Pan
African Resources PLC Pan
African Resources Funding Company
(Incorporated
and registered in England and
Wales Limited
under
Companies Act 1985 with registered Incorporated
in the Republic of South
Africa
number
3937466 on 25 February
2000) with
limited liability
Share code
on AIM: PAF Registration
number: 2012/021237/06
Share code
on JSE: PAN Alpha
code: PARI
ISIN:
GB0004300496
ADR code:
PAFRY
(“Pan
African” or “the Company” or “the Group”)
OPERATIONAL
UPDATE FOR THE HALF YEAR ENDED DECEMBER
2023 (H1 FY2024)
Pan
African is pleased to provide its shareholders and noteholders with
a production update for the half year ended 31 December 2023 (Reporting Period) and
information on progress being made with the construction of the
processing plant at the Mogale Tailings Retreatment project (MTR
Project).
KEY
FEATURES
-
Improvement
in overall Group safety performance
-
Gold price
received of US$1,961/oz (2022:
US$1,725/oz), an increase of 13,7%
relative to the six months ended 31 December
2022 (Previous Reporting Period)
-
Excellent
operational results, with gold production of 98,458oz (2022:
92,307oz), an increase of 6.7% relative to the Previous Reporting
Period
-
Production
costs were well managed despite inflationary pressures, with Group
all-in sustaining costs (AISC) expected to be approximately
US$1,300/oz at an average exchange
rate of US$/ZAR18.69, below the
FY2024 guidance of US$1,350/oz (at an
assumed exchange rate of US$/ZAR18.50)
-
MTR
Project construction on time and within budget, with commissioning
expected in the latter half of the 2024 calendar year
-
Commissioning
of further renewable energy generating capacity is on
schedule.
SAFETY
AND GROUP GOLD PRODUCTION FOR SIX MONTHS ENDING DECEMBER 2023
-
The Group
continues to implement initiatives in pursuit of its ‘Zero Harm’
goal
- Group
safety rates remain industry leading:
- Total
recordable injury frequency rate (TIFR) declined to 6.13 per
million man hours (FY2022: 8.54), a notable improvement
-
Operations
performed in line, or better than expected, with production
forecast for the Reporting Period, as follows:
- Barberton
Mines underground: 36,779oz* (2022: 32,022oz). The implementation
of continuous operations at Barberton Mines contributed to
increases in mined tonnages and grades, when compared to the
Previous Reporting Period
-
Evander Mines underground: 21,307oz (2022: 19,173oz). The
ramping up of mining operations at Evander Mines’ 24 Level
underground operations contributed to the increased gold
production, successfully replacing the depletion of the 8 Shaft
pillar ore resources, consistent with the mine plan
- Elikhulu
tailings retreatment: 28,106oz (2022: 25,830oz), with operations
benefitting from improved metallurgical recoveries
- Barberton
tailings retreatment plant (BTRP): 9,864oz (2022:
10,012oz)*
- Evander
Mines’ surface sources: 2,401oz (2022: 5,270oz).
*
Surface sources from Fairview Mine included in BTRP
production
PRODUCTION
GUIDANCE
-
Production
guidance for the full 2024 year is maintained at between 180,000oz
to 190,000oz (FY2023: 175,209oz). However, given the excellent
production performance in the Reporting Period, revised guidance
may be considered in due course. Production for FY2025 is expected
to be significantly higher, following commissioning of the MTR
project, which will add approximately 50,000oz/yr to Group
production, increasing annual output by some 25%.
FINANCIAL
RESULTS
-
The
Group’s AISC for the Reporting Period is expected to be
approximately US$1,300/oz, at an
average exchange rate of US$/ZAR18.69
- The AISC
reduction resulted from excellent cost control, improved gold
production, as well as the weaker US$/ZAR exchange rate that
prevailed during the Reporting Period
-
Group net
senior debt increased to US$60.0
million (June 2023:
US$18.9 million), primarily as a
result of the capital expenditure of US$23.2
million incurred on the MTR Project and the dividend of
US$22.1 million paid to shareholders
in December 2023.
MTR
PROJECT
-
As
previously communicated, significant progress has been made with
the construction of the MTR Project’s processing plant, with
commissioning being on track for the latter half of the 2024
calendar year and steady state production expected by December 2024:
- Construction
is progressing on time and capital expenditure is in line with the
project’s budget
- Construction
highlights include completion of the laying of foundations for the
nine CIL tanks and the tower crane’s construction.
UPDATE
ON THE ORGANIC GROWTH PROJECTS
-
Progress
at Evander Gold Mine’s 24 to 26 Level underground expansion project
remains on track, with the following notable achievements:
- Construction
of Phase 2 of the refrigeration plant on 24 Level at Evander Mines’
8 Shaft is currently at an advanced stage, with completion
anticipated during the 2024 financial year, as 25 Level mining
operations commence
- Development
to access 25 and 26 Level mining areas has commenced
- Equipping
of the existing 17 Level underground ventilation shaft, with a
hoisting capacity of up to 40,000 tpm, is expected to be completed
during FY2024, improving efficiencies and eliminating the existing
cumbersome conveyor system
-
Dewatering
of Evander’s 7 Shaft Egoli project is ongoing. Once dewatered to
below 20 Level, reserve delineation drilling will commence to
further define the ore payshoot and its grade
variability.
ESG
UPDATES
-
Construction
of Fairview Mine’s 8.75MW solar energy plant is progressing
according to plan, with commissioning expected during June 2024
-
Community
social and labour plan projects:
- Barberton
Mines completed the construction and refurbishment of two local
schools, benefitting over 1,600 learners
-
Evander Mines constructed and fully equipped science and
computer laboratories at two local schools, benefitting over 1,200
learners
-
MTR
Project:
- Community
engagement structures and social initiatives have commenced with
host communities and small local businesses
- Environmental
rehabilitation is ongoing, including cleanup of historical
spillages and removal of derelict pipelines, eradication of alien
vegetation and wetlands remediation, which positively impacts local
living conditions.
Cobus Loots, Pan African’s CEO commented:
“We
are pleased with the Group’s excellent safety, production and cost
performance for the Reporting Period which positions us
well to
deliver on our guidance for the full financial year. Commissioning
of the world-class processing plant at the MTR Project towards the
end of this calendar year will further increase the Group’s
production with approximately 50,000 oz per year of high margin
ounces.
The
commissioning of Barberton’s solar PV plant will contribute to
further cost savings in the next financial year, adding to the
benefits already being realised from Evander’s PV solar plant. We
are also excited by the positive and tangible impact the Group’s
ESG projects have made on improving relationships with our host
communities and contributing to the sustainability of these
areas.”
INTERIM
RESULTS PRESENTATION, OPERATIONAL AND GROWTH PROJECTS
UPDATE
A detailed
update on the Group’s operations and capital projects will be
included in the Company’s interim results presentation, scheduled
for release on 14 February
2024.
The
information contained within this announcement is deemed by the
Company to constitute inside information as stipulated under the
Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK
Domestic Law by virtue of the European Union (Withdrawal) Act 2018.
Upon the publication of this announcement via Regulatory
Information Service (RIS), this inside information is now
considered to be in the public domain.
Rosebank
22 January 2024
For
further information on Pan African Resources, please visit the
Company's website at
www.panafricanresources.com
Corporate
information
|
Corporate
Office
The Firs
Office Building
2nd Floor,
Office 204
Cnr.
Cradock and Biermann Avenues
Rosebank,
Johannesburg
South
Africa
Office: +
27 (0)11 243 2900
info@paf.co.za
|
Registered
Office
107
Cheapside
Second
Floor
London
EC2V
6DN
United
Kingdom
Office: +
44 (0)20 7796 8644
|
Chief
Executive Officer
Cobus
Loots
Office: +
27 (0)11 243 2900
|
Financial
Director
Deon
Louw
Office: +
27 (0)11 243 2900
|
Head:
Investor Relations
Hethen
Hira
Tel: + 27
(0)11 243 2900
E-mail:
hhira@paf.co.za
|
Website:
www.panafricanresources.com
|
Company
Secretary
Jane
Kirton
St
James's Corporate Services Limited
Office: +
44 (0)20 7796 8644
|
Nominated
Adviser and Joint Broker
Ross
Allister/Bhavesh Patel
Peel
Hunt LLP
Office:
+44 (0)20 7418 8900
|
JSE
Sponsor
Ciska
Kloppers
Questco
Corporate Advisory Proprietary Limited
Office: +
27 (0)11 011 9200
|
Joint
Broker
Thomas
Rider/Nick Macann
BMO
Capital Markets Limited
Office:
+44 (0)20 7236 1010
|
|
Joint
Broker
Matthew
Armitt/Jennifer Lee
Joh.
Berenberg, Gossler & Co KG (Berenberg)
Office:
+44 (0)20 3207 7800
|