Announcements 2022

Northam Holdings shareholders (“shareholders”) are referred to the annual general meeting of shareholders (“AGM”) held today, 25 October 2022, as well as the announcement pertaining to the voting results of the resolutions presented at the AGM (“announcement”) published on SENS on the same date.

As noted in the announcement, more than 25% of the votes cast by shareholders present or represented by proxy at the AGM on ordinary resolutions 4.1 and 4.2 were exercised against the non-binding endorsement of the group’s remuneration policy and remuneration implementation report (“non-binding advisory resolutions”). Therefore, in accordance with the JSE Limited Listings Requirements and the recommendations of the King IV Report on Corporate Governance for South Africa, 2016, the company has invited dissenting shareholders (being shareholders who voted against any of the non-binding advisory resolutions) to send their comments / concerns / questions / recommendations regarding the group’s remuneration policy and/or remuneration implementation report, in writing, to Ms PB Beale, the company secretary of Northam, at trish.beale@norplats.co.za, to be received by no later than close of business on Thursday, 15 December 2022.

The company's remuneration committee endeavours to ensure that remuneration across the group is aligned with the group’s strategy and creates sustainable value for all stakeholders. We believe that open, transparent and meaningful engagement with shareholders is important to continually mature the remuneration policies and practices of the group. We therefore look forward to engaging with shareholders.

Johannesburg
25 October 2022

Corporate Advisor and Sponsor to Northam Holdings
One Capital

Attorneys to Northam Holdings and Northam Platinum
Webber Wentzel

Corporate Advisor and Debt Sponsor to Northam Platinum
One Capital

The JSE Limited (“JSE”) has granted approval for the listing of NHM023 Senior Unsecured Floating Rate Notes (“Notes”) under series NHM023 issued under the Northam Platinum Limited ZAR15 000 000 000 Domestic Medium Term Note Programme (“Programme”), dated 29 October 2020, as amended and supplemented from time to time (“Programme Memorandum”), as guaranteed by Booysendal Platinum Proprietary Limited, with effect from 21 October 2022.

Any capitalised terms not defined in this announcement shall have the meanings ascribed thereto in the section of the Programme Memorandum headed “Terms and Conditions of the Notes”.

The details pertaining to the issue of NHM023 are as follows:

The Notes will be dematerialised in the Central Securities Depository (CSD) and settlement will take place electronically in terms of the JSE rules.

Johannesburg
20 October 2022

Sole Arranger, Dealer and Debt Sponsor to Northam in respect of the Programme
One Capital

Attorneys to Northam, the Arranger and the Dealer in respect of the Programme
Bowman Gilfillan Inc.

Northam bondholders are advised of the following interest payment due on Tuesday, 13 September 2022:

Johannesburg
8 September 2022

Debt Sponsor
One Capital

Key financial features

• Revenue of R34.1 billion.
• Operating profit of R14.9 billion.
• EBITDA of R16.5 billion (EBITDA margin of 48.3%).
• Normalised headline earnings of R10.2 billion, equating to R25.74 per share.
• Profit after tax of R9.8 billion.
• Earnings per share of R26.15 and headline earnings per share of R26.11.
• Net debt of R16.0 billion (Net Debt to EBITDA of 0.97).

Production and unit cash costs

Notwithstanding the array of challenges faced during the year under review, our operations collectively achieved a steady increase in production and our growth projects remain on track.

A key feature during the year under review has been the difficult operational environments at the Zondereinde and Booysendal mines. During the first half of the financial year, Zondereinde tragically suffered two mining related fatalities, together with increased medical absences relating to the COVID-19 pandemic. Booysendal was affected by regional community unrest, which impacted the entire eastern Bushveld region, throughout the financial year. This resulted in lost production shifts. Booysendal was also affected by the intersection of a lower grade reef package in the upper southern portion of the North UG2 mine, which led to a decrease in concentrator feed grade. These challenges and external events negatively impacted the group’s metal production and unit cash costs during the financial year.

Despite the aforementioned challenges, the group’s equivalent refined metal from own operations increased to 716 488 oz 4E (F2021: 690 867 oz 4E). Zondereinde recorded improved production during the second half of the financial year, whilst production growth from Booysendal was lower than forecast as a result of lower grade mined at Booysendal North.

In respect of our current expansionary projects, development of the Western extension at Zondereinde has progressed well; Booysendal has made good progress on South mine whilst recording 7 million fatality free shifts and remaining fatality free since inception; and Eland continues its ramp-up, with the addition of the recently acquired Maroelabult section adding considerable synergistic benefits.

Group unit cash costs per equivalent refined platinum ounce increased by 18.9% to R34 069/Pt oz (F2021: R28 662/Pt oz) on the back of cost increases at all of the operations. Cash costs per equivalent refined platinum ounce increased by 14.8% at Zondereinde to R34 828/Pt oz (F2021: R30 350/Pt oz), 21.9% at Booysendal to R25 321/Pt oz (F2021: R20 780/Pt oz), and 29.5% at Eland to R55 594/Pt oz (F2021: R42 928/Pt oz). These increases were primarily driven by (i) above-inflationary increases in chemicals, steel components, emulsion explosives and fuel, (ii) an increase in the number of employees in service as the group continues to grow the labour complement to enable the planned expanded production profile together with the negotiated wage increase for our employees, and (iii) lower concentrator feed grades from the Booysendal North UG2 mine.

Capital expenditure

Capital expenditure increased to R4.6 billion (F2021: R3.3 billion). This is in line with our capital schedule and is the combined result of increased expansionary capital of R3.1 billion (F2021: R1.8 billion), together with a marginal decrease in sustaining capital expenditure to R1.4 billion (F2021: R1.5 billion).

Expansionary capital expenditure increased as a result of significant development on the Western extension project at Zondereinde, together with the ongoing ramp-up at Eland. Sustaining capital expenditure at Booysendal increased due to a number of extensions to strike belts and the first significant fleet replacements, whilst sustaining capital requirements at our metallurgical operations decreased following the commissioning of the rebuilt smelter furnace 1 at Zondereinde.

Financial highlights

Returning meaningful value to our shareholders

There are a number of ways in which Northam can return value to its shareholders, including cash dividends, share buy-backs and, previously, the purchase of Zambezi Platinum (RF) Proprietary Limited (previously Zambezi Platinum (RF) Limited) (“Zambezi”) preference shares.

The group has returned R20.6 billion of value to shareholders over the last two financial years (F2022 and F2021) through the acquisition of Zambezi preference shares and Northam Platinum shares, which collectively culminated in a 28.9% reduction in the group’s issued share capital through the early maturity of the Zambezi BEE transaction.

The company is currently at a critical juncture in our growth trajectory, with various potential alternative outcomes which remain to be determined. These outcomes will inform our approach to dividends.

The board of directors of the company (“board”) has therefore resolved not to declare a final dividend for the year ended 30 June 2022 (F2021: R Nil per share). 

ANNUAL GENERAL MEETING

The annual general meeting of shareholders (“AGM”) will be held on Tuesday, 25 October 2022 at 10:00 to transact the business as stated in the Notice of the 2022 Annual General Meeting (“notice of 2022 AGM”). 

The AGM will be held entirely by way of electronic participation. Shareholders are encouraged to read the notice of 2022 AGM for information on how to electronically attend, participate in and vote at the AGM.

Shareholders are advised that the notice of 2022 AGM, containing the summarised audited annual financial statements for the year ended 30 June 2022, will be distributed to shareholders today, 26 August 2022.

The annual integrated report for the year ended 30 June 2022, the complete consolidated audited annual financial statements which incorporates the external auditor’s report in which Ernst & Young Inc. expressed an unmodified audit opinion and the notice of 2022 AGM, are available on the company’s website at https://www.northam.co.za/investors-and-media/publications/annual-reports or can be obtained from the company’s registered office on request.

The salient dates for the AGM are as follows:

* Any forms of proxy not lodged by this date and time must be submitted electronically to the chairperson of the AGM before the start of the AGM, as set out in the notice of 2022 AGM, before the appointed proxy may exercise any rights of the shareholder at the AGM.

This short-form announcement is the responsibility of the directors of the company and is only a summary of the information contained in the full results announcement and does not contain full or complete details.

Any investment decision should be based on the full results announcement accessible via the JSE link at https://senspdf.jse.co.za/documents/2022/JSE/ISSE/NPHE/AFS_2022.pdf and available on Northam’s website at https://www.northam.co.za/investors-and-media/publications/annual-reports

The consolidated audited annual financial statements, from which the full results announcement has been extracted, have been audited by Ernst & Young Inc. The key audit matters contained in the auditor’s report are addressed on page 15 of the consolidated audited annual financial statements, which are available on Northam’s website at https://www.northam.co.za/investors-and-media/publications/annual-reports

The full results announcement and the consolidated audited annual financial statements for the year ended 30 June 2022, incorporating the auditor’s report, are also available at our registered office and at the offices of our sponsor for inspection, at no charge, during office hours.

On behalf of the board at Johannesburg on 26 August 2022.

TI Mvusi         Independent non-executive chairman
PA Dunne       Chief executive officer

* British

Registered office
Building 4, 1st Floor, Maxwell Office Park
Magwa Crescent West
Waterfall City
Jukskei View, 2090
South Africa

PO Box 412694
Craighall, 2024
South Africa

Telephone +27 11 759 6000
www.northam.co.za

Company secretary
PB Beale
Building 4, 1st Floor, Maxwell Office Park
Magwa Crescent West
Waterfall City
Jukskei View, 2090
South Africa

e-mail: trish.beale@norplats.co.za

PO Box 412694
Craighall, 2024
South Africa

Transfer secretaries
JSE Investor Services Proprietary Limited
13th Floor
19 Ameshoff Street
Braamfontein, 2001
South Africa

PO Box 4844
Johannesburg, 2000
South Africa
Telephone: +27 11 713 0800 / 086 147 2644
e-mail: InvestorServices@jseinvestorservices.co.za

Sponsor to Northam Holdings and debt sponsor to Northam Platinum
One Capital
17 Fricker Road
Illovo, 2196
Johannesburg
South Africa

PO Box 784573
Sandton, 2146
South Africa

Johannesburg
26 August 2022