Pan African Resources Plc · LSE:PAF
Pan African Resources — FY2023 Earnings Presentation
49 slides from Pan African Resources's earnings presentation, September 2023
Slide 1: Annual Results Presentation
XXX MINING FOR A FUTURE ANNUAL RESULTS PRESENTATION for the financial year ended 30 June 2023 OTCQX: PAFRF/PAFRY | AIM: PAF | JSE: PAN www.panafricanresources.com 1
Slide 2: Disclaimer
XXX DISCLAIMER The name 'Presenter' refers to Pan African Resources PLC and its advisors, subsidiaries or affiliated companies. This presentation has not been filed, lodged, registered or approved in any jurisdiction and recipients of this document should keep themselves informed of and comply with
Slide 3: Forward Looking Statements
XXX FORWARD LOOKING STATEMENTS Statements in this presentation that address exploration activities, mining potential and future plans and objectives of Pan African Resources are forward-looking statements and forward-looking information that involve various risks, assumptions and uncertainties and a
Slide 4: Overview of Presentation
XXX OVERVIEW OF PRESENTATION Health and safety Group overview Our operating environment FY2023 – Key features Performance by operation Group AISC Capital projects (ZAR) ESG: Our “Beyond compliance” approach Financials Exploration – Republic of the Sudan FY2024 – Focused on execution Appendix OTCQX:
Slide 5: Health and Safety
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 6: Health and Safety: Group Safety Performance
HEALTH AND SAFETY XXX HEALTH AND SAFETY GROUP SAFETY PERFORMANCE Group experienced one fatality (2022: no fatalities) at Evander Mines Fatality-free shift milestones achieved underground • 3.2 million fatality free shifts at Barberton’s Consort Mine in June 2023, and 21 • TRIFR improved to 7.96 (202
Slide 7: Group Overview
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 8: Group Overview
GROUP OVERVIEW XXX GROUP OVERVIEW A UNIQUE COMBINATION OF AFRICAN UNDERGROUND AND SURFACE MINING OPERATIONS PAR Group gold production profile 250 000 ~220,000oz 205,688oz 201,777oz c.178,000 - 190,000oz 200 000 179,457oz 175,209oz 150 000 100 000 50 000 0 2020 2021 2022 2023 2024 2025 Barberton BTRP
Slide 9: FY2023 Gold Production of 175,209oz
GROUP OVERVIEW XXX GROUP OVERVIEW FY2023 GOLD PRODUCTION OF 175,209oz Moving towards a more balanced mix of low cost surface mining and high-grade, long-life u/g mines 2023 2025 EVANDER ELIKHULU EVANDER ELIKHULU Underground Underground Sur Und Surface U n d e r g ro u BTRP face e r g ro u nd nd BARB
Slide 10: Group Overview
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 11: Our Operating Environment
OUR OPERATING ENVIRONMENT XXX OUR OPERATING ENVIRONMENT 140 YEAR TRACK RECORD OF OPERATING SUCCESSFULLY IN SOUTH AFRICA ELECTRICITY MANAGEMENT AND SECURITY AND PUBLIC/PRIVATE STAKEHOLDER ENGAGEMENT SA REGULATORY FRAMEWORK COLLABORATION • National grid power to Group mining • Multi-facetted engagemen
Slide 12: Renewable Energy Roadmap
OUR OPERATING ENVIRONMENT XXX OUR OPERATING ENVIRONMENT OPERATING SUCCESSFULLY IN SOUTH AFRICA – RENEWABLE ENERGY ROADMAP The Group energy mix achieved renewable energy consumption of 6.01% vs a target of 5% of total energy consumption for 2023 Commission Feasibility Commenced study for 10MW 16% stu
Slide 13: Group Overview
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 14: FY2023 Key Features
FY2023 KEY FEATURES XXX FY2023 KEY FEATURES OPERATIONAL AND FINANCIAL PERFORMANCE PRODUCTION PERFORMANCE COST PERFORMANCE FINANCIAL PERFORMANCE Group gold production of 175,209oz Group AISC 3.3% to US$1,327/oz Resilient performance in current 14.8% (FY22 US$1,284/oz) – a sub-US$ financial year •
Slide 15: Group Overview
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 16: Performance by Operation: Tailings Operations – Elikhulu
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION TAILINGS OPERATIONS – ELIKHULU • Production steady at 50,573oz (FY22:52,220oz) despite power curtailments and Elikhulu LOM production profile* inclement weather • AISC of US$1,008/oz (FY22: US$1,003/oz) – one of the lowest cost gold 80 000 Actual
Slide 17: Performance by Operation: BTRP and Royal Sheba
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION TAILINGS OPERATIONS – BTRP AND ROYAL SHEBA • Production remained steady at 19,875oz (FY22: 19,560oz) • Lowest cost of production in the Group • AISC of US$717/oz (FY22: US$891/oz), AISC margin of 60% • Adjusted EBITDA generated: US$17.4m (FY22: U
Slide 18: Performance by Operation: Mintails
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION TAILINGS RETREATMENT OPERATIONS - MINTAILS October 2022 - Closure of transaction to acquire total share claims and capital of Mogale 800ktpm processing plant design based on successful Elikhulu and BTRP operations Gold and Mintails SA Soweto Clus
Slide 19: Mintails Construction Timeline to Commissioning
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION MINTAILS CONSTRUCTION IN PROGRESS – TIMELINE TO COMMISSIONING PROPOSED PROJECT EXECUTION TIMELINE ACTIVITY ESTIMATED DATE Completion and finalisation of DFS Completed ✓ Engineering optimisation activities Completed ✓ Detailed engineering optimisa
Slide 20: Mintails Socio-Economic Development
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION MINTAILS SOCIO-ECONOMIC DEVELOPMENT HISTORY >100 years of underground mining in the West Rand region of the Witwatersrand Goldfield • Production of over 2,000 tons of gold and 240 Mt of low-grade gold-bearing tailings material in numerous TSFs •
Slide 21: Mintails Environmental Benefits
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION MINTAILS - ENVIRONMENTAL BENEFITS: DIMINISHING SULPHATE PLUME OVER TIME OTCQX: PAFRF/PAFRY | AIM: PAF | JSE: PAN www.panafricanresources.com 21
Slide 22: Building a World Class Surface Tailings Retreatment Business
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION BUILDING A WORLD CLASS SURFACE TAILINGS RETREATMENT BUSINESS Elikhulu and Mintails production profile 140 000 Forecast 120 000 100 000 Gold production (oz) Actual 80 000 60 000 40 000 20 000 0 2040 2044 2041 2042 2043 2022 2023 2025 2026 2028 202
Slide 23: Evander Underground
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION EVANDER UNDERGROUND EVANDER 8 SHAFT PILLAR • Very successful operation – to be depleted over the next 2 years • Production of 33,256oz in FY23 (FY22:48,850oz) • FY23 159Kt u/g tons milled at 6.1g/t (FY22: 129Kt at 8.6g/t) • AISC of US$1,158/oz –
Slide 24: Fairview Mine
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION FAIRVIEW MINE Initiatives implemented to improve gold production • Continuous operations cycle • Average monthly u/g production from MRC and Rossiter orebodies 7.7% in the March 2023-July 2023 period (8,875tpm) vs July 2022- February 2023 (8,23
Slide 25: Fairview Underground Expansion and Exploration Drilling
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION FAIRVIEW MINE - UNDERGROUND EXPANSION AND EXPLORATION DRILLING ON MRC OREBODY Drilling programme on 260 Platform at MRC • Aimed at delineating the down- dip extent of current cross fracture 258 Stope • A drilling platform for 20 boreholes being e
Slide 26: Barberton Mines' Smaller Underground Operations
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION BARBERTON MINES’ SMALLER UNDERGROUND OPERATIONS SHEBA MINE Consort tons mined and Kg produced • Continuous operations, the optimisation of mining methods at the MRC and ZK 4 000 25 stopes, plus increased availability of trackless mining machinery
Slide 27: Underground Expansion and Exploration Drilling – Sheba and Consort
PERFORMANCE BY OPERATION XXX PERFORMANCE BY OPERATION UNDERGROUND EXPANSION AND EXPLORATION DRILLING – SHEBA AND CONSORT MINES 6-750 Mineral Resource block being defined Existing Mineral Resource blocks New mineralised 6-750 Existing structure intersected stope 259 Stope Sheba Mine - Western Cross d
Slide 28: Operational Overview
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 29: Group AISC
GROUP AISC XXX GROUP AISC FY2023 – GUIDING AISC OF US$1,350/oz IN FY2024* Lower cost operations Barberton Total lower Evander Mines’ cost % Group BTRP Elikhulu underground Fairview operations production AISC per kg 409,427 575,903 661,655 890,325 658,385 (ZAR/kg) 81% AISC per oz (US$/oz) 717 1,008 1
Slide 30: Group AISC Peer Comparison
US$/oz GROUP AISC 2 000 1 500 2 500 3 000 0 500 1 000 B2Gold Corp Endeavour Mining GROUP AISC OTCQX: PAFRF/PAFRY | AIM: PAF | JSE: PAN Perseus Mining FY 2023 – AISC OUTLOOK West African Source: Individual company websites and presentations Resources Gold Fields - Group Newmont Alamos Gold PAR - lowe
Slide 31: Group Overview
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 32: Capital Projects (ZAR)
CAPITAL PROJECTS (ZAR) XXX CAPITAL PROJECTS (ZAR) INVESTMENT IN ORGANIC GROWTH AND MTR – INCREASING OUR PRODUCTION PROFILE 3 500 3 000 2 500 2 000 ZARm 1 500 1 000 500 0 2021 2022 2023 2024 FC MTR Project 156 1 400 (US$ 76m) Elikhulu - Mostly expansion 64 168 305 270 (US$ 15m) Evander 195 430 1 088
Slide 33: ESG: Our Beyond Compliance Approach
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 34: ESG: Our Beyond Compliance Approach
ESG XXX ESG: OUR “BEYOND COMPLIANCE” APPROACH OUR COMMITMENT TO SUSTAINABLE DEVELOPMENT - WE HAVE IDENTIFIED 14 UN SDGS TOWARDS WHICH WE CAN HAVE THE MOST MEANINGFUL IMPACT Equity, debt and surplus cash from our operating activities FINANCIAL CAPITAL Infrastructure, orebodies and tailings retreatmen
Slide 35: ESG: Environment, Social and Governance
ESG XXX ESG: OUR “BEYOND COMPLIANCE” APPROACH GOVERNANCE ENVIRONMENT SOCIAL SOCIAL AND COMPLIANCE WATER RECYCLING STAKEHOLDER ENGAGEMENT SUSTAINABLE COMMUNITIES FULLY COMPLIANT WITH GRI REPORTING Responsible and sustainable water use • Engagement forums with communities and Barberton Blueberries pro
Slide 36: FY 2023 Financials
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 37: Summarised Consolidated Financial Results
FY 2023 FINANCIALS XXX FY2023 FINANCIALS SUMMARISED CONSOLIDATED FINANCIAL RESULTS Year ended Year ended Movement Salient features Units 30 June 2023 30 June 2022 % Gold produced oz 175,209 205,688 (14.8) Gold sold oz 174,760 205,688 (15.0) Revenue US$ million 321.6 376.4 (14.8) US$/oz 1,836 1,824 0
Slide 38: Debt Composition
FY 2023 FINANCIALS – STEADY MARGINS XXX FY2023 FINANCIALS DEBT COMPOSITION Mintails Debt Facility R1.3 billion* (US$69.0 million) RCF Facility R1.0 billion* (US$53.1million) DMTN Bond Issue R800 million* (US$42.5 million) GBF Facility R140 million* (US$7.4 million) Core debt Project specific debt *c
Slide 39: Contractual Debt Redemption Profile
FY 2023 FINANCIALS – STEADY MARGINS XXX FY2023 FINANCIALS CONTRACTUAL DEBT REDEMPTION PROFILE (ZAR) ZAR 3 500 000 000 (US$164.6 million*) (ZAR3.1 billion) 3 000 000 000 2 500 000 000 2 000 000 000 1 500 000 000 1 000 000 000 500 000 000 0 May-23 May-24 May-25 May-26 May-27 May-28 Mar-23 Mar-24 Mar-2
Slide 40: Dividends and Returns
FY 2023 FINANCIALS – DIVIDENDS AND RETURNS XXX FY2023 FINANCIALS HISTORIC DIVIDEND YIELD – TRACK RECORD OF ATTRACTIVE CASH RETURN TO SHAREHOLDERS 7% 6.3% 5.9% 6% 5.6% 5.3% 5.1% 5.0% 5% 4.6% 4% 3.8% 3% 2% 1.2% 1% 0.0% 0% June 14 June 15 June 16 June 17 June 18* June 19 June 20 June 21 June 22 June 23
Slide 41: Return on Shareholders Funds
FY 2023 FINANCIALS -20% 20% 30% -30% 0% 40% -10% 10% West African Resources Galiano Gold OTCQX: PAFRF/PAFRY | AIM: PAF | JSE: PAN Perseus Mining Sibanye Gold Ops FY2023 FINANCIALS DRD Gold RETURN ON SHAREHOLDERS FUNDS PAR Group Harmony Gold Centamin Gold Fields - South Deep B2Gold AngloGold Ashanti
Slide 42: Exploration – Republic of the Sudan
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 43: Exploration – Republic of the Sudan
EXPLORATION – REPUBLIC OF THE SUDAN XXX EXPLORATION – REPUBLIC OF THE SUDAN WHY SUDAN? PROGRESS IN FY2023 Third largest gold producer in Africa (after Ghana and SA) and 10th in In Q3, the Group commissioned the first commercial fire assay multi- the world (2021) element analytical laboratory in Suda
Slide 44: Focused on Execution
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 45: FY2024: Focused on Execution
FY2024 – FOCUSED ON EXECUTION XXX FY2024: FOCUSED ON EXECUTION KEY DELIVERABLES Continue with focus on health and safety initiatives in our proactive journey Risk and opportunity management process to ‘zero harm’ Monitor optimisation and restructuring initiatives intended to increase production and
Slide 46: Thank you
XXX Thank you Contact: Hethen Hira, Head of investor relations Email: Hhira@paf.co.za www.panafricanresources.com OTCQX: PAFRF/PAFRY | AIM: PAF | JSE: PAN www.panafricanresources.com 46
Slide 47: Appendix
1.0 Health and safety 2.0 Group overview 2.1 Our operating environment 2.2 FY2023 – Key features 2.3 Performance by operation 2.4 Group AISC 2.5 Capital projects (ZAR) 3.0 ESG: Our “Beyond compliance” approach 4.0 FY2023 Financials 5.0 Exploration – Republic of the Sudan 6.0 FY2024 – Focused on exec
Slide 48: Company Snapshot
APPENDIX XXX COMPANY SNAPSHOT As at 7 September, 2023 Corporate Information Board and Executives JSE (PAN) ZAR321cps KEITH SPENCER CORPORATE OFFICE COMPANY SECRETARY • Chairman AIM (PAF) GBP13.9p The Firs Building Jane Kirton • Appointed: 2nd Floor, Office 204 St James’s Corporate Services 8 October
Slide 49: Reserves and Resources
APPENDIX XXX RESERVES AND RESOURCES GROWTH PORTFOLIO – ROBUST PROJECT PIPELINE Tonnes Grade Gold Gold Gold Mineral Resources* Mt g/t t Moz Barberton hard rock 24.5 4.2 102.1 3.3 BTRP 22.3 1.2 26.0 0.8 Evander underground 111.1 9.1 1 009.0 32.4 Elikhulu 163.4 0.3 44.2 1.4 Elikhulu 259.8 0.3 78.5 2.5