Slide 1: Results Presentation for the year ended 30 June 2017
RESULTS PRESENTATION for the year ended 30 June 2017
Slide 2: Disclaimer
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 and
Slide 3: Forward Looking Statements
FORWARD LOOKING STATEMENTS Statements in this report 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 are not sta
Slide 4: The African-Focused Precious Metals Producer
THE AFRICAN-FOCUSED PRECIOUS METALS PRODUCER
Slide 5: Presentation Summary
PRESENTATION SUMMARY • Group overview and review of FY17 • Group safety performance • Our long-life, low-cost tailings retreatment operations • Our long-life underground mines › Barberton Mines › Evander Mines • Financial results • Growth – where to next? • Key 2018 deliverables 5
Slide 6: Group Overview and Review of FY17
GROUP OVERVIEW AND REVIEW OF FY17
Slide 7: Who we are
GROUP OVERVIEW AND REVIEW OF FY17 Who we are AFRICAN MID-TIER PRECIOUS METALS PRODUCER • Dual-listed on South Africa’s JSE and London’s AIM • Market capitalisation of ZAR5.3 billion (USD410 million) on 30 June 2017 • Quality assets with a production capacity in excess of 250,000oz of gold per annum
Slide 8: Summary of FY17 results
GROUP OVERVIEW AND REVIEW OF FY17 Summary of FY17 results Gold production impacted by a number of operational challenges • 55-day underground suspension at Evander, lack of underground mining flexibility and community unrest at Barberton • FY17 gold sold of 173,285oz (2016: 204,928oz) Unit cost of p
Slide 9: Group Safety
DAS ZI APP Z = a GROUP SAFETY
Slide 10: Group Safety Performance
GROUP SAFETY PERFORMANCE Accident rates compared to the South African gold mining industry BML LTIFR rate at 2.04 Per million man hours 6 5 4 3 2 1 0 2013 2014 2015 2016 2017 2.74 2.97 2.29 3.50 3.51 - 5.13 4.27 4.67 5.22 4.44 PAR Lost-time injury frequency rate (LTIFR) Gold Industry Lost-time injur
Slide 11: Group Safety Performance: Key initiatives
GROUP SAFETY PERFORMANCE Key initiatives • Appointed Safety Managers to the Management Committees of each operation • Behaviour-based safety interventions at each operation › Barberton Mines – approximately 1,700 employees addressed thus far › Evander Mines – weekly visible felt leadership intervent
Slide 12: Safety intervention before shift goes underground
GROUP SAFETY PERFORMANCE Safety intervention before shift goes underground 12
Slide 13: Our Long-Life, Low-Cost Tailings Retreatment Operations
OUR LONG-LIFE, LOW-COST TAILINGS RETREATMENT OPERATIONS
Slide 14: Gold tailings retreatment operations
OUR LONG-LIFE, LOW-COST TAILINGS RETREATMENT OPERATIONS Gold tailings retreatment operations • Barberton Tailings Retreatment Plant ➢ ~20,000oz p/a gold production, LOM of 14 years ➢ AISC of USD392/oz ➢ Initial capital outlay of ZAR325.7 million (~USD37 million) – paid back in 18 months • Evander Ta
Slide 15: Gold surface sources production – financial years
OUR LONG-LIFE, LOW-COST TAILINGS RETREATMENT OPERATIONS Gold surface sources production – financial years Oz AISC (USD) 60 000 56,218oz 600 46,742oz 500 40 000 400 30,806oz 300 22,885oz 20 000 200 100 0 0 2014 2015 2016 2017 ETRP 6 523 18 151 29 473 BTRP 22 885 24 283 28 591 26 745 AISC 511 550 433
Slide 16: Elikhulu Project
OUR LONG-LIFE, LOW-COST TAILINGS RETREATMENT OPERATIONS Elikhulu Project 16
Slide 17: Elikhulu project timeline - on schedule and on budget
OUR LONG-LIFE, LOW-COST TAILINGS RETREATMENT OPERATIONS Elikhulu project timeline - on schedule and on budget Date Status • Detail engineering starts Quarter 4 2016 ✓ • Procurement starts Quarter 2 2017 ✓ • Environmental and Social Impact Assessment approval Quarter 3 2017 ✓ • Issue of Integrated Wa
Slide 18: Elikhulu production profile – calendar years
OUR LONG-LIFE, LOW-COST TAILINGS RETREATMENT OPERATIONS Elikhulu production profile – calendar years 70 Excludes soil 0.35 resources of 60 ~244,398oz 0.30 50 0.25 Gold Recovered (Koz) Grade (g/t) 40 0.20 30 0.15 20 0.10 10 0.05 0 0.00 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Slide 19: Gold surface sources production – looking forward
OUR LONG-LIFE, LOW-COST TAILINGS RETREATMENT OPERATIONS Gold surface sources production – looking forward Oz AISC (USD) 100 000 600 91,000oz 500 80 000 400 60 000 56,218oz 46,742oz 300 40 000 30,806oz 200 22,885oz 20 000 100 0 0 2014 2015 2016 2017 Indicative new Elikhulu 56 000 ETRP 6 523 18 151 29
Slide 20: Possible all-in sustaining cost comparison including Elikhulu
OUR LONG-LIFE, LOW-COST TAILINGS RETREATMENT OPERATIONS Possible all-in sustaining cost comparison – USD/oz including Elikhulu 1400 1200 1000 800 600 400 200 0 Source: As per the latest Annual or Interim results published by each company – whichever is the latest published figure Assumptions used on
Slide 21: Long-Life Underground Mines
LONG-LIFE UNDERGROUND MINES
Slide 22: Barberton Mines
BARBERTON MINES High-quality and long-life
Slide 23: Barberton Mines: Production statistics
BARBERTON MINES Production statistics Head grade (g/t) Tonnes excluding BTRP 350 000 12 96,296oz 88,738oz 300 000 10 81,493oz 84,690oz 71,763oz 250 000 8 200 000 6 150 000 4 100 000 50 000 2 0 0 2013 2014 2015 2016 2017 Fairview tonnes 119 089 114 598 111 875 114 815 103 862 Sheba tonnes 109 103 99
Slide 24: Fairview Mine sub-vertical shaft – project detail and outcomes
BARBERTON MINES Fairview Mine sub-vertical shaft – project detail and outcomes Detail: • Excavate a 4.1m diameter, 638m sub-vertical shaft from 42 to 64 level by means of a raise borer • Equip sub-vertical shaft to hoist men and material, thus, freeing up additional hoisting time and reducing time t
Slide 25: Longitudinal projection through Fairview
BARBERTON MINES Longitudinal projection through Fairview Current mining areas Current at Fairview mining areas Mine at Sheba Mine Sub-vertical shaft 25
Slide 26: Evander Mines
EVANDER MINES World-class orebody
Slide 27: Evander Mines: Production statistics
EVANDER MINES Production statistics Tonnes milled (‘000) Underground head grade (g/t) 500 000 8 88,002oz 65,956oz 73,496oz 7 53,746oz 400 000 6 300 000 5 45,304oz 4 200 000 3 2 100 000 1 0 0 2013 2014 2015 2016 2017 Underground 390 372 395 127 381 986 408 281 260 784 Underground head grade 7.4 5.2 4
Slide 28: Evander production sustainability
EVANDER MINES Production sustainability Production sustainability Engineering work successfully performed during 55-day operational suspension Engineering work post 55-day stoppage • Replaced redundant shaft steelwork in 7A Shaft (guides and buntons) ✔ • 7A Shaft • Removed redundant pipes in 7A Shaf
Slide 29: Production stability – Mining optimisation results
EVANDER MINES Production stability – Mining optimisation results M²/Crew Efficiency 8 Shaft m² 8 000 400 Current clean mining 364 367 Current clean mining 6,914 initiative introduced 349 7 000 initiative introduced 6,600 350 313 321 6,263 6,0916,273 280 6 000 5,596 300 5,001 250 5 000 4,488 250 224
Slide 30: Accelerated Development Plan
EVANDER MINES Accelerated Development Plan • Critical development fast tracked by deployment of mechanised drill rig and multi-blast operations to ensure sustainable production and grade profile • Planned development of 350m per month on average 30
Slide 31: Planned drill rig development 24A N 01C X/C and 24 A Drive East
EVANDER MINES Planned drill rig development 24A N 01C X/C and 24 A Drive East 24 A N 01 X/C 24 A N 01A X/C 24 A N 01B X/C 24 A N 01C X/C 24 A N 01D RSE 24 A N 01E Stope 31
Slide 32: Financial Results
FINANCIAL RESULTS Deon Louw, Financial Director
Slide 33: ZAR Gold Price Hedge for Weaker Currency
ZAR GOLD PRICE HEDGE FOR WEAKER CURRENCY USD vs ZAR gold price – 2 years ended 30 June 2017 Relative performance rebased to 100 (USD and ZAR gold) USD/ZAR Gold price Exchange rate 160 18.00 16.00 140 14.00 120 12.00 10.00 100 8.00 80 6.00 4.00 60 2.00 40 - Jul 15 Jun 16 Jun 17 USD Gold price ZAR Gol
Slide 34: Summarised consolidated results
PAN AFRICAN RESOURCES PLC Summarised consolidated results For the year ended 30 June 2017 For the year ended 30 June 2016 ZAR GBP ZAR GBP Revenue (million) 2,925.3 169.6 3,460.1 161.3 Cost of production (million) (2,343.1) (135.8) (2,176.0) (101.4) Mining profit (million) 401.2 23.3 1,069.8 49.9 Adj
Slide 35: Financial Summary – Group Results (ZAR/kg)
FINANCIAL SUMMARY – GROUP RESULTS Costs as defined by World Gold Council ZAR/kg 600 000 Margin pressure 450 000 300 000 150 000 0 2013 2014 2015 2016 2017 Average gold price received 440 824 433 437 446 274 542 850 542 773 Cash cost 231 439 298 345 349 410 338 242 430 863 All-in sustaining costs 281
Slide 36: Financial Summary – Group Results (USD/oz)
FINANCIAL SUMMARY – GROUP RESULTS Costs as defined by World Gold Council USD/oz 1 800 1 500 Margin pressure 1 200 900 600 300 0 2013 2014 2015 2016 2017 Average gold price received 1 553 1 303 1 212 1 164 1 242 Cash cost 815 897 949 725 986 All-in sustaining costs 992 1 049 1 093 870 1 177 All-in co
Slide 37: Financial Summary – Allocation of cash flows
FINANCIAL SUMMARY – GROUP RESULTS Allocation of cash flows ZAR GBP CASH FLOWS FROM OPERATING ACTIVITIES Net income before taxes from continuing operations 396,043,585 23,006,495 Net movement in non-cash flow items and discontinued operations 62,711,628 3,597,356 Operating profit before working capit
Slide 38: Disciplined capital allocation decisions
FINANCIAL SUMMARY – GROUP RESULTS Disciplined capital allocation decisions Investment capital/ Project purchase price (ZARm) Forecast payback period Phoenix CTRP 308.9* Forecasting 10 years payback on current PGM basket prices BTRP 325.7 Paid back in 18 months ETRP 174.3 Paid back in less than 3 yea
Slide 39: Proposed dividend yield versus peers
FINANCIAL SUMMARY – GROUP RESULTS PAR proposed dividend yield versus estimated dividend yield of our peers 1.2x 6% PAR 2017 proposed dividend yield 1.0x 5% 0.8x 4% Dividend yield Payout ratio 0.6x 2.8% 3% 0.50x 0.4x 2.0% 2% 0.2x 1% 0.7% 0.8% 0.8% 0.9% 0.8% 1.0% 1.8% 2.2% 3.2% 2.2% 2.6% 3.2% 3.6% 3.9
Slide 40: Value creation and distribution
FINANCIAL SUMMARY – GROUP RESULTS Value creation and distribution 1.4% 0.7% 4.0% 6.6% 14.6% 45.9% Total value created – ZAR3,440.3 million 26.8% Suppliers Employees Reinvested Shareholders Taxation Finance costs CSI 40
Slide 41: Growth – Where to Next?
GROWTH – WHERE TO NEXT?
Slide 42: Investing in the Future: Gold capital spend
INVESTING IN THE FUTURE Gold capital spend ZAR’ million 700.0 Barberton Mines Expansion Capex 2017: • Refrigeration Plant – ZAR41.5 mil • Royal Sheba – ZAR12.7 mil 600.0 • BTRP Cyanide detox plant – ZAR17.8 mil 500.0 Evander Mines Expansion Capex 2017: • 2010 Pay Channel – ZAR8.0 mil • 25 and 26 Lev
Slide 43: Growth portfolio
GROWTH – WHERE TO NEXT? Growth portfolio Strong track record of delivery Barberton Evander BTRP Production ETRP Elikhulu, Fairview sub-vertical project, Evander No 7 Shaft Pillars Construction Royal Sheba, 2010 Pay Channel, Elikhulu LOM extension, Surface sources Feasibility ZK/MRC orebody extension
Slide 44: Barberton Mines exploration – near mine targets
GROWTH – WHERE TO NEXT? Barberton Mines exploration – near mine targets • Fairview mine • Infill drilling to maintain LOM of 20 years • Down-dip extension of MRC orebody to 72 level and beyond • Targeting inferred resources (0.3Moz) of the MRC (BH 5951 at 125.80g/t over 680cm ) • Drilling targeting
Slide 45: Other growth projects – Evander
GROWTH – WHERE TO NEXT? Other growth projects – Evander 45
Slide 46: Evander Shaft revival
GROWTH – WHERE TO NEXT? Evander 7 Shaft revival • 7 Shaft vamping and pillar mining • No. 3 decline dewatering project and subsequent vamping and pillar mining • 2010 Pay Channel ➢ Pay Channel is adjacent to 7 Shaft infrastructure and will not require new vertical shaft or plant infrastructure ➢ Acc
Slide 47: Evander - Rolspruit
GROWTH – WHERE TO NEXT? Evander - Rolspruit Evaluating options to access Rolspruit orebody by utilising current infrastructure Contained gold As a t 30 June 2017 Category Tonnes million Grade g/t Tonnes Moz Mineral reserves Proved Probable 23.4 8.60 201.2 6.46 Rolspruit Total 23.4 8.60 201.2 6.46 47
Slide 48: Focus for 2018
FOCUS FOR 2018
Slide 49: 2018 Key Deliverables
2018 KEY DELIVERABLES • Continuing to improve our safety performance, regulatory compliance and stakeholder engagement across all operations • Achieving gold production guidance of 190,000oz plus, with resultant reduction in AISC to sub USD1,000/oz • Delivering Elikhulu on time and on budget • Growt
Slide 50: Thank You
THANK YOU
Slide 51: Appendix
APPENDIX
Slide 52: Geographical Map
RI RESOURCE LIMPOPO Kruger Rational BOTSWANA l MPUMALANGA park Nelspruit — 5: = Ne Rustenburg GAUTENG athe @® eae on Zeerust 5 -— -© Middelburg phoenix @® ——— Barberton Platinum W\tbank Evander Mines NORTH WEST PROVINCE SWAZILAND a Vryburg, Kur uinan NORTHERN CAPE FREE STATE 52
Slide 53: Elikhulu Plant Design
ELIKHULU PLANT DESIGN Elution Circuit Offices and Gold Room Change-house CIL Plant Workshop Transformers and MCC 53
Slide 54: Elikhulu – Current Status
ELIKHULU – CURRENT STATUS Crane base Pre-oxidisation tank base 1st CIL tank base 54
Slide 55: Growth: Evander 2010 Pay Channel
GROWTH Evander 2010 Pay Channel 55
Slide 56: PAN share price relative to market
FINANCIAL PAN share price relative to market – 5 years ended 30 June 2017 Relative performance rebased to 100 250 200 150 100 50 0 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 17 Pan African Resources FTSE / JSE Gold price index Source: Bloomberg & IRESS 56