REG-Pan African Resources Plc: Interim Results for the 6 months ended 31 Dec 2017 <Origin Href="QuoteRef">PAFR.L</Origin> - Part 2
13/02/2018 07:05
- Part 2: For the preceding part double click ID:nPRrC403Ba
shares during the current reporting period.
GOING CONCERN
The board confirms that the business is a going concern and that it has
reviewed the group’s working capital requirements in conjunction with its
future funding capabilities for at least the next twelve months and has found
them to be adequate. The group has a R1 billion revolving credit facility from
a consortium of South African banks as well as access to general banking
facilities of R100 million. At 31 December 2017, the group had borrowing
capacity on the revolving credit facility of R325 million (GBP19.5 million) to
assist in funding working capital requirements. The group is exposed to a
number of macro-economic risk, including the gold price and the prevailing
ZAR:USD exchange rate. Furthermore, the group is exposed to industrial action
and an uncertain regulatory environment, which may have an adverse impact on
the group’s future results. Management is not aware of any other material
uncertainties which may cast significant doubt on the group’s ability to
continue as a going concern. Should the need arise, the group can cease
discretionary exploration and certain capital expenditure activities to
conserve cash on the short to medium term and curtail loss making operations.
EVENTS AFTER THE REPORTING PERIOD
The group entered into a restructured BEE transaction on 16 January 2018 in
terms of which the current BEE equity shareholdings in the company (held via
interests in PAR Gold Proprietary Limited (“PAR Gold”)) was replaced with
BEE shareholdings in Emerald Panther Investments 91 Proprietary Limited (“SA
Holdco”), a subsidiary of the Company (the “Transaction”). SA Holdco
will house all Pan African’s South African mining operations, following
implementation of the Transaction. Where the previous BEE ownership
structure terminates during December 2018, the new BEE structure will only
terminate on 31 December 2021, which is a three-year extension of the original
BEE transaction. Refer to the groups’ new organisational structure at
https://www.panafricanresources.com/about-overview/company-structure/.
SEGMENT REPORTING
A segment is a distinguishable component of the group engaged in providing
products or services in a particular business sector or segment, which is
subject to risks and rewards different from those of other segments. The
group's business activities were conducted through the following business
segments:
Continuing operations:
- Barberton Mines (including BTRP), located in Barberton, South Africa;
- Evander Mines (including ETRP and Elikhulu), located in Evander, South
Africa;
- Corporate; and
- Pan African Resources Funding Company Proprietary Limited (“Funding
Company”).
Discontinued operations:
- Phoenix, located near Rustenburg, South Africa, disposed of during the
current reporting period; and
- Uitkomst Colliery, located in Newcastle, South Africa, disposed of during
the prior reporting period.
The executive committee reviews the operations in accordance with the
disclosures presented above.
Cobus Loots Deon Louw
Chief Executive Officer Financial Director
13 February 2018
Pan African Resources Plc
Condensed statement of profit or loss and other comprehensive income for the six month period ended 31 December 2017 #DIV/0!
31 December 2017 31 December 2016 31 December 2017 31 December 2016
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
GBP millions GBP millions ZAR millions ZAR millions
Revenue 82.9 90.1 1,462.9 1,610.8
Gold sales 82.9 90.1 1,462.9 1,610.8
Realisation costs (1.5) (1.5) (27.1) (27.7)
On - mine revenue 81.4 88.6 1,435.8 1,583.1
Gold cost of production (69.6) (65.2) (1,228.0) (1,165.6)
Mining depreciation (5.9) (5.7) (104.8) (101.5)
Mining profit 5.9 17.7 103.0 316.0
Other (expenses)/income (0.8) 1.9 (13.3) 34.9
Profit on disposal of investment - 0.3 - 4.6
Royalty costs (0.3) (0.9) (6.1) (16.7)
Net income before finance income and finance costs 4.8 19.0 83.6 338.8
Finance income 0.7 0.1 13.3 1.1
Finance costs (0.8) (1.1) (14.3) (19.0)
Profit before taxation 4.7 18.0 82.6 320.9
Taxation (1.0) (5.1) (17.6) (90.4)
Profit after taxation 3.7 12.9 65.0 230.5
Discontinued operations
(Loss)/profit from discontinued operations (0.4) 1.1 (6.8) 19.3
Profit after taxation 3.3 14.0 58.2 249.8
Other comprehensive income:
Fair value movement on available for sale investment (2.2) (0.3) (36.1) (6.3)
Foreign currency translation differences 2.7 22.4 - -
Total comprehensive income for the period 3.8 36.1 22.1 243.5
Profit attributable to:
Owners of the parent 3.3 14.0 58.2 249.8
Total comprehensive income attributable to:
Owners of the parent 3.8 36.1 22.1 243.5
Earnings per share 0.18 0.93 3.23 16.58
Diluted earnings per share 0.18 0.93 3.23 16.57
Weighted average number of shares in issue 1,798.3 1,506.8 1,798.3 1,506.8
Diluted number of shares in issue 1,798.9 1,507.6 1,798.9 1,507.6
Condensed consolidated statement of financial position as at 31 December 2017
31 December 2017 30 June 2017 31 December 2016 31 December 2017 30 June 2017 31 December 2016
(Unaudited) (Audited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
GBP million GBP million GBP million ZAR million ZAR million ZAR million
ASSETS
Non-current assets
Property, plant and equipment and mineral rights 263.7 224.7 228.0 4,396.0 3,810.7 3,854.0
Other intangible assets 0.1 0.1 0.1 1.8 1.2 2.1
Deferred taxation asset 0.5 0.8 1.6 7.7 12.9 27.1
Long-term inventory 0.7 0.7 0.2 11.6 11.6 3.7
Long-term receivables 2.6 2.5 - 42.8 43.0 -
Goodwill 21.0 21.0 21.0 303.5 303.5 303.5
Investments 5.5 7.5 - 91.5 127.6 -
Rehabilitation trust fund 21.3 18.9 19.0 357.5 320.6 319.5
315.4 276.2 269.9 5,212.4 4,631.1 4,509.9
Current assets
Inventories 4.0 5.1 6.2 66.0 85.6 105.4
Current taxation asset 0.8 1.1 0.9 13.5 18.1 14.9
Trade and other receivables 14.7 13.7 16.4 244.7 233.1 276.8
Financial instruments assets 0.3 0.0 0.0 5.8 - -
Cash and cash equivalents 7.1 9.4 4.0 118.7 160.2 68.4
26.9 29.3 27.5 448.7 497.0 465.5
Non-current assets held for sale - 5.6 0.1 - 95.2 1.3
TOTAL ASSETS 342.3 311.1 297.4 5,661.1 5,223.3 4,976.7
EQUITY AND LIABILITIES
Capital and reserves
Share capital 22.3 22.3 19.4 318.8 318.8 269.7
Share premium 145.4 145.4 108.9 2,261.4 2,261.4 1,638.6
Translation reserve (34.2) (36.8) (36.2) - - -
Share option reserve 1.2 1.2 1.2 17.2 17.2 17.2
Retained earnings 126.6 131.3 127.4 1,776.4 1,867.0 1,806.9
Realisation of equity reserve (10.7) (10.7) (10.7) (140.6) (140.6) (140.6)
Treasury capital reserve (25.4) (25.4) (25.4) (548.6) (548.6) (548.6)
Merger reserve (10.7) (10.7) (10.7) (154.7) (154.7) (154.7)
Other reserves (2.2) - - (36.1) - -
Equity attributable to owners of the parent 212.3 216.6 173.9 3,493.8 3,620.5 2,888.5
Non-current liabilities
Long-term provisions 11.9 11.7 12.1 198.1 197.7 205.8
Long-term liabilities 43.7 12.3 29.6 729.1 208.4 499.9
Deferred taxation liability 40.3 38.9 49.7 671.1 660.5 839.3
95.9 62.9 91.4 1,598.3 1,066.6 1,545.0
Current liabilities
Trade and other payables 27.6 27.1 21.6 460.2 458.9 365.7
Financial instruments liabilities - - 1.2 - - 20.2
Current portion of long-term liabilities 5.6 4.1 7.7 93.3 70.3 130.0
Current taxation liability 0.9 - 1.6 15.5 0.8 27.3
34.1 31.2 32.1 569.0 530.0 543.2
Liabilities directly associated with assets held for sale - 0.4 - - 6.2 -
TOTAL EQUITY AND LIABILITIES 342.3 311.1 297.4 5,661.1 5,223.3 4,976.7
Condensed consolidated statement of changes in equity for the six month period ended 31 December 2017
Six months ended 31 December 2017 (Unaudited) Six months ended 31 December 2016 (Unaudited) Six months ended 31 December 2017 (Unaudited) Six months ended 31 December 2016 (Unaudited)
GBP million GBP million ZAR million ZAR million
Shareholder's equity as start period 216.6 151.0 3,620.5 2,874.4
Share option reserve - 0.1 - 3.2
Other comprehensive income/(expense) 0.4 22.1 (36.1) (6.3)
Profit for the period 3.3 14.0 58.2 249.8
Dividends paid (10.0) (17.1) (185.0) (300.0)
Reciprocal dividend 2.0 3.8 36.2 67.4
Total equity 212.3 173.9 3,493.8 2,888.5
Condensed consolidated cash flow statement for the six month period ended 31 December 2017
Six months ended Six months ended Six months ended Six months ended
31 December 2017 31 December 2016 31 December 2017 31 December 2016
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
GBP million GBP million ZAR million ZAR million
Profits before tax continuing operations 4.7 18.3 82.6 328.4
(Losses)/profits from discontinued operations (0.2) 1.1 (7.6) 19.3
Profits from operations 4.5 19.4 75.0 347.7
Summary of adjustments:
Royalties 0.3 1.0 6.1 17.3
Depreciation (note 1) 6.0 6.5 105.2 115.8
Gold loan deliveries (1.5) (1.6) (26.6) (27.9)
Fair value adjustments - (5.0) 4.0 (89.3)
Net finance costs 0.1 1.0 1.0 18.0
Operating profit before working capital changes 9.4 21.3 164.7 381.6
(Increase)/decrease in trade and other receivables (0.9) (2.3) (11.5) 0.9
Increase/(decrease) in inventory 1.1 (1.8) 19.6 (18.3)
Increase in trade and other payables 0.5 3.3 14.7 7.4
Effect of foreign exchange rate changes on working capital (0.6) (0.3) - -
Net cash generated by operations before taxation, royalty and finance costs 9.5 20.2 187.5 371.6
Taxation refund/(paid) 0.4 (3.5) 7.6 (59.6)
Royalty paid (0.4) (1.1) (6.5) (18.7)
Net finance costs paid (0.6) (1.0) (10.6) (17.0)
Net cash generated by operations after taxation, royalty and finance costs 8.9 14.6 178.0 276.3
Dividends paid (10.2) (17.1) (185.0) (300.0)
Reciprocal dividend 2.1 3.9 36.1 67.4
Cash inflow from operating activities 0.8 1.4 29.1 43.7
Cash outflow from investing activities (36.2) (9.5) (634.2) (173.1)
Cash inflow from financing activities 32.3 8.8 563.6 145.2
Net (decrease)/increase in cash equivalents (3.1) 0.7 (41.5) 15.8
Cash at the beginning of period 9.4 2.6 160.2 52.6
Effect of foreign currency rate changes 0.8 0.7 - -
Cash and cash equivalents at end of period 7.1 4.0 118.7 68.4
Note 1: Depreciation comprises mining and non-mining depreciation.
Condensed GBP Segment Report for the six month period ended 31 December 2017
31 December 2017
Continuing operations Discontinued operations
Barberton Mines Evander Mines Corporate Funding Company Phoenix (Note 4) Reclassification Group
GBP million GBP million GBP million GBP million GBP million GBP million GBP million
Revenue
Gold sales (Note 1) 39.7 43.2 - - - - 82.9
Platinum sales - - - - 1.4 (1.4) -
Coal sales - - - - - - -
Realisation costs (0.2) (1.3) - - - - (1.5)
On - mine revenue 39.5 41.9 - - 1.4 (1.4) 81.4
Gold cost of production (32.0) (37.6) - - - - (69.6)
Platinum cost of production - - - - (1.6) 1.6 -
Coal cost of production - - - - - - -
Depreciation (2.2) (3.7) - - - - (5.9)
Mining Profit 5.3 0.6 - - (0.2) 0.2 5.9
Other (expenses)/income (Note 2) (0.4) 1.1 (1.5) - - - (0.8)
Profit on disposal of investment - - - - - - -
Loss on sale of asset held for sale - - - - (0.3) 0.3 -
Royalty costs (0.2) (0.1) - - - - (0.3)
Net income / (loss) before finance income and finance costs 4.7 1.6 (1.5) - (0.5) 0.5 4.8
Finance income 0.1 0.4 0.2 - - - 0.7
Finance costs - - - (0.8) - - (0.8)
Profit /(loss) before taxation 4.8 2.0 (1.3) (0.8) (0.5) 0.5 4.7
Taxation (0.5) (0.1) (0.4) - 0.1 (0.1) (1.0)
Profit /(loss) after taxation before inter-company charges 4.3 1.9 (1.7) (0.8) (0.4) 0.4 3.7
Profit/(loss) after taxation from discontinued operations - - - - - (0.4) (0.4)
Profit /(loss) after taxation before inter-company charges 4.3 1.9 (1.7) (0.8) (0.4) - 3.3
Inter-company transactions
Management fees (0.8) (0.2) 1.1 (0.1) - - -
Inter-company interest charges (0.2) (0.3) (0.2) 0.7 - - -
Profit /(loss) after taxation after inter-company charges 3.3 1.4 (0.8) (0.2) (0.4) - 3.3
Segmental assets (Total assets excluding goodwill) 75.5 230.4 10.3 5.2 - - 321.4
Segmental liabilities 27.8 52.8 2.7 46.6 - - 129.9
Goodwill 21.0 - - - - - 21.0
Net assets (excluding goodwill) 47.7 177.6 7.6 (41.4) - - 191.5
Capital expenditure 4.0 35.1 - - 0.3 - 39.1
31 December 2016
Continuing operations Discontinued operations
Barberton Mines Evander Mines Corporate Funding Company Phoenix Uitkomst (Note 3) Reclassification Group
GBP million GBP million GBP million GBP million GBP million GBP million GBP million GBP million
Revenue
Gold sales (Note 1) 48.8 41.3 - - - - - 90.1
Platinum sales - - - - 2.4 - (2.4) -
Coal sales - - - - - 12.6 (12.6) -
Realisation costs (0.3) (1.2) - - - - - (1.5)
On - mine revenue 48.5 40.1 - - 2.4 12.6 (15.0) 88.6
Gold cost of production (29.4) (35.8) - - - - - (65.2)
Platinum cost of production - - - - (2.3) - 2.3 -
Coal cost of production - - - - - (10.6) 10.6 -
Depreciation (2.5) (3.2) - - (0.4) (0.3) 0.7 (5.7)
Mining Profit 16.6 1.1 - - (0.3) 1.7 (1.4) 17.7
Other (expenses)/income (Note 2) 4.5 (0.5) (2.1) - 0.1 - (0.1) 1.9
Profit on disposal of investment - - 0.3 - - - - 0.3
Loss on sale of asset held for sale - - - - - - - -
Royalty costs (0.7) (0.2) - - - - - (0.9)
Net income / (loss) before finance income and finance costs 20.4 0.4 (1.8) - (0.2) 1.7 (1.5) 19.0
Finance income - - - 0.1 - - - 0.1
Finance costs - - - (1.1) - - - (1.1)
Profit /(loss) before taxation 20.4 0.4 (1.8) (1.0) (0.2) 1.7 (1.5) 18.0
Taxation (5.4) 0.1 0.2 - 0.1 (0.5) 0.4 (5.1)
Profit /(loss) after taxation before inter-company charges 15.0 0.5 (1.6) (1.0) (0.1) 1.2 (1.1) 12.9
Profit/(loss) after taxation from discontinued operations - - - - - - 1.1 1.1
Profit /(loss) after taxation before inter-company charges 15.0 0.5 (1.6) (1.0) (0.1) 1.2 - 14.0
Inter-company transactions
Management fees (0.6) (0.6) 1.4 - (0.1) (0.1) - -
Inter-company interest charges - (0.3) - 0.5 - (0.2) - -
Profit /(loss) after taxation after inter-company charges 14.4 (0.4) (0.2) (0.5) (0.2) 0.9 - 14.0
Segmental assets (Total assets excluding goodwill) 69.4 174.0 7.9 (2.4) 11.4 16.2 - 276.5
Segmental liabilities 28.2 57.0 2.9 30.3 0.7 4.6 - 123.7
Goodwill 21.0 - - - - - - 21.0
Net assets (excluding goodwill) 41.2 117.0 5.0 (32.7) 10.7 11.6 - 152.8
Capital expenditure 4.7 6.2 - - 0.2 0.3 - 11.4
Note 1: All gold sales were made in the Republic of South Africa and the
majority of revenue was generated from selling gold to South African financial
institutions through the group's Funding Company.
Note 2: Other (expenses)/income exclude inter-company management fees and
dividend received.
Note 3: The disposal of Pan African Resources Coal Holdings Proprietary
Limited and Uitkomst was completed on 30 June 2017.
Note 4: The disposal of Phoenix was completed on 7 November 2017.
Condensed GBP Segment Report for the six month period ended 31 December 2017
31 December 2017
Continuing operations Discontinued operations
Barberton Mines Evander Mines Corporate Funding Company Phoenix (Note 4) Reclassification Group
GBP million GBP million GBP million GBP million GBP million GBP million GBP million
Revenue
Gold sales (Note 1) 39.7 43.2 - - - - 82.9
Platinum sales - - - - 1.4 (1.4) -
Coal sales - - - - - - -
Realisation costs (0.2) (1.3) - - - - (1.5)
On - mine revenue 39.5 41.9 - - 1.4 (1.4) 81.4
Gold cost of production (32.0) (37.6) - - - - (69.6)
Platinum cost of production - - - - (1.6) 1.6 -
Coal cost of production - - - - - - -
Depreciation (2.2) (3.7) - - - - (5.9)
Mining Profit 5.3 0.6 - - (0.2) 0.2 5.9
Other (expenses)/income (Note 2) (0.4) 1.1 (1.5) - - - (0.8)
Profit on disposal of investment - - - - - - -
Loss on sale of asset held for sale - - - - (0.3) 0.3 -
Royalty costs (0.2) (0.1) - - - - (0.3)
Net income / (loss) before finance income and finance costs 4.7 1.6 (1.5) - (0.5) 0.5 4.8
Finance income 0.1 0.4 0.2 - - - 0.7
Finance costs - - - (0.8) - - (0.8)
Profit /(loss) before taxation 4.8 2.0 (1.3) (0.8) (0.5) 0.5 4.7
Taxation (0.5) (0.1) (0.4) - 0.1 (0.1) (1.0)
Profit /(loss) after taxation before inter-company charges 4.3 1.9 (1.7) (0.8) (0.4) 0.4 3.7
Profit/(loss) after taxation from discontinued operations - - - - - (0.4) (0.4)
Profit /(loss) after taxation before inter-company charges 4.3 1.9 (1.7) (0.8) (0.4) - 3.3
Inter-company transactions
Management fees (0.8) (0.2) 1.1 (0.1) - - -
Inter-company interest charges (0.2) (0.3) (0.2) 0.7 - - -
Profit /(loss) after taxation after inter-company charges 3.3 1.4 (0.8) (0.2) (0.4) - 3.3
Segmental assets (Total assets excluding goodwill) 75.5 230.4 10.3 5.2 - - 321.4
Segmental liabilities 27.8 52.8 2.7 46.6 - - 129.9
Goodwill 21.0 - - - - - 21.0
Net assets (excluding goodwill) 47.7 177.6 7.6 (41.4) - - 191.5
Capital expenditure 4.0 35.1 - - 0.3 - 39.1
31 December 2016
Continuing operations Discontinued operations
Barberton Mines Evander Mines Corporate Funding Company Phoenix Uitkomst (Note 3) Reclassification Group
GBP million GBP million GBP million GBP million GBP million GBP million GBP million GBP million
Revenue
Gold sales (Note 1) 48.8 41.3 - - - - - 90.1
Platinum sales - - - - 2.4 - (2.4) -
Coal sales - - - - - 12.6 (12.6) -
Realisation costs (0.3) (1.2) - - - - - (1.5)
On - mine revenue 48.5 40.1 - - 2.4 12.6 (15.0) 88.6
Gold cost of production (29.4) (35.8) - - - - - (65.2)
Platinum cost of production - - - - (2.3) - 2.3 -
Coal cost of production - - - - - (10.6) 10.6 -
Depreciation (2.5) (3.2) - - (0.4) (0.3) 0.7 (5.7)
Mining Profit 16.6 1.1 - - (0.3) 1.7 (1.4) 17.7
Other (expenses)/income (Note 2) 4.5 (0.5) (2.1) - 0.1 - (0.1) 1.9
Profit on disposal of investment - - 0.3 - - - - 0.3
Loss on sale of asset held for sale - - - - - - - -
Royalty costs (0.7) (0.2) - - - - - (0.9)
Net income / (loss) before finance income and finance costs 20.4 0.4 (1.8) - (0.2) 1.7 (1.5) 19.0
Finance income - - - 0.1 - - - 0.1
Finance costs - - - (1.1) - - - (1.1)
Profit /(loss) before taxation 20.4 0.4 (1.8) (1.0) (0.2) 1.7 (1.5) 18.0
Taxation (5.4) 0.1 0.2 - 0.1 (0.5) 0.4 (5.1)
Profit /(loss) after taxation before inter-company charges 15.0 0.5 (1.6) (1.0) (0.1) 1.2 (1.1) 12.9
Profit/(loss) after taxation from discontinued operations - - - - - - 1.1 1.1
Profit /(loss) after taxation before inter-company charges 15.0 0.5 (1.6) (1.0) (0.1) 1.2 - 14.0
Inter-company transactions
Management fees (0.6) (0.6) 1.4 - (0.1) (0.1) - -
Inter-company interest charges - (0.3) - 0.5 - (0.2) - -
Profit /(loss) after taxation after inter-company charges 14.4 (0.4) (0.2) (0.5) (0.2) 0.9 - 14.0
Segmental assets (Total assets excluding goodwill) 69.4 174.0 7.9 (2.4) 11.4 16.2 - 276.5
Segmental liabilities 28.2 57.0 2.9 30.3 0.7 4.6 - 123.7
Goodwill 21.0 - - - - - - 21.0
Net assets (excluding goodwill) 41.2 117.0 5.0 (32.7) 10.7 11.6 - 152.8
Capital expenditure 4.7 6.2 - - 0.2 0.3 - 11.4
Note 1: All gold sales were made in the Republic of South Africa and the
majority of revenue was generated from selling gold to South African financial
institutions through the group's Funding Company.
Note 2: Other (expenses)/income exclude inter-company management fees and
dividend received.
Note 3: The disposal of Pan African Resources Coal Holdings Proprietary
Limited and Uitkomst was completed on 30 June 2017.
Note 4: The disposal of Phoenix was completed on 7 November 2017.
Condensed ZAR Segment Report for the six month period ended 31 December 2017
31 December 2017
Continuing operations Discontinued operations
Barberton Mines Evander Mines Corporate Funding Company Phoenix (Note 4) Reclassification Group
ZAR million ZAR million ZAR million ZAR million ZAR million ZAR million ZAR million
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