Anglo Platinum’s record-breaking performance aided by surging PGM prices

PGM prices were up 22% in 2021, helping the group to a record R108bn in earnings.
The miner saw a 22% improvement in the basket price for PGMs to R44 511 per oz, against a unit cost of R12 831 per oz. Image: Siphiwe Sibeko/Reuters

Anglo Platinum (Amplats) reported record earnings for the year to December 2021 with a cash dividend of R300 per share for the full year, more than six times the previous year’s payout.

There were smiles all round as CEO Natascha Viljoen went through the accomplishments of the year at the results presentation on Monday.

There is very little to quibble with in the numbers: Ebitda (earnings before interest, tax, depreciation and amortisation) came in at R108 billion, smashing all previous records (2020: R41.6 billion) while return on capital employed was 183% (2020: 72%).

This was Viljoen’s second year announcing the results for the world’s largest platinum group metals (PGM) producer, and fortune has certainly been on her side, with a 22% improvement in the rand basket price for PGMs to R44 511 per ounce, against a unit cost of R12 831 per ounce.

This was achieved despite 13% higher production to 4.3 million ounces for the year.

In the previous year (2020), the unit cost per PGM ounce produced was just below R11 800, against a rand basket price of R33 320/oz, which was 71% up on 2019.

In 2021, the unit cost per PGM ounce was up just 9% to R12 831, despite 13% higher production for the year. The increase includes input cost inflation of 14%, made up of labour cost increases of 7%, electricity of 14% and steel of 47%.


With margins like that, the temptation is to give inflation some slack, but even here Anglo Platinum battened down the hatches, with capital expenditure at R6.4 billion for 2021.

Some R500 billion went on repairs to the Anglo Converter Plant (ACP), which caused a 42% drop in refined production to 2.7 million ounces in 2020 following an explosion, with R350 million recovered from insurance.

Those setbacks are now clearly a thing of the past.

Listen: CEO Natascha Viljoen discusses Amplats’s annual results


Anglo Platinum almost doubled its refined production to 5.2 million ounces in 2021, in part due to processing of inventory built up as a result of the converter plant explosion, and record throughputs from a sleeker refining plant.

This led to an 82% increase in sales volumes to just over 5.2 million ounces.

Total capex for 2021 was R13.6 billion, of which:

  • R7.3 was ‘stay-in-business’ capex (linked to existing rather than new projects);
  • R2 billion was spent on breakthrough projects;
  • R3 billion on capitalised waste stripping; and
  • R1.2 billion on growth and life-extension projects.

The company ended the year with net cash of R49.1 billion after paying dividends of R55.7 billion and R34.8 billion in taxes and royalties.

Key areas of focus in the coming year are the mechanisation and modernisation of Amandelbult, extending the life of mine beyond 30 years at Mototolo/Der Brochen in Limpopo, and de-bottlenecking of the ACP plant to facilitate the processing of higher volumes of base metals coming out of Mogalakwena, also in Limpopo.

“We have the largest processing capability in the PGMs industry, and our integrated value chain creates optionality with significant potential,” says Viljoen.

“We will focus our capital decisions across the portfolio to ensure we maximise our full value potential, including progressing the Future of Mogalakwena work, which continues to evolve as we progress.”

One potential bottleneck to future sales – the shortage of chips available to car makers – appears to be easing, with Anglo Platinum expecting car sales in 2023 to exceed pre-Covid levels.

Short term: easing chip shortage allows rising auto production

Source: Amplats 2022 results presentation (click to enlarge)

Looking to the year ahead, Viljoen expects PGM demand to rise on the back of a recovery in light-duty vehicles production, offset by a modest increase in PGM supply, primarily from recycled autocatalysts as more cars are scrapped.

After a superb 2021, refined production is likely to normalise around 4.2-4.6 million ounces. Unit costs per ounce are likely to range between R13 800 and R14 500, with capex for the coming year expected to top R18 billion.

Anglo Platinum is now trading at more than three times the crash in price immediately after the announcement of Covid lockdowns, though this is still more than 10% off the highs reached more than a year ago in March 2021 on the back of higher PGM prices.

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