Northam Platinum: Booysendal reached steady production, Eland ramp-up on schedule

Northam Holdings’ financial results for the six-months ended 31 December 2024 (“H1 F2025”) are underpinned by a solid production performance. A key feature of the period is the steady and robust production volumes delivered by all operations. Zondereinde benefitted from focussed Merensky stoping in the Western extension, together with logistical decongestion resulting from the ongoing shift in UG2 stoping from the western to the higher yielding eastern portions of the mine. Booysendal has reached its steady state production profile and is now focussing on productivity and efficiency gains, whilst Eland continues to ramp-up on schedule.
The group’s equivalent refined metal from own operations increased by 3.7% to 451 213 oz 4E (H1 F2024: 434 977 oz 4E). Strong production growth was recorded at Eland, despite safety stoppages. Zondereinde achieved marginal production improvements, ahead of commissioning 3 shaft and despite an Eskom power outage during November 2024. Booysendal production also improved as a result of productivity gains. These achievements continue to demonstrate the quality of our operations and orebodies.
Group production of chrome concentrate increased by 7.5% to 716 622 tonnes (H1 F2024: 666 692 tonnes), as a result of improvements in UG2 tonnage throughput, feed grades and concentrator yields, and a notable increase at Eland.

Mining tonnages and grades across the group are expected to improve further over the coming two years upon our growth and innovation projects reaching completion and achieving their planned targets. These improvements, together with an expected increase in mineable reserves, will provide important additional operational flexibility.

KEY METRICS

• 3.7% increase in equivalent refined metal from own operations to 451 213 oz 4E (H1 F2024: 434 977 oz 4E), following a strong performance from all mines, including a 15.1% increase in 4E metal in concentrate produced from own operations and surface sources at Eland to 37 488 oz 4E (H1 F2024: 32 574 oz 4E).
• 2.5% decrease in refined metal produced to 425 151 oz 4E (H1 F2024: 436 178 oz 4E) due to the planned rebuild of furnace 2.
  7.7% increase in group unit cash costs per equivalent refined 4E ounce to R25 381/oz 4E (H1 F2024: R23 562/oz 4E), reflecting  the impact of mining inflation and lower refined metal volumes during the first half of H1 F2025.
• 3.1% decrease in sales revenue to R14.5 billion (H1 F2024: R15.0 billion), primarily attributable to a 3.3% decrease in the 4E ZAR basket price to R23 457/oz 4E (H1 F2024: R24 269/oz 4E).
• 7.5% increase in chrome concentrate sales to 716 622 tonnes (H1 F2024: 666 692 tonnes).
• 55.2% decrease in operating profit to R1.1 billion (H1 F2024: R2.4 billion).
• Net debt as at 31 December 2024 of R6.1 billion with a net debt to EBITDA ratio of 1.26.

Commodity markets are known for their cyclicality. The current outlook for global PGM demand and supply remains uncertain which in turn results in an uncertain outlook for PGM prices. A raft of global geopolitical and macro-economic issues have the potential to cause further disruption to the PGM markets and metal prices, whilst the possibility of Eskom load curtailment events could lead to additional operational disruption and challenges.

The prevailing low PGM price environment is constraining earnings across the entire PGM sector. The sector’s ability to respond to lower PGM prices by suspending or reducing costs is limited, as the majority of mining costs are fixed in nature. This is consequently constraining cash generation across the sector, requiring ever more prudent management of liquidity.