Northam Platinum Holdings Limited · JSE:NPH
Northam Platinum — FY2021 Earnings Presentation
44 slides from Northam Platinum's earnings presentation, September 2021
Slide 1: The new Northam: continuing to create value for all stakeholders
The new Northam: continuing to create value for all stakeholders Results for the year ended 30 June 2021 www.northam.co.za Page
Slide 2: Cautionary statement
Cautionary statement The presentation comprises the written materials made available together with the related verbal presentation (collectively or individually, as the context may require, the "Presentation") concerning Northam Platinum Holdings Limited ("Northam Holdings"). By attending the Presen
Slide 3: Agenda
Agenda Key features Paul Dunne Our Composite Transaction Paul Dunne Our contribution Paul Dunne Our operations and projects Paul Dunne Financial review Alet Coetzee Operational guidance Paul Dunne Northam Platinum Holdings Limited Results for the year ended 30 June 2021 www.northam.co.za Page 3
Slide 4: Key features for the year
Key features for the year Solid operational performance Production Operating profit Capex 690 867oz 4E R16.1bn R3.3bn Up by 34.1% Operating profit margin: 49.4% All projects on track (F2020: R5.3bn) All mines operating at 100% Inventory build-up to normalise post COVID-19 lockdown during the next 2
Slide 5: Our Composite Transaction
Our Composite Transaction www.northam.co.za Page
Slide 6: Our Composite Transaction
Our Composite Transaction Accelerated maturity of the Implementing the Extended Zambezi BEE Transaction Empowerment Transaction Transferring Unlocked significant ownership Mitigated maturity Creating an enabling unencumbered to employees and risk corporate structure value host and affected communiti
Slide 7: Our Composite Transaction
Our Composite Transaction R4.4bn R563.7m R933.6m to strategic empowerment to our employee trust to our community trusts groups R5.2bn 362 million R150.0m in tax paid shares in issue annual payment to employee and community trusts Northam Platinum Holdings Limited Results for the year ended 30 June 2
Slide 8: Our contribution
Our contribution www.northam.co.za Page
Slide 9: Our country, our contribution
Our country, our contribution 8 232 2 335 R5.0bn Direct, new, meaningful, Direct, new, meaningful, Employee costs for sustainable jobs created sustainable jobs created F2021 since 2015 during F2021 R3.7bn R1.5bn R1.1bn Income tax paid during Mineral royalty tax paid Tax paid by our employees F2021 d
Slide 10: Our operations and projects
Our operations and projects www.northam.co.za Page
Slide 11: Safety
Safety 0.60 2.5 Group LTIIR Zondereinde Booysendal Eland Group 23.1% improvement 2.0 1.92 on F2020 LTIIR per 200 000 hours 1.65 6 million 1.5 1.31 1.29 1.29 1.03 1.0 fatality free shifts 0.82 0.79 at Booysendal 0.54 0.53 in February 0.44 0.48 0.5 0.30 0.31 0.29 0.28 0.18 0.0 F2015 F2016 F2017 F2018
Slide 12: Group operational highlights
Group operational highlights F2021 F2020 Total tonnage milled tonnes 8 145 457 5 752 404 41.6% Own production equivalent refined metal oz 4E 690 867 515 370 34.1% Total refined metal produced oz 4E 655 741 563 977 16.3% Chrome concentrate produced tonnes 1 017 304 782 803 30.0% Cash cost per equival
Slide 13: Zondereinde operations
Zondereinde operations F2021 F2020 Variance Unit % Merensky milled tonnes 1 001 678 681 741 46.9 Merensky head grade g/t 4E 5.7 6.1 (5.8) UG2 milled tonnes 1 127 085 994 383 13.3 UG2 head grade g/t 4E 4.2 4.3 (1.6) Total milled tonnes 2 128 763 1 676 124 27.0 Average combined head grade g/t 4E 4.9 5
Slide 14: Zondereinde Western extension
Zondereinde Western extension Northam Platinum Holdings Limited Results for the year ended 30 June 2021 www.northam.co.za Page 14
Slide 15: Zondereinde Western extension
Zondereinde Western extension Eskom yard 3a ventilation Parking shaft Offices, Water change houses dams 4 Shaft & lamp room 3 Shaft Refrigeration & backfill plants Explosives bay Stores & Surface rock silo salvage yard Material laydown area Diverted road Northam Platinum Holdings Limited Results for
Slide 16: Zondereinde Western extension
Zondereinde Western extension 1km F2021 Unit Production ramp up % 85 Old boundary Target steady state PGM production oz 4E pa 120 000 Target steady state PGM production date year F2023 3 Current PGM production – F2021 oz 4E 70 000 4 5 Total approved capital expenditure Rbn 4.7 6 3# Actual capital ex
Slide 17: Booysendal operations
Booysendal operations F2021 F2020 Variance Unit % Merensky milled tonnes 391 815 406 519 (3.6) Merensky head grade g/t 4E 1.9 2.2 (13.4) North UG2 milled tonnes 2 624 373 2 140 812 22.6 North UG2 head grade g/t 4E 2.9 2.8 4.0 South UG2 milled tonnes 1 479 958 465 810 217.7 South UG2 head grade g/t 4
Slide 18: Booysendal South mine
Booysendal South mine Northam Platinum Holdings Limited Results for the year ended 30 June 2021 www.northam.co.za Page 18
Slide 19: Booysendal South mine update
Booysendal South mine update F2021 Unit Project completion % 92 Target steady state PGM production oz 4E pa 255 000 Target steady state PGM production date year F2023 Current PGM production – F2021 oz 4E 115 164 Total approved capital expenditure Rbn 5.6 Actual capital expenditure to date Rbn 4.8 •
Slide 20: Booysendal Central Merensky (BCM)
Booysendal Central Merensky (BCM) BCM Northam Platinum Holdings Limited Results for the year ended 30 June 2021 www.northam.co.za Page 20
Slide 21: Booysendal BS4
Booysendal BS4 Valley boxcut Ore conveyance to South concentrator Decline development Vent connection To BS3 Northam Platinum Holdings Limited Results for the year ended 30 June 2021 www.northam.co.za Page 21
Slide 22: Eland operations
Eland operations F2021 F2020 Variance Unit % Total milled tonnes 1 520 548 1 063 139 43.0 Head grade g/t 4E 2.5 2.7 (10.3) PGMs in concentrate – own operations oz 4E 32 676 35 123 (7.0) PGMs in concentrate – third parties oz 4E 10 988 1 660 561.9 Total revenue per Pt oz sold R/Pt oz 63 395 37 804 67
Slide 23: Eland mine progress
Eland mine progress F2021 Unit Project completion % 30 Target steady state PGM production oz 4E pa 180 000 4E Target steady state PGM production date year F2028 Current PGM production – F2021 oz 4E 32 676 3E Estimated project capital expenditure Rbn 4.3 (expanded mine plan) 4W Actual capital expendi
Slide 24: Financial review
Financial review www.northam.co.za Page
Slide 25: Key financial features for F2021
Key financial features for F2021 Revenue Operating profit EBITDA R32.6bn R16.1bn R16.7bn (F2020: R17.8bn) Operating profit margin: 49.4% EBITDA margin: 51.0% (F2020: R5.3bn) (F2020: R6.0bn) Net debt Banking facilities Free cash flow R3.7bn R5.0bn R8.9bn Net debt to EBITDA ratio: 0.22 Undrawn at year
Slide 26: Earnings per share
Earnings per share EPS HEPS Normalised HEPS 2 681.8 cents 2 687.9 cents 2 131.9 cents 3 000 3 000 3 000 2 681.8 2 687.9 2 500 2 500 2 500 2 131.9 2 000 2 000 2 000 1 500 1 500 1 500 1 000 1 000 1 000 620.0 619.5 676.3 500 500 500 270.1 17.2 15.8 82.7 - - 0 -201.5 (201.5) (200.5) -200.5 -500 -500 -50
Slide 27: Revenue
Revenue 40 83.2% increase in revenue 35 1.5 (1.6) 14.9 32.6 30 72.8% 25 R14.8bn increase in average 4E basket price to USD3 049 R billions 20 (F2020: USD1 764) 17.8 15 12.2% 10 increase in 4E volumes sold 5 0 Sales revenue Metal prices Sales volumes Exchange rate Sales revenue 4.6% F2020 F2021 stron
Slide 28: Cost of sales
Cost of sales F2021 F2020 Variance R000 R000 % Sales revenue 32 626 918 17 811 971 83.2 Cost of sales (16 519 625) (12 510 983) (32.0) Operating costs (14 484 980) (9 931 934) (45.8) Mining operations (9 003 678) (6 857 044) (31.3) Concentrator operations (1 543 974) (1 284 362) (20.2) Smelting and
Slide 29: Statement of profit or loss
Statement of profit or loss F2021 F2020 Variance R000 R000 % Sales revenue 32 626 918 17 811 971 83.2 Cost of sales (16 519 625) (12 510 983) (32.0) Gross profit 16 107 293 5 300 988 203.9 Share of earnings from associate 6 180 16 358 (62.2) Investment income 90 485 119 220 (24.1) Finance charges ex
Slide 30: Working capital management
Working capital management 42.0% 312 611 oz 4E R6.1bn Increase in metal volumes Metal volumes at year-end Metal inventory balance R1.2bn 39 869 oz 4E 48 803 oz 4E Classified as non-current Purchased material at year-end Non-current inventory inventory to be processed at year-end in future years Nort
Slide 31: Free cash flow generated
Free cash flow generated R12.1bn R3.2bn R8.9bn cash flow generated from capital expenditure incurred free cash generated operating activities during the year Free cash flow will continue to be returned to shareholders Northam Platinum Limited Results for the year ended 30 June 2021 www.northam.co.za
Slide 32: Cash distributed
Cash distributed Returned to Zambezi Preference Shareholders Returned to Zambezi through Preference Share Ordinary Shareholders Period purchases through share purchases Paid in tax Pre F2021 R4.0bn ‒ ‒ F2021 R8.1bn R384.0m ‒ F2022 R2.0bn R2.8bn R3.9bn F2025 ‒ ‒ R1.3bn Total R14.1bn R3.1bn R5.2bn Nor
Slide 33: Net debt to EBITDA
Net debt to EBITDA F2021 F2020 R000 R000 Cash and cash equivalents 3 877 208 2 160 956 Domestic Medium-Term Notes (7 594 235) (5 508 412) RCF and GBF - - Net debt (3 717 027) (3 347 456) EBITDA 16 655 317 6 023 379 Net debt to EBITDA ratio 0.22 0.56 Net debt to EBITDA ratio F2021 F2020 Target 0.22 0
Slide 34: Banking facilities, upgrade to our credit rating
Banking facilities, upgrade to our credit rating RCF GBF DMTN Programme R4.0bn R1.0bn R15.0bn Increased by R500.0m Increased by R500.0m of which R7.8bn issued in F2021 in F2021 as at 30 June 2021 Relaxation of RCF covenants Both the RCF and GBF Upgrade of long and undrawn at year-end short-term cred
Slide 35: Capital allocation
Capital allocation Investing in the business for Working capital Returning value to the future requirements Shareholders R16.3bn R6.1bn R22.4bn Capital expenditure since 2015 Metal inventory Returned via the early maturity of Zambezi R3.3bn R5.0bn R8.5bn Capital expenditure during F2021 Banking faci
Slide 36: Operational guidance
Operational guidance www.northam.co.za Page
Slide 37: Operational guidance for F2022
Operational guidance for F2022 Zondereinde Booysendal Eland Group Metal production Equivalent refined metal Metal in concentrate Metal in concentrate Equivalent refined metal from own operations (oz 4E) 330 000 - 340 000 400 000 - 410 000 30 000 - 40 000 750 000 - 780 000 Metal production from third
Slide 38: 6 monthly average basket price
6 monthly average basket price 90 000 80 000 70 000 60 000 50 000 ZAR / Pt oz 40 000 30 000 20 000 10 000 0 F15 F15 F16 F16 F17 F17 F18 F18 F19 F19 F20 F20 F21 F21 F22 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 Q1 Northam Platinum Holdings Limited Results for the year ended 30 June 2021 www.northam.c
Slide 39: Five year mining production outlook
Five year mining production outlook 1 200 Booysendal Zondereinde Eland Outlook 980 1 000 1 000 920 850 800 770 Equivalent refined koz 4E 691 600 520 515 484 474 437 400 378 200 0 F2015 F2016 F2017 F2018 F2019 F2020 F2021 F2022 F2023 F2024 F2025 F2026 Northam Platinum Holdings Limited Results for the
Slide 40: Market review – quarterly automotive production
Market review – quarterly automotive production 26 24 Quarterly Light Duty Vehicle production (million units) 22 20 18 16 14 12 10 2019 2020 2021 2021 2021 2021 2022 2022 2022 2022 2023/24 Qtrly mean Qtrly mean Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Qtrly mean Northam Platinum Holdings Limited Results for the year
Slide 41: Market review – medium-term outlook
Market review – medium-term outlook A greener, cleaner world needs PGMs Platinum Palladium Rhodium Remains in surplus, Remains in deficit, metal of choice Remains in deficit, good investment case for foreseeable future only solution for NOx Auto sales outlook 2021 Auto production outlook 2021 Substi
Slide 42: Outlook
Outlook Capital allocation Bedding down Health and wellness Growth through and proactive value Extended Empowerment of our employees project execution return to shareholders Transaction Northam Platinum Holdings Limited Results for the year ended 30 June 2021 www.northam.co.za Page 42
Slide 43: Questions?
Questions? Northam Platinum Holdings Limited Results for the year ended 30 June 2021 www.northam.co.za Page 43
Slide 44: Contact details
CONTACT DETAILS Building 4, 1st Floor Maxwell Office Park Magwa Crescent West Shareholder information Waterfall City Name Northam Platinum Holdings Limited Jukskei View 2090 South Africa Share code NPH Tel: +27 11 759 6000 ISIN code ZAE 000298253 Fax: +27 11 325 4795 JSE sector Platinum www.northam.
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