Pan African achieves record first-half gold production

Pan African Resources reported a 9.9% improvement in group gold production in its interim results on Wednesday, to a record half-year of 108,085 ounces.

The AIM-traded firm said its all-in sustaining costs for the six months ended 31 December came in at $1,173 per ounce, which was an improvement of 6.3% compared to the $1,252it recorded per ounce for the same period in 2020.

It increased its full-year production guidance to approximately 200,000 ounces as a result of the bumper first half.

On the financial front, Pan African said the net cash generated by its operating activities increased 54.4% to $43.4m, while its profit after tax and headline earnings rose to $46.1m from $40.8m.

Earnings per share and headline earnings per share were ahead 13.3% at 2.39 US cents, while the firm made a record net rand dividend payment in December, converted to presentation currency of $21.6m.

The company said its net debt narrowed by 56.7% by the end of the period.

Operationally, Pan African said the underground life-of-mine for Evander Mines was extended to 13 years, with increased expected gold production and development capital internally funded.

The evaluation of the Mintails tailings retreatment opportunity agreement was extended, while the firm’s environmental, social and governance (ESG) initiatives, including renewable energy and large-scale agriculture projects, were said to be “on track”.

“Pan African has again delivered an excellent operational performance, achieving record gold production in excess of 108,000 ounces for the current reporting period, and exceeding our previous guidance,” said chief executive officer Cobus Loots.

“The group is on track to produce approximately 200,000 ounces of gold for the financial year ending 30 June, in line with our increased production guidance.

“We are committed to continuing to create value for our stakeholders by positioning Pan African as a sustainable, safe, high-margin and long-life gold producer with an attractive pipeline of growth projects.”

At 1001 GMT, shares in Pan African Resources were up 3.88% at 20.01p.