You are currently viewing our desktop site, do you want to download our app instead?
Moneyweb Android App Moneyweb iOS App Moneyweb Mobile Web App

NEW SENS search and JSE share prices

More about the app

Gold producer Pan African Resources revels in record profit

On the back of the commodities boom and despite some Covid-19 constraints.
Image: Bloomberg

Junior gold miner Pan African Resources reported a 69% increase in headline earnings per share (Heps) for the financial year ended 30 June 2021 on Wednesday and slashed its net senior debt by just over 45%, to $33.7 million.

The JSE and London Stock Exchange-listed group revealed in its latest financial results statement that mining profit for the year surged to $128 million, on the back of higher commodity prices and a double-digit increase in production at its mines.

The group increased gold production by 12.4% to 201 777 oz.

It also posted a 34.6% jump in revenue to $368.9m (from $274.1 million in 2020). This is predominantly a result of gold sales increasing 16.1%.

“Our excellent financial performance has improved Heps by 69% and enabled a 45.6% reduction in group net senior debt. We remain on track with our forecast de-gearing, while continuing to invest in our assets and increasing dividends to shareholders,” said Pan African Resources CEO Cobus Loots in a statement.

Read: An underappreciated gold mine that’s worth a closer look

Although Covid-19 disrupted mining operations, the company noted several other highlights. These include the renewal of its Barberton Mines’ mining rights for a 30-year period to May 2051; and, Barberton Mines also successfully concluding a multi-year wage agreement with its representative unions.

“The renewal of Barberton Mines’ mining rights by the Department of Mineral Resources and Energy (DMRE) for a further 30 years endorses our technical work and the long-term LoM [Life of mine] plans submitted for these Mineral Resources,” Loots added.

Listen: Barberton Mines’ mining rights renewed for 30 years

Pan African Resources latest financial results is in-line with the stellar performance of several other mining companies such as Amplats, which reported a 28% increase in metal production in early August.

Diversified resources group Exxaro reported a 106% leap in headline earnings per share for the half year to June, while Royal Bafokeng Platinum announced a 322% surge in gross profit.

“We are, once again, pleased to report major positive strides in Pan African’s operational and financial performance, despite the challenges of the ongoing Covid-19 pandemic,” said Loots.

Listen to Simon Brown’s MoneywebNOW interview with CEO Cobus Loots here:

“The operational flexibility afforded by our multiple producing assets has enabled the group to improve margins, achieve record profits and realise our second-highest annual gold production. We are also proposing our highest-ever dividend for approval at the upcoming annual general meeting,” he added.

Read: Where are the juniors?

At the prevailing exchange rate, the record final proposed dividend is $28.3 million (R402.2 million).

The share price of Pan African Resources closed almost 4% firmer on the JSE on Wednesday, at R3.35. However, the stock is trading over 35% lower for the year to date.

Palesa Mofokeng is a Moneyweb intern.

VIDEOS

COMMENTS   0

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

SEARCH COMPANIES
Enter company name or share code:

ECONOMIC DATA  

  CPIThe Consumer Price Index (CPI) measures monthly changes in prices for a range of consumer products Dec 2021 5.90%
  CPI ex OERThe Consumer Price Index excluding Owners’ Equivalent Rent (CPI ex OER) measures monthly changes in prices for a range of consumer products excluding Owners’ equivalent rent that measures changes in the cost of owner-occupied housing Dec 2021 6.40%
  RepoThe rate at which the Reserve Bank lends money to the country’s commercial banks and set by the Reserve Bank’s Monetary Policy Committee. Jan 2022 3.75%
  Prime lendingThe Prime Lending Rate is the rate of interest that commercial banks will charge their clients when issuing a loan (home loan or vehicle finance) Jan 2022 7.25%
INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us:

Search Articles:
Click a Company: