2020 was a defining year for the Group, marking the end of the deleveraging phase that has prevailed over the past three years. Despite the significant challenges associated with the COVID-19 pandemic, the Group delivered a record financial performance and made notable progress towards delivery on many strategic targets.
Despite the ongoing implementation and observance of COVID-19 protocols to support the health and wellbeing of our workforce, production from the three operating segments for 2020 was consistent with the prior year.
The build-up to normalised production levels at the SA operations from the COVID-19 lockdown in Q2 2020 exceeded forecasts despite the adoption of a phased return to work in order to protect the health and safety of employees during this sensitive period. Both the SA gold and PGM operations reached normalised production rates in November 2020, positioning the Group for an improved operational performance in 2021.
The SA PGM operations produced 1,576,507 4Eoz in 2020 (including attributable ounces from Mimosa), exceeding the upper limit of revised annual guidance of between 1,350,000 4Eoz and 1,450,000 4Eoz by 9%, with PGM production of 918,679 4Eoz for H2 2020, 40% higher than for H1 2020.
Mined PGM production from the US PGM operations of 603,067 2Eoz in 2020 was marginally higher year-on-year, but below revised guidance of between 620,000 and 650,000 2Eoz, primarily due to the impact of a spike in COVID-19 infections at the US PGM operations in Q4 2020, associated with a severe wave of COVID-19 infections in Montana.
Despite the COVID-19 disruptions, H2 2020 production of 305,327 2Eoz was 3% higher than for H1 2020, with most operating trends improving towards the end of the year. Production from the SA Gold operations (excluding DRDGOLD) of 25,190kg (809,877oz) was 3% above revised guidance of between 23,500 and 24,500kg (756,000oz and 788,000oz), with production of 15,023kg (483,001oz) for H2 2020, 48% higher than for H1 2020.
This solid operational performance underpinned the record financial results by obtaining full exposure to higher average precious metal prices. The average 4E PGM basket price increased by 83% to R36,651/4Eoz (US$2,227/4Eoz) for 2020 with the average 2E PGM basket price increasing by 36% to US$1,906/2Eoz (R31,373/2Eoz) and the average rand gold price increasing by 43% to R924,764/kg (US$1,747/oz). The average SA exchange rate depreciated by 14% to R16.46/US$ for the year.
Group revenue increased by 75% year-on-year to R127,392 million (US$7,740 million), with H2 2020 revenue of R72,374 million (US$4,439 million) on par with full year revenue of R72,925 million (US$5,043 million) for 2019.
Group adjusted EBITDA for 2020 increased by 230% year-on-year to R49,385 million (US$3,000 million) compared to R14,956 million (US$1,034 million) for 2019.
This resulted in profit attributable to owners of Sibanye-Stillwater, increasing 472 fold from R62 million (US$5 million) for 2019 to R29,312 million (US$1,781 million).
Sibanye-Stillwater’s economic contribution to the regions in which we operate grew commensurately to our profitability, with royalties increasing by 310% to R1,765 million (US$107million) for 2020 from R431 million (US$30 million) for 2019 and current mining tax increasing from R1,849 million (US$128 million) for 2019 to R5,374 million (US$327 million) for 2020.
The Group deleveraging was successfully achieved during the year, with borrowings reducing by R5,354 million (US$444 million) to R18,383 million (US$1,251 million) and cash and cash equivalents increasing to R20,240 million (US$1,378 million).
On a trailing 12 month basis, adjusted EBITDA increased by 230% to R49,385 million (US$3,000 million) resulting in net cash: adjusted EBITDA ratio of 0.06x compared to net debt: adjusted EBITDA of 1.25x at the end of 2019.