Northam Platinum Holdings Limited · JSE:NPH
Northam Platinum — H1 2019 Earnings Presentation
32 slides from Northam Platinum's earnings presentation, February 2019
Slide 1: Reviewed Interim Results for the Six Months Ended 31 December 2018
NORTHAM PLATIN UM LiImMttTeEooD 2019 REVIEWED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2018 smart platinum mining
Slide 2: Disclaimer
DISCLAIMER Certain statements in this presentation (other than the statements of historical fact) may contain forward-looking statements regarding Northam’s operations, economic performance or financial condition, including, without limitation, those concerning the economic outlook for the platinum
Slide 3: Key features, operational, financial, projects review, business outlook
Key features Operational review Financial review Projects review Business outlook Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 3
Slide 4: Key features
Normalised headline earnings of 108.5 cents per share, up 192.5% Record operating Solid operating profit for an performance, with interim period unit cash cost per of R1.0 billion Pt/oz up 5.5% Commendable safety performance Execution of growth strategy Net debt of well advanced, with R2.9 billion R
Slide 5: PGM Prices
PGM PRICES FROM 1 JANUARY 2015 (USD/oz) 3 200 2 700 2 200 Platinum Rhodium USD/oz 1 700 Palladium 1 200 700 200 Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 5
Slide 6: Operational review
Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 6
Slide 7: Safety
SAFETY ZONDEREINDE LTIIR per 200 000 hours worked H1 2019 1.27 H1 2018 1.31 1 fatal accident BOOYSENDAL LTIIR per 200 000 hours worked H1 2019 0.10 H1 2018 0.31 Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 7
Slide 8: Operational Statistics – Group
OPERATIONAL STATISTICS – GROUP H1 F2019 H1 F2018 Variance % Total tonnage milled tonnes 2 371 060 2 296 466 3.2 Equivalent refined metal – own production oz 4E 256 461 246 473 4.1 Equivalent refined metal – purchased oz 4E 7 962 29 770 (73.3) Total refined metal produced oz 4E 299 323 212 133 41.1 T
Slide 9: Operational Statistics – Zondereinde
OPERATIONAL STATISTICS – ZONDEREINDE H1 F2019 H1 F2018 Variance % Merensky milled tonnes 400 686 378 930 5.7 Merensky head grade g/t 4E 6.02 6.06 (0.7) UG2 milled tonnes 606 450 589 921 2.8 UG2 head grade g/t 4E 4.28 4.15 3.1 Total milled tonnes 1 007 136 968 851 4.0 Average combined head grade g/t
Slide 10: Zondereinde – Western Extension
ZONDEREINDE – WESTERN EXTENSION Ore reserve development on 3 to 12 levels continues 3 Reef raises on 3 level and 5 level on the 11 line have holed 4 Remaining 11 line reef raises to hole by financial year end 5 6 Stoping is expected to start by April 2019 7 Ground conditions are good 8 Predominant r
Slide 11: Operational Statistics – Booysendal
OPERATIONAL STATISTICS – BOOYSENDAL H1 F2019 H1 F2018 Variance % Merensky milled tonnes 190 079 137 400 38.3 Merensky head grade g/t 4E 2.41 1.99 21.1 UG2 milled tonnes 1 173 845 1 190 215 (1.4) UG2 head grade g/t 4E 2.80 2.73 2.6 Total milled tonnes 1 363 924 1 327 615 2.7 Average combined head gra
Slide 12: Resource Statement
RESOURCE STATEMENT 31 December 2018 30 June 2018 Operation Moz 4E Moz 4E Booysendal 104.9 105.1 Zondereinde 105.0 105.2 Eland 19.3 19.3 Dwaalkop 8.9 8.9 Total group resource 238.1 238.5 Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 12
Slide 13: Inventory Breakdown (4E)
INVENTORY BREAKDOWN (4E) 42 411oz PMR inventory 40 754oz 13 554oz BMR inventory 9 179oz 107 230oz Smelter inventory 83 207oz 14 664oz Concentrate (pre-smelter) 74 922oz 17 276oz Concentrate in progress 24 073oz 35 471oz Ore stockpiles 28 427oz R000 0 200 000 400 000 600 000 800 000 1 000 000 1 200 0
Slide 14: Financial review
Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 14
Slide 15: Financial Highlights
FINANCIAL HIGHLIGHTS Revenue of Record operating profit EBITDA of R5.0 billion, of R1.0 billion and an R1.1 billion, an increase of operating profit margin an increase 48.6% of 20.7%, up 105.0% of 111.1% Normalised headline earnings Capital expenditure of R553.3 million, an increase of of R1.5 billi
Slide 16: Normalised Headline Earnings
NORMALISED HEADLINE EARNINGS H1 F2019 H1 F2018 Variance R000 R000 % Headline loss per the financial results (66 644) (279 834) 76.2 Add back: Amortisation of liquidity fees paid on preference shares 8 195 8 195 - Preference share dividends 611 761 460 762 32.8 Normalised headline earnings 553 312 18
Slide 17: Increase in Sales Revenue
INCREASE IN SALES REVENUE F2018 sales revenue R million 7 000 Up by 48.6% 6 000 244.3 4 982.8 5 000 176.1 1 209.1 PGM sales volumes 4 000 40.5% higher 3 353.3 3 000 4.2% higher average USD 2 000 5.7% basket price 1 000 weaker average ZAR/USD 0 exchange rate H1 2018 Volume variance Price variance Exc
Slide 18: Increase in Sales Volume
INCREASE IN SALES VOLUME H1 F2019 H1 F2018 Variance % Total refined metal produced 4E oz 4E oz 299 323 212 133 41.1 Total metal sold 4E oz 4E oz 294 823 209 861 40.5 Sales revenue R000 4 982 761 3 353 270 48.6 Total revenue per Pt oz sold R/Pt oz 27 524 26 516 3.8 Chrome tonnes sold tonnes 368 288 3
Slide 19: Record Operating Profit
RECORD OPERATING PROFIT H1 F2019 H1 F2018 Variance R000 R000 % Sales revenue 4 982 761 3 353 270 48.6 Cost of sales (3 951 981) (3 014 497) (31.1) Operating costs (3 543 074) (3 129 727) (13.2) Concentrates purchased (94 062) (430 052) 78.1 Refining and other charges (71 902) (56 563) (27.1) Depreci
Slide 20: Movement in Cost of Sales
MOVEMENT IN COST OF SALES Operating costs up owing to Cost of sales increased production, higher smelting volumes and start R million 811.1 up of Booysendal South 4 000 3 952.0 concentrator 3 800 Concentrates purchase 3 600 413.3 -336.0 significantly lower than 3 400 prior period 33.6 3 200 15.3 3 0
Slide 21: Statement of Profit or Loss
STATEMENT OF PROFIT OR LOSS H1 F2019 H1 F2018 Variance R000 R000 % Sales revenue 4 982 761 3 353 270 48.6 Cost of sales (3 951 981) (3 014 497) (31.1) Gross profit 1 030 780 338 773 204.3 Share of earnings from associates and joint ventures 6 174 6 428 (4.0) Investment income 23 992 28 860 (16.9) Fi
Slide 22: Cash Flow
CASH FLOW Operating cash flow R1 152.5 million H1 F2019 cash flow R million 4 000 Release of working capital of 3 500 R145.3 million 3 000 2 500 R 499.2 -1 450.5 Investing cash flow at 2 000 R1 450.5 million 145.3 1 152.5 1 500 1 000 639.7 Cash flow from financing activities 500 293.2 R499.2 million
Slide 23: Current and Forecast Net Debt
CURRENT AND FORECAST NET DEBT 5.0 4.5 4.0 3.5 3.0 R'billion 2.5 2.0 1.5 1.0 0.5 - H1 F2019 E F2019 Available funding/facilities Net debt Headroom available Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 23
Slide 24: Capital Expenditure
CAPITAL EXPENDITURE H1 F2019 H1 F2018 Variance R000 R000 % Expansionary capex Zondereinde 360 762 1 348 405 (73.2) Contribution received for capital assets - (303 106) (100.0) Booysendal North 111 901 191 981 (41.7) Booysendal South 877 282 940 010 (6.7) Eland 132 236 190 759 (30.7) Other - 64 667 (
Slide 25: Projects review
Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 25
Slide 26: Booysendal South
BOOYSENDAL SOUTH Ropecon commissioned Infrastructure at Central boxcut progressing as planned Underground development on track Concentrator – PGM circuit commissioned Re-established access to BS4 for future tailings deposition Northam Platinum Limited Reviewed interim results for the six months ende
Slide 27: Slide 27
Slide 28: Booysendal South
BOOYSENDAL SOUTH Ropecon commissioned Infrastructure at Central boxcut progressing as planned Underground development on track Concentrator – PGM circuit commissioned Re-established access to BS4 for future tailings deposition Northam Platinum Limited Reviewed interim results for the six months ende
Slide 29: Other Projects
OTHER PROJECTS Eland • Concentrator recommissioning on track • tailings re-treatment to start in March 2019 • Trial mining to start by financial year end • Evaluating other opportunities including treatment of third party ore Recycling • Sourcing and processing salvaged catalytic convertors on a tri
Slide 30: Business Outlook
Inventory destocking Project execution Operations: Labour relations maintain Booysendal competitive cost wage position negotiations Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 30
Slide 31: Questions?
QUESTIONS? Northam Platinum Limited Reviewed interim results for the six months ended 31 December 2018 31
Slide 32: Contact details
Contact details Building 4, 1st Floor Maxwell Office Park Magwa Crescent West Waterfall City Shareholder information Jukskei View 2090 Name Northam Platinum Limited South Africa Share code NHM Leon van Schalkwyk ISIN code ZAE 000030912 Tel: +27 11 759 6000 Fax: +27 11 325 4795 JSE sector Platinum Em