Pan African Resources Group gold production increased by 6.2% to 186,039oz

Pan African Resources reports that its group gold production increased by 6.2% to 186,039oz (2023: 175,209oz), in line with guidance. Operational enhancements and optimisation initiatives resulted in significant improvements at Barberton Mines’ underground and Elikhulu Tailings Retreatment Plant’s (Elikhulu) surface operations, resulting in annual increases of:

• Gold production from Fairview and Sheba Mines increased by 13.5% to 65,580oz (2023: 57,778oz)
• Elikhulu’s gold production increased by 8.4% to 54,812oz (2023: 50,573oz)

Costs and cost outlook

• All-in sustaining costs (AISCAPM) for the current reporting period of US$1,354/oz (2023: restated US$1,309/oz) at an average exchange rate of US$/ZAR: 18.71, marginally above guidance of between US$1,325/oz to US$1,350/oz, with the delay in commissioning Evander Mines’ subvertical hoisting shaft negatively impacting unit costs
• AISC of US$1,170/oz (2023: restated US$1,132/oz) for our lower-cost operations, which account for more than 84% (2023: 81%) of annual production
• 2025 AISC guidance of between US$1,350/oz and US$1,400/oz (assuming an exchange rate of US$/ZAR:18.50), with the Mogale Tailings Retreatment project’s (MTR project) low-cost production offsetting inflationary pressures

Surface remining operations

The MTR project’s commissioning is in progress, with steady-state production expected by latest December 2024. This US$135.1 million project is expected to be delivered under budget and ahead of schedule. The Barberton Tailings Retreatment Plant’s (BTRP) life-of mine has been extended to seven years (previously two years), following a successful internal project to reassess feedstock sources, further enhancing the Group’s high-margin, long-life surface remining operations.

Underground operations

Evander Mines’ 8 Shaft 24 and 25 Level underground expansion project is now scheduled to be completed by the end of September 2024, following delays in the equipping of the ventilation shaft for hoisting. Equipping the 17 to 24 Level subvertical hoisting shaft will significantly increase efficiencies by reducing reliance on the current cumbersome conveyor belt infrastructure for ore transport

• 24 Level’s refrigeration plant will be commissioned in phases to facilitate mining at depth
• 25 Level mining area access development has commenced

Production guidance

2025 financial year production guidance of 215,000oz to 225,000oz, with the expected increase in production largely attributable to the contribution from the Group’s new MTR project, but potentially impacted by:

• The delay in the commissioning of Evander Mines’ subvertical shaft, scheduled to be completed during September 2024, could impact guidance by approximately 5,000oz
• Evander Mines’ underground vamping operations and earlier production from the MTR project may offset the impact of the above-mentioned delay

Financial

• Revenue increased by 16.8% to US$373.8 million (2023: restated US$319.9 million)
• Profit for the year increased by 30.2% to US$78.8 million (2023: restated US$60.5 million)
• Headline earnings APM increased by 32.1% to US$79.5 million (2023: restated US$60.2 million)

Environmental, social and governance (ESG) initiatives

• The Group continues to lead the way on renewable energy initiatives and establishing a roadmap to decarbonisation
• Construction of Fairview Mine’s solar facility completed at Barberton Mines in June 2024 and hot-commissioned in July 2024
• Renewed power purchase agreement with Sturdee Energy, subject to certain suspensive conditions, with ground clearing for construction having commenced
• Evander Mines’ 3ML/day water recycling plant capacity to be doubled in the next two years
• Rehabilitation at the MTR project’s Mogale and Soweto sites is in progress.