Production fillip for Sibanye
Local mines belonging to gold and platinum group metals miner Sibanye-Stillwater exceeded production and cost forecasts in the year to December, which would assist in paying down debt in 2018, it said.
Local mines belonging to gold and platinum group metals (PGM) miner Sibanye-Stillwater exceeded production and cost forecasts in the year to December, which would assist in paying down debt in 2018, the company said on Monday.
Its share price dropped 1.19% to R13.29 after it released the operational update.
Noah Capital Markets analyst Rene Hochreiter said the move was in line with broader market trends. There appeared to be a widespread correction in equities as US bond yields had risen in anticipation of a US interest rate hike.
Sibanye-Stillwater, which recently offered to buy troubled PGM miner Lonmin for shares, also bought US PGM producer Stillwater early in 2017 for $2.2bn, financed through debt and equity.
More details on its debt will be revealed in its financial report on February 22.
It warned in October it would make an attributable loss of at least R4.6bn for the year due to impairments, provision for a silicosis settlement and transaction costs, but it may update these figures before February 22.
The consensus view of 13 analysts expressed in a survey by Bloomberg is that Sibanye will report a R2.6bn net loss, with net debt at R24.2bn. Hochreiter said it was highly unlikely that Sibanye would declare a dividend for the year. If it made any distribution, it would probably be in shares.
The mining group produced 1.4-million ounces of gold in 2017, more than its guidance of 1.35-million to 1.38-million ounces, showing a 4% increase in gold output in the second half compared with the first, despite the closure of the Cooke operations in October, it said.
The all-in sustaining cost was about $1,130/oz.
Sibanye’s PGM output in SA was 1.19-million ounces at an all-in sustaining cost of $775/oz. In the eight months since it bought Stillwater, the US miner produced about 376,300oz of PGMs, in line with guidance, while recycling volumes were at record levels. The all-in sustaining cost at Stillwater was about $650/oz, at the upper end of previous guidance.