Sibanye-Stillwater: Guidance for PGM unchanged, for gold suspended

Notwithstanding the prevailing global geopolitical uncertainties, precious metal prices have remained robust, albeit with significant volatility, and, underpinned by a strong operating performance from its SA PGM operations, Group adjusted EBITDA of R13.7 billion (US$898 million) for Q1 2022 was strong, albeit 31% lower than for Q1 2021 (which at the time was a record quarterly financial result).

On an annualised basis, Q1 2022 adjusted EBITDA equates to approximately R55 billion (US$3.6 billion). This is well above adjusted EBITDA for 2020 of R49.4 billion (US$3 billion) and R15 billion (US$1 billion) for 2019. Other than the record adjusted EBITDA of R68.6 billion (US$4.6 billion) for 2021, the Q1 2022 annualised adjusted EBITDA is the highest since the inception of the Group, signalling a significant and sustainable transformation in the financial position and outlook of the Group.

Sibanye-Stillwater value creation journey and solid financial position, was recently confirmed by a meaningful upgrade in the Group’s credit rating by Moody’s Investors Service at the end of April 2022 from Ba3 to Ba2 with a positive outlook.

Another highlight for the quarter, was Sibanye-Stillwater’s re-inclusion in the Bloomberg Gender-Equality Index (GEI) at the end of January 2022, an affirmation of progress in Sibanye-Stillwater inclusivity journey. Subsequent to the inclusion in the GEI, its senior leadership was further diversified and strengthened with two out of three executive-level promotions awarded to women from historically disadvantages backgrounds during the period.

OPERATING GUIDANCE FOR 2022

4E PGM production from the SA PGM operations for 2022 remains unchanged at between 1,750,000 4Eoz and 1,850,000 4Eoz with AISC between R18,500/4Eoz and R19,200/4Eoz (US$1,233/4Eoz and US$1,280/4Eoz). Capital expenditure is forecast at R4,800 million (US$317 million) including R950 million (US$63 million) of project capital expenditure on the K4 project.

Forecast mined 2E PGM production from the US PGM operations for 2022 currently remains unchanged at between 550,000 2Eoz and 580,000 2Eoz, with AISC of between US$980/2Eoz to US$1,030/2Eoz. Capital expenditure is forecast to be between US$290 million and US$310 million (including US$70 million of project capital). As mentioned, management is currently undertaking an optimisation planning process to ensure an appropriate ongoing return on capital invested is achieved in the current and medium-term environment. The results of this study are expected by mid-year 2022 and will inform future guidance.

The US Recycling operations are forecast to feed between 750,000 and 800,000 3Eoz. Capital expenditure is forecast at approximately US$3 million.

Annual guidance for the SA gold operations is suspended due to the ongoing lockout. Guidance will be revised and updated on the lifting of the lockout.

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