from palladium
Appendix Secondary supply - rising trend mainly from palladium Projected autocatalyst recycling volume” (000 ounces per annum) 7,000 6,000 5,000 4,000 3,000 2,000 1,000 4 15 6 V7 8 19 20 21 = Platinum = Palladium 22 23 24 = Rhodium 25 26 27° 28 «29 «30 Autocatalyst recycling volumes set to increase
Slide 46: Truck demand - a platinum growth area
Appendix Truck demand - a platinum growth area Heavy-duty PGM automotive demand in China and India™® 000 ounces per annum 225 2020 2021 = China 2022 alndia 2023 All Chinese trucks sold by 2023 will need platinum- based catalysts due to tightening emissions. Many manufacturers implementing systems ea
Slide 47: Outlook for global emissions regulation - light duty
Appendix Outlook for global emissions regulation — light duty” N America Tier 2 Tier3 Tier 4 Europe EURO 5S EURO 6b EURO 6c EURO 6d EURO7 China (gas) CHINA 3 CHINA 6a CHINA 6b + RDE CHINA7 Japan JAPAN 2009 India BHARAT IV BHARAT V BHARAT VI + RDE 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 203
Slide 48: Outlook for global emissions regulation - heavy duty
Appendix Outlook for global emissions regulation — heavy duty” Europe EURO VII china CHINA Vib CHINA VII Japan 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Slide 49: Balanced capital allocation framework
Appendix Balanced capital allocation framework Balance sheet flexibility Se ceeiscretiono’y Pita] optio™ Portfoli Additional Future project om oat shareholder options Ueeserlo returns including ESG R49.3bn Sustaining free cashflow2° RI.4bn Breakthrough projects, growth and life extension H12021 divi
Slide 50: Appendix
Appendix Based on 30 June 2021 closing share price 50
Slide 51: Capital expenditure guidance
Appendix Capital expenditure guidance — S years mStay-in-business = Capital waste stripping m Life extension Breakthrough projects = Growth projects Capital expenditure 2021 2022E 2023E Total capital expenditure (R billion) 127-14.0 125-133 N3-NS Stay-in-business (Rbillion) 70-75 78-83 78-83 Capital
Slide 52: EBITDA sensitivity
Appendix EBITDA sensitivity Impact of 10% change in Sensitivity analysis — H12021 30 June spot Average realised price/FX Commodity / unit Rand million Platinum ($/oz) 1072 1970 1634 Palladium ($/oz) 2,682 2641 2,903 Rhodium ($/oz) 49,500 24,377 3,938 Gold ($/oz) 1760 1792 95, Nickel ($/ton) 18,279 1
Slide 53: Net cash flow by mine
Appendix Net cash flow by mine Project Assets Netcash Cash SlBand waste Economic free — capital + Customer Proceedsand Income tax Dividends oc “ea 31Dec 2020 generated capital cash flow interested prepayment investments paid paid chang : changes 2021 capitalised Mogalakwena 20,329 (2,800) 7,529 (494
Slide 54: Cost breakdown
Appendix Cost breakdown Costs reflective of AAP own mined and joint operations share of production and costs at operations (excludes all purchase of concentrate costs and volume, overhead and marketing expenses). H12021 Cost base (Rin) Volume % PGMs (koz) Labour Contractors Materials Utilities Sundr
Slide 55: All-in sustaining cost (AISC)
Appendix Allin sustaining cost (AISC) lakwena — Amandelioult Mototolo Unk: kwar Other Mining Costs (US$ million) Cash operating costs 407 an m2 90 70 m 1202 Other costs and marketing 147 Bi 34 42 2 4 8 47 Capitalised waste costs 108 108 Sustaining capital 87 20 6 6 4 n 4 148 a Total Cost 749 563 162
Slide 56: Rand basket price
Appendix Rand basket price lakwena Mototolo Unki Mining Company Netsales revenue (US$ million) from platinum 357 233 75 63 17 846 440 1.286 from palladium 841 232 101 no 164 1.457 458 1915, from thodium 537 829 255 126 438 2184 1195 3379 from other metals 223 138 33 48 55 498 283 798 a Totalrevenue
Slide 57: Simplified EBITDA per PGM ounce
Appendix Simplified EBITDA per PGM ounce Attributable nt operations _Exitand Company (Rmillion) jalakwena_Amandelbult_ Mototolo Unki share_C&M mines Mined POC & tol Trading er Company _(ex trading) a=(bx0)/1000+d Net revenue 28,215 20,640 6,694 5,28 11184 71,831 34,889 812 407532 106720 b Basket pri
Slide 58: Three-year guidance
Appendix Three-year guidance Unit 2021E 2022E 2023E Metal in concentrate Total PGMs (mounces) 42-44 42-46 42-46 Platinum (mounces) 19-20 19-21 19-21 Palladium (mounces) 135-140 14-15 14-15 Other PGMs and gold (mounces) 095-10 09-10 09-10 Refined production Total PGMs (mounces) 48-50 47-51 42-46 Plat
Slide 59: Footnotes
Footnotes 1) Total recordable case injury frequency rate (TRCFR) is a measure of all injuries requiring treatment above first aid per 7,000,000 hours worked 2) [Gap] 3) Scope 1covers direct emissions from owned or controlled sources. Scope 2 covers indirect emissions from the generation of purchased
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