Pan African Resources sees strong cashflows as gold price surges

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What it does

Pan African Resources plc (LON:PAF) is a mid-tier African-focused gold producer, dual-listed on the London AIM market and the Johannesburg Stock Exchange, and with a Level 1 ADR programme sponsored by the Bank of New York Mellon.  It owns and operates a portfolio of high-quality, high-margin South African operations with a production capacity of approximately 200,000 ounces of gold per annum.


How it is doing

Pan African boosted gold production 5.9% to 98,386 ounces in the six months to December 2020.

It leaves the company on track to deliver on its full-year production guidance of approximately 190,000 ounces of gold.

Net cash generated by operating activities increased by 178.2% to US$28.1mln, and the company was able to reduce net debt by 47.3%.

Profit after taxation amounted to US$40.8mln, and earnings per share increased to US$0.0211 cents.

The company said it continues to focus on ESG projects, including the 9,975MW solar photovoltaic plant at Evander Mines and the large-scale agriculture projects at Barberton Mines. These are on track for commissioning in the third quarter of calendar 2021.


What the boss says: Cobus Loots, chief executive 

“Barberton Mines deserves recognition for a robust operational performance, with gold production of 52,354oz for the six months ended 31 December 2020, demonstrating the excellent progress at this flagship operation in reserve development and infrastructure optimisation.”


Inflexion points 

  • Production hits its target of 190,000oz in 2020/21
  • Gold price remains high
  • Dividend rises as debt is paid down

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