REG-Pan African Resources Plc: Operational Update, Record Half-Year Gold Production, Substantial Decrease in Group Gearing and Share Buyback Programme

Pan African ResourcesAnnouncement

11/06/2025 08:45

Pan African Resources PLC    Pan African Resources Funding Company

(Incorporated and registered in England and Wales  Limited

under Companies Act 1985 with registered   Incorporated in the Republic of
South Africa

number 3937466 on 25 February 2000)   with limited liability

Share code on AIM: PAF     Registration number: 2012/021237/06

Share code on JSE: PAN     Alpha code: PARI

ISIN: GB0004300496

ADR code: PAFRY

(“Pan African” or “the Company” or “the Group”)

 

OPERATIONAL UPDATE, RECORD HALF-YEAR GOLD PRODUCTION, SUBSTANTIAL DECREASE IN
GROUP GEARING AND SHARE BUYBACK PROGRAMME

Pan African is pleased to provide its shareholders and noteholders with an
operational update for the financial year ending 30 June 2025 (FY25).

 

KEY FEATURES
* Regrettably, the Group suffered a fatal accident on 6 June 2025 at
Barberton’s Sheba Mine. The Group will continue its focus on various safety
performance initiatives in order to improve safety statistics and strive for
zero harm
* Record half year gold production in FY25H2 and a substantial increase when
compared to FY25H1. Production for FY25H2 estimated at approximately
112,000oz, representing an increase of approximately 32% when compared to
FY25H1 (84,705oz). 
* Substantial reduction in Group gearing with net debt of approximately US$155
million expected as at 30 June 2025, a decrease of US$72 million or 32%
compared to 
	31 December 2024 (net debt of US$228.5 million) – the Group is expected to
be fully degeared during FY26 at prevailing gold prices
* Board approved share buyback programme to purchase up to ZAR200 million
(approximately US$11.1 million) of ordinary shares in the market
* Total full year production for FY25 expected to be approximately 197,000oz
(FY24: 186,039oz), an increase in production of approximately 6% compared to
the prior financial year. Despite a significant increase in production in H2,
full year production will therefore fall marginally below FY25 production
guidance range of 205,000oz to 215,000oz as a result of:	* Slower than
expected ramp up of the Evander underground subvertical shaft project, which
is now fully commissioned and operational
* Delays encountered with the commissioning of the filter presses associated
with the dry stack landforms (tailings section) of the Tennant Mines plant,
resulting in a slower ramp up in production  
	
* Tennant Mines gold processing plant commissioned on budget and on schedule
with steady state production of approximately 50,000oz per annum now expected
during the first quarter of FY26
* Group all-in sustaining costs (AISC) for FY25H2 estimated between US$1,525
and US$1,550 (previous guidance of US$ 1,450/oz to US$1,500/oz) at an average
exchange rate of US$/ZAR:18.50, primarily as a result of lower than expected
production following the slower than anticipated ramp up in production at
Evander underground and realised losses on the zero cost collar hedges of
approximately US$25/oz
* Group AISC for FY25 is expected to be between US$1,550/oz to US$1,575/oz at
an average exchange rate of US$/ZAR:18.50 (previous guidance of US$1,450/oz to
US$1,500/oz).  This AISC includes the impact of zero cost collar detailed
above
* Production guidance for FY26 of between 275,000oz and 292,000oz, an increase
of approximately 40% compared to expected FY25 production at an AISC of
between US$1,475 and $1,525
 

GROUP GOLD PRODUCTION FOR FY25

The notable increase in the Group’s production in FY25H2 is as a result of
the following:
* The successful ramp up at the Mogale Tailings Retreatment (MTR) operation
* Steady production at Elikhulu and Barberton Tailings Retreatment Plant
(BTRP)
* Improved grades and tonnages following the commissioning of the Evander
subvertical shaft
* Much improved production from all of the Barberton underground operations.
 

Production for FY25 is estimated at approximatley 197,000oz (FY24: 186,039oz),
an increase of approximately 6% from the prior financial year.

SURFACE OPERATIONS
* Elikhulu production is estimated at approximately 26,000oz for FY25H2, and
is on track for achieving production of more than 52,000oz for FY25 (FY24:
54,812 oz)
* The MTR operation reached steady state production during December 2024	*
Production of approximately 21,000oz for FY25H2, with estimated production of
approximately 30,000oz for FY25
* The expansion of the plant from 800Ktpm to 1Mtpm, with the addition of two
carbon-in-leach (CIL) tanks together with the installation of reactors to
further improve recoveries, at a total expansion cost of US$6.5 million, is in
progress. This will result in an increase in production from 50,000oz to
approximately 60,000oz per annum, with the expansion project expected to be
completed during FY26
* MTR has successfully concluded a three-year wage agreement with its
employees at an average wage increase of 5% per annum over the three-year
period, providing stability to the operation
* Soweto Cluster Feasibility Study (FS) is on track for completion by
September 2025, with the study focusing on the option of constructing a new
processing facility which would be a stand-alone operation also producing
approximately 50,000oz per annum 
	
* BTRP is expected to achieve production of approximately 8,000oz in FY25H2,
with full year production of approximately 15,500oz (FY24:  18,888). As
previously reported, the remaining life-of-mine (LOM) of the BTRP has now been
increased to six years from current surface sources
* Construction work at Tennant Mines’ Nobles operation, at a cost of US$36
million, was completed with successful hot commissioning during April 2025. An
inaugural gold pour from this operation was achieved in May 2025. Production
ramp up was slower than expected as a result of a delay in the commissioning
of the filter presses associated with the dry stack landforms (tailings
section) of the plant. Steady-state throughput at an annualised rate of circa
50,000oz is expected to be achieved during the first quarter of FY26.  
 

UNDERGROUND OPERATIONS
* The sub-vertical hoisting shaft commissioning at the Evander underground
operation was completed during January 2025, with ramp-up to its expected
hoisting capacity achieved during April 2025, enabling full production from
24-25 levels and production of approximately 27,000oz expected for FY25	*
Average production for the last two months of FY25 of approximately 3,850oz
per month, confirming production capacity of ~50,000oz per annum going forward
	
* Barberton Mines 	* The restructuring of the underground operations was
successfully completed in May 2025, with an approximate 20% reduction in the
overall Barberton workforce
* Excellent improvement in performance of all underground operations during
FY25H2, as follows:		* Fairview Mine expected production of approximately
22,000oz (FY25H1: 19,096oz), an increase of 15% 
* Consort Mine production is expected to increase by 70% to approximately
5,500oz for FY25H2 (FY25H1: 3,242oz), with this operation now positively
contributing to cash flow 
* Sheba Mine production is expected to increase by 20% to approximately
10,600oz (FY25H1: 8,805oz) as a result of access to higher grade mining areas
and initiatives to improve productivity. 
		
* Production of approximately 38,000oz is expected for the Barberton Mines
underground operations in FY25H2 (FY25H1: 31,142oz), with full year production
of approximately 69,000oz (FY24: 71,470oz).
 

FINANCIAL

 
* The Group is expected to be fully degeared (in terms of net debt) in the
next 12 months at prevailing gold prices
* The Group will be unhedged from 1 July 2025, following the expiry of the
last zero cost collars at the end of June 2025, and the synthetic forward that
matured at the end of February 2025, allowing the Group to fully benefit from
prevailing gold prices. Realised losses on these zero cost collars is
estimated to have a negative impact on AISC of approximately US$25/oz for
FY25H2
* The Group expects AISC for FY25H2 of between US$1,525/oz to US$1,550/oz at
an exchange rate of ZAR18.50/US$. This represents a significant improvement
from the US$1,675/oz for FY25H1, with full year AISC expected to be between
US$1,550/oz and US$1,575/oz.
* AISC guidance for FY26 is between US$1,475 and $1,525, with the following
contributing positively to the cost outlook for FY26:	* Increase in the
contribution to Group production from lower cost surface operations, with a
full year of production from MTR and Tennant Mines
* Increased production from Evander underground operations
* Reduction in the labour cost for the Barberton underground operations,
following the successful conclusion of the operation’s restructuring
programme
* Savings arising from the extensive use of renewable energy projects
* Ongoing efforts to contain costs and reinforcing a culture of cost
consciousness.
 

FY26 PRODUCTION GUIDANCE

Group production for FY26 is expected to increase substantially, principally
as a result of steady-state production at the MTR operation, increased
production from Evander underground (following substantial investments in
infrastructure and underground development over the last years), as well as
the production contribution from Tennant Mines, with production ramp up
expected to be completed in the first quarter of FY26.

Group production for FY26 is expected to be between 275,000oz and 292,000oz as
outlined below:

 Operation                    Production Range (oz)  
 Elikhulu                     49,000-51,000          
 BTRP                         13,000-15,000          
 MTR                          52,000-54,000          
 Tennant Mines                46,000-50,000          
 Evander underground          46,000-50,000          
 Barberton Mines underground  69,000-72,000          
 Total                        275,000-292,000        

 

 

SHARE BUYBACK PROGRAMME

Pan African is pleased to announce that the board of directors (Board) has
approved a share buyback programme to purchase up to ZAR200 million
(approximately US$11.1 million) of ordinary shares of £0.01 each in the
Company (Shares), commencing on 17 June 2025 (the Programme). The Company’s
profits available for distribution exceed the maximum amount proposed to be
paid by the Company in implementing the Programme.

The Board believes that at the current Share price, the Company’s Shares
offer significant value, given the quality and profitability of the Group’s
existing operations and growth projects. The Board has therefore taken the
decision to implement the Programme as part of the Company's broader strategy
to deliver value to shareholders.

Purchases pursuant to the Programme will be made under the authority granted
by shareholders at the Company’s 2024 annual general meeting (the Repurchase
Authority) which  enables the Company to make market acquisitions of Shares
in accordance with the Companies Act 2006. The Programme will be conducted in
accordance with the Market Abuse Regulation 596/2014 and the Commission
Delegated Regulation (EU) 2016/1052 (each as in force in the UK by virtue of
the European Union (Withdrawal) Act 2018 and as amended by the Market Abuse
Regulation (Amendment) (EU Exit) Regulations 2019) (MAR Buy-Back Regulation).
The Company has been advised that in order to comply with the UK Companies
Act, it is likely that the Company will be required have to implement the
Programme exclusively by acquiring Shares on the AIM Market of the London
Stock Exchange (LSE), as the JSE is not a “Recognised Investment Exchange”
of the Financial Conduct Authority in the UK. The Company will be seeking a
dispensation from the JSE to implement the Programme exclusively on the AIM
Market of the LSE before commencement of the Programme. However, in any event,
all shareholders registered on both the UK register and the South African
register will benefit from the implementation of any purchases pursuant to the
Programme, as a result in the reduction in share capital for the Company as a
whole.

The Repurchase Authority permits the purchase of a maximum of 144,486,033 
Shares at a maximum price (excluding expenses) of 105 per cent of (i) the
average closing price of a Share as derived from the AIM Appendix to the
London Stock Exchange Daily Official List for the five business days
immediately preceding the date of purchase.

Purchases pursuant to the Programme will take place on the London Stock
Exchange (LSE) as permitted by the Companies Act 2006 and in compliance with
the MAR Buy Back Regulation. Pan African has entered into agreements with Peel
Hunt LLP ("Peel Hunt") to carry out on-market purchases of its Shares. The
agreement grants Peel Hunt the authority to enact purchases and make trading
decisions concerning the timing of the purchases under the Programme
independently of and uninfluenced by the Company during any closed period to
which the Company is subject and/or if the Company comes into possession of
inside information.

Purchases pursuant to the Programme will be carried out in compliance with the
relevant conditions for trading, restrictions regarding time and volume,
disclosure and reporting obligations, and price conditions. The Shares will be
repurchased at a price (excluding expenses) that does not exceed the last
independent trade or the highest current independent bid on the relevant
trading platform. The Company intends to cancel those Shares purchased.

Details of any purchases made under the Programme will be provided via SENS
and RNS announcements and published on the Company's website.

 

Cobus Loots, Pan African’s CEO commented:

“We are saddened by the loss of a colleague following a fatal accident in a
Sheba underground workshop last week, with an auto electrician succumbing to
injuries sustained whilst on duty.  Our thoughts and prayers are with the
family and friends of the deceased, as we continue to work towards our goal of
zero harm.

The commissioning during May 2025 of the processing plant at Tennant Mines in
Australia is a significant achievement for the Group and maintains our track
record of delivering new mining projects on time and within budget. We have
also now demonstrated our ability to commission large scale projects outside
of South Africa. In addition to a notable immediate increase in Pan
African’s production capacity, our investment in Tennant also provides for
exciting growth in a Tier-1 mining jurisdiction, with some 1,700 square
kilometres of prospective exploration ground, and our newly established
processing plant at Tennant Mines being the only such facility in the
region. 

The performance of our surface operations at Elikhulu, MTR and BTRP remained
consistent and largely unaffected by the excessive rainfall experienced
throughout South Africa early in this calendar year, with these world class
assets on track to achieve full-year production guidance.

Additionally, steady progress has been made on our South African underground
operations, with improved operational performances achieved at all our mines
in the second half of the financial year. The restructuring of the Barberton
operations has already yielded positive results and productivity improvements,
evidenced by increased gold production. Evander’s underground is also now
positioned to deliver a notable production increase in the year ahead,
following a period of large-scale investment into this long-life asset.

I believe the Group has never been better positioned to take advantage of
record gold prices, with record second half gold production being testament to
that achievement. Increased cashflow generation and de-gearing is allowing our
business to continue to invest and grow, whilst also increasing cash returns
to shareholders.  The share buy back programme approved by our board
demonstrates our confidence in the Group and its prospects.        

We look forward to reporting our final results for the year ended June 2025 on
10 September 2025, where additional details on progress with our growth
projects and sustainability initiatives will be presented.”

The information contained in this announcement is the responsibility of the
Board and has not been reviewed or reported on by the Group’s external
auditors.

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018. Upon the publication of this
announcement via Regulatory Information Service (RIS), this inside information
is now considered to be in the public domain.

Rosebank

11 June 2025

 

For further information on Pan African Resources, please visit the Company’s
website at

www.panafricanresources.com

 

 Corporate information                                                                                                                                                                                                                                                                                              
 Corporate Office The Firs Building 2nd Floor, Office 204 Corner Cradock and Biermann Avenues Rosebank, Johannesburg South Africa Office: + 27 (0)11 243 2900 info@paf.co.za  Registered Office 107 Cheapside, 2 nd Floor London, EC2V 6DN United Kingdom Office: + 44 (0)20 3869 0706  jane.kirton@corpserv.co.uk  
 Chief Executive Officer  Cobus Loots  Office: + 27 (0)11 243 2900                                                                                                            Financial Director and debt officer Marileen Kok Office: + 27 (0)11 243 2900                                                          
 Head: Investor Relations Hethen Hira                                                                                                                                         Website: www.panafricanresources.com                                                                                                  
  Tel: + 27 (0)11 243 2900                                                                                                                                                                                                                                                                                          
  E-mail: hhira@paf.co.za                                                                                                                                                                                                                                                                                           
 Company Secretary Jane Kirton St James's Corporate Services Limited Office: + 44 (0)20 3869 0706                                                                             Nominated Adviser and Joint Broker Ross Allister/Georgia Langoulant Peel Hunt LLP Office: +44 (0)20 7418 8900                         
 JSE Sponsor & JSE Debt Sponsor Ciska Kloppers Questco Corporate Advisory Proprietary Limited Office: + 27 (0) 63 482 3802                                                    Joint Broker Thomas Rider/Nick Macann BMO Capital Markets Limited Office: +44 (0)20 7236 1010                                         
                                                                                                                                                                              Joint Broker Matthew Armitt/Jennifer Lee Joh. Berenberg, Gossler & Co KG (Berenberg) Office: +44 (0)20 3207 7800                      

 



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