Announcements 2015

In compliance with paragraph 3.63 of the JSE Limited Listings Requirements (“JSE listings requirements”), Northam hereby advises its shareholders of the following dealings by directors of the company, directors of major subsidiaries and the company secretary:

Johannesburg
19 November 2015

Sponsor and Debt Sponsor
One Capital

Heraeus to invest €20 million in expanding Northam’s smelting capacity

Johannesburg, 23 October 2015: Northam Platinum Limited (Northam) is pleased to announce that it has agreed terms to extend its co-operation agreement with Heraeus Deutschland GmbH &Co. KG (Heraeus) and Heraeus South Africa Proprietary Limited (HSA). The agreement will cement the strategic partnership between the companies and support Northam’s expansion plans.

In terms of the agreement Heraeus will contribute €20 million (approximately R300 million at the current exchange rate) to expand the capacity of Northam’s existing smelter, with the construction of a 20MW second furnace at the Zondereinde metallurgical complex. The total cost of the expansion is estimated at R750 million.

Northam chief executive Paul Dunne said today, “the addition of a second furnace at the Zondereinde division is a critical element of Northam’s strategic growth: it supports the expansion programme at Booysendal and the increased UG2 mining at Zondereinde and will immediately raise the group’s processing capacity to more than 1 million PGM ounces.  In addition, it reduces operational risk, while providing headroom for third party concentrate purchases and toll treatment arrangements.”

The agreement also provides for the renewal of the current offtake and toll refining agreements with Heraeus, and a represents a landmark initiative in which both parties will also support product development and optimisation.

Heraeus’ capital contribution will be fixed according to a progress schedule, and paid in tranches.  The furnace is planned to be commissioned by the end of the 2017 calendar year. In return Northam will renew its toll refining agreement with Heraeus and HSA for a period of 20 years at competitive terms.  Northam also undertakes to sell up to 40% of its production to Heraeus or HSA at market prices.

The various elements of the agreement underscore Northam’s plans for growth and expansion, underpinned by a conservative approach to capital expenditure, particularly in the current climate of metal price weakness. 

Dunne concluded that this investment by Heraeus is a clear sign of confidence in platinum group metals, their markets and in Northam. “This development is significant, not only in that it further cements our companies’ already long-standing business partnership, but is an expression of confidence in PGMs and their markets, Northam’s performance to date, and our expansion strategy.”

Note to editors:

Heraeus is a leading international family-owned technology group headquartered in Hanau, Germany. Heraeus’ interests range from components to coordinated material systems which are used in a wide variety of industries, including the steel, electronics, chemical, automotive and telecommunications industries. In the 2014 financial year, Heraeus generated product revenues of €3.4 bn and precious metal revenues of €12.2bn . With around 12,600 employees worldwide in more than 100 subsidiaries in 38 countries, Heraeus holds a leading position in its global markets.

Heraeus South Africa is a 100% subsidiary of Heraeus Precious Metals and operates from two premises in South Africa: a marketing and sales office in Boksburg, near Johannesburg, as well as a precious metal chemical compounds production and refinery site in Port Elizabeth.

Heraeus’ relationship with Northam Platinum has been in place for more than 25 years. Once material has been processed at Northam’s smelter and base metals removal plant , located on the Zondereinde lease area, the product is refined by Heraeus, both in Port Elizabeth and in Hanau, Germany. Northam’s in-house marketing department is responsible for marketing and sales of product both domestically and to the major global markets in Asia, Europe and North America.

Issued by

Russell & Associates
Johannesburg
Tel +27 (0)11 880 3924

Northam shareholders are referred to the SENS announcement dated 10 February 2015 wherein shareholders were advised that Northam had entered into a sale of assets agreement with Aquarius Platinum (South Africa) (Pty) Ltd to acquire the Everest Mining Assets and Everest Mining Right for a total cash purchase consideration of R450 million (excluding VAT), comprising R400 million for the Everest Mining Assets (Part A Sale) and R50 million for the Everest Mining Right (Part B Sale). Shareholders are also referred to the SENS announcement dated 23 April 2015, wherein shareholders were advised that the Part A Sale had become unconditional.

Northam is pleased to announce that the parties have obtained consent in terms of section 11 of the Mineral and Petroleum Resources Development Act, No. 28 of 2002 to transfer the Everest Mining Right to Northam. The conditions precedent to the Part B Sale have therefore been fulfilled and the Part B Sale has become unconditional. The Part B Sale will be implemented on 8 October 2015.

Paul Dunne, CEO of Northam, says, “Northam is pleased to have successfully implemented this key strategic acquisition, which provides Northam with significant long-term organic growth optionality. With Everest now being part of the broader Booysendal mining footprint, Northam is well positioned to assess and prioritise its internal growth opportunities.”

Johannesburg
1 October 2015

Corporate Advisor, Sponsor and Debt Sponsor: One Capital
Attorneys: Cliffe

The annual general meeting of Northam shareholders will be held at Glen Hove Conferencing, 52 Glenhove Road, Melrose Estate, Johannesburg, South Africa on Wednesday, 11 November 2015 at 10:00 to transact the business as stated in the notice of annual general meeting, forming part of the abridged annual report 2015 (“notice and abridged report 2015”).

No change statement

Shareholders are advised that the summarised audited financial statements for the 12 months ended 30 June 2015 as contained in the notice and abridged report 2015, will be distributed electronically to shareholders today, 30 September 2015, whilst the physical mailing process of the notice and abridged report 2015 is expected to be completed by no later than Friday, 2 October 2015. The audited annual financial statements 2015 contain no material modifications to the reviewed preliminary results, which were published on SENS on 20 August 2015.

The annual integrated report 2015 containing the full audited annual financial statements, and the notice and abridged report 2015, are available at www.northam.co.za or can be obtained from the company’s registered office on request.

The salient dates of the annual general meeting are as follows:

Johannesburg
30 September 2015

Sponsor and Debt Sponsor
One Capital

Northam wishes to advise shareholders that the credit rating agency, Global Credit Rating Co. (“GCR”), has upgraded Northam’s short term credit rating from A2(za) to A1-(za) and reaffirmed the Company’s long term rating of BBB+(ZA) with the outlook accorded as Stable.

Northam’s upgrade in its short term credit rating was obtained despite the industry outlook remaining negative on account of, inter alia, depressed platinum group metal (PGM) prices and cost inflation, illustrating the benefits of the Group’s liquid balance sheet and strong shareholder support.

GCR has published a detailed credit rating report (available from GCR at http://globalratings.net detailing the key criteria which form the basis for its rating, these include:

• The impact of Northam’s fully funded R6.6 billion black economic empowerment transaction, which raised Northam’s empowerment levels to 35.4%, on a secured basis for 10 years, and incorporated a cash injection of R4.6 billion, notably enhancing Northam’s liquidity and flexibility.
• Increased production supported the uplift in PGM sales, which saw the Group’s revenue increase to over R6 billion for the first time in the 2015 financial year.
• Higher Booysendal Mine output and general cost rigour underpinned a recovery in the Group’s operating profit margin.
• The Booysendal Mine increasing the Group’s operational stability and reducing the concentration of risk. The mine is set to reach steady production in the second half of calendar 2015.
• A reduction in capital expenditure during the 2015 financial year both deliberate and occasioned by the virtual completion of the Booysendal North, Phase 1.
• Northam’s redemption of the R1.4 billion in three-year domestic medium term notes thereby reducing the Group’s debt to negligible levels.
• The three-year wage agreement recently concluded at Northam’s Zondereinde mine with the National Union of Mineworkers. 

Johannesburg
11 September 2015

Issued by

Russell & Associates
Johannesburg
Tel +27 (0)11 880 3924

Marion Brower: +27 (0) 71 493 0387