Sibanye Stillwater: Gold operations benefited from gold price

Johannesburg: Sibanye Stillwater has provided an operating update for the quarter ended 31 March 2025 (Q1 2025):

• Group adjusted EBITDA1 increased by 89% to R4.1 billion (US$222 million) reflecting diversification and restructuring benefits
• SA gold operations – leverage to higher gold price drove a 178% increase in adjusted EBITDA1 to R1.8 billion (US$98 million)
• SA PGM operations – cost benefits from restructuring underpinned a 74% increase in adjusted EBITDA1 to R2.5 billion (US$137 million)
• US PGM operations – restructuring improves commercial viability, with anticipated S45X credits further underpinning sustainability
• Century operation – strong performance, contributing Q1 2025 adjusted EBITDA1 of R178 million (US$10 million), with solid outlook for 2025
• Keliber lithium project and GalliCam project designated as ‘Strategic projects’ by the European commission, confirming their strategic significance to Europe
• GalliCam project awarded conditional EUR144 million grant from EU innovation fund
• Review of Keliber lithium project capital requirements concluded. Project capital for 2025 forecast to be EUR300 million (US$326 million/R5.9 billion)
• Keliber lithium project scheduled for hot commissioning of refinery during H1 2026
• Increase in Group cash flow for 2026 forecast, due to completion of construction phase of the Keliber lithium project reducing future capital requirements

There are many pleasing aspects from the Q1 2025 operating results which reinforce the positive trends which were evident in the Group’s operating and financial performance for H2 2024.

The repositioning of the US PGM operations and restructuring of high-cost and end-of-life mines, along with the realignment of the SA regional services to more effectively support the reduced operating footprint in South Africa, has notably improved Group profitability.

Group adjusted EBITDA of R4.1 billion (US$222 million) was 89% higher than adjusted EBITDA of R2.2 billion (US$115 million) for Q1 2024.

The first quarter of the year is also historically a seasonally low production quarter for the SA mining industry, and the 31% or R981 million (US$47 million) increase in Q1 2025 adjusted EBITDA, from adjusted EBITDA for Q4 2024 of R3.1 billion (US$175 million) is a significant change in the financial performance of the Group. This reinforces the trend we noted in our H2 2024 results in February 2025, that Group profitability appeared to have stabilised, with H2 2024 marking the third consecutive 6-month period of consistent Group adjusted EBITDA of between R6.4 to R6.7 billion (US$344 – 357 million) per half year period.

The SA gold operations continued to benefit from high leverage to the increasing gold price for Q1 2025, with adjusted EBITDA increasing by 178% year-on-year to R1.8 billion (US$98 million). Operational challenges which constrained production during Q1 2025, have largely been addressed at Beatrix and Driefontein, with production and costs expected to improve during Q2 2025. Kloof is undergoing a transition to a higher volume, lower grade future production profile, accessing secondary reef horizons, which have largely been unexploited in the past, and is expected to stabilise over a longer period. With the gold price increasing further during Q2 2025, if maintained, profits from the SA gold operations could increase materially.

The SA PGM operations also reversed a declining profitability trend despite the 4E PGM basket price remaining under pressure. Adjusted EBITDA increased by 74% to R2.5 billion (US$137 million) for Q1 2025, driven by solid cost management, which offset inflationary cost pressures and enabled positive financial leverage to a 5% increase in the 4E basket price.

The restructuring of the US PGM operations during Q4 2024, successfully reduced absolute operating cost (excluding provision for S45X credits) by 37% with absolute AISC costs (excluding provision for S45X credits) declining by 44% year-on-year. Despite a marginally lower average 2E PGM basket price for Q1 2025 compared with Q1 2024, on a like-for-like basis (excluding the once off US$43 million (R812 million) insurance payment during Q1 2024 related to the flooding event during mid-2022), adjusted EBITDA for the US PGM operations for Q1 2025 (excluding provision for S45X credits) improved by US$2 million (R31 million) year-on-year to a loss of US$9 million (R172 million).

Including the estimated S45X credit for Q1 2025 of US$6 million (R111 million), the adjusted EBITDA loss would have reduced further, to approximately US$3 million (R55 million) for Q1 2025.

Combined with an estimated S45X credit of US$6 million (R111 million) for the US PGM recycling operations along with a consistent financial contribution from the US PGM recycling operation for Q1 2025 (Adjusted EBITDA of US$4 million), the financial position of the US PGM operations on a combined basis is considerably improved, supporting a more sustainable future for the US PGM operations.