Yesterday I attended Feli Nandi's show at Hard Rock Café in Sandton, Johannesburg — and what a night it was. The show was epic. Just when we thought the legacy of voices like Chiwosino Maraire was gone, Feli reminded us that the genre lives on. https://x.com/NandiFeli?t=p7yxFWzqtvHM6HD13b-QPg&s=08 Feli Nandi is the real deal. The woman is good — her voice, her energy, her ever-smiling presence lit up the whole stage. She’s a true people’s person. The crowd fed off her vibe and she gave it right back. Flanked by friends and fellow artists like Joe Thomas (yes, the Joe Thomas of “I Wanna Know”), Makhadzi and others, she held her own and more. It’s worth it to attend her shows — you leave feeling uplifted. She performed to a fully packed café. Zimbabweans came out strong to support the gig. Some were dressed traditionally, proudly showing off culture. I remember one couple in matching colors — it was beautiful to see. Feli herself was dressed in white, glowing under the lig...
Get link
Facebook
X
Pinterest
Email
Other Apps
An underappreciated gold mine that’s worth a closer look
Get link
Facebook
X
Pinterest
Email
Other Apps
-
Pan African Resources may be relatively small, but its strengths are worth noting.
The Pan African Resources operation in Barberton in Mpumalanga. Image: Supplied
Of all the JSE-listed gold miners, I get the sense that Pan African Resources plc is just simply underappreciated.
Why? Probably because it is relatively small. Yet size is not necessarily correlated with quality, and the gold junior stacks up well against even the majors.
Despite its modest R7.5 billion market cap, the group’s latest operational update reveals that it managed to produce 201 608 ounces of gold in its 2021 financial year. This is a better production profile than DRDGold’s latest annualised production despite DRD having a market cap of R12.8 billion.
Perhaps more important than ounces are profitable ounces (something the mining industry seems to have only recently remembered).
At the last reported date, Pan African Resources was the second lowest cost producer on the local bourse (beaten only by Gold Fields).
No surprise, but the legacy operations of Sibanye-Stillwater are the most expensive per ounce produced.
JSE-LISTED GOLD MINERS
ANNUALISED LAST PRODUCTION
LATEST ALL-IN SUSTAINING COST (USD/OZ)
GOLD FIELDS
2 164 000 oz
$1 078/oz
PAN AFRICAN RESOURCES
201 608 oz
$1 252/oz
ANGLOGOLD ASHANTI
2 352 000 oz
$1 287/oz
DRDGOLD
177 732 oz
$1 343/oz
HARMONY
1 499 032 oz
$1 416/oz
SIBANYE-STILLWATER (GOLD)
997 568 oz
$1 606/oz
Source: Various company reports
For some background, perhaps listen to Pan African Resources’S latest update in this MoneywebNOW podcast.
The two key highlights are:
FY21 gold production is 12.3% higher year on year; and
Net senior debt has basically halved (down 45% year on year).
Additional upsides
Beyond this, Pan African Resources has a range of projects that either derisk its operations (such as solar power that should be operational in Q3 this year) or expand its production (such as its Mintails transaction) – or which support the communities in which it operates above and beyond the environmental, social and governance minimums, such as its Project Blue initiative (it is converting land into a modern blueberry farm to provide sustainable employment for the community of Barberton).
All positives, all likely to incrementally add value, and all – probably – not appreciated by the market.
Listen to Simon Brown’s interview with Pan African Resources CEO Cobus Loots in this MoneywebNOW podcast (or read the transcript here):
Adding to this attractiveness is Pan African Resources’s strong dividend policy: other than FY18, it has consistently paid out a generous portion of its profits as a dividend to shareholders, and management has reiterated its intention to keep doing this.
Its excellent dividend history sets a high benchmark against which many other gold miners fail.
More subtly, this dividend flow from Pan Africa Resources allows investors to hold what is effectively a (dividend) yielding investment in a geared exposure to the rand-gold price. There is a lot in that sentence, so let me break it down in my conclusion:
Pan African Resources offers a domestic investor the following exposure:
Rand-gold exposure: Its revenue is earned by selling gold priced in US dollars and translating this back to rands. Thus, you get both gold price and currency movements (so-called ‘rand-gold price’) embedded in this revenue stream.
Geared exposure to this rand-gold price: Its mine running costs are largely fixed and do not change with the changes in the rand-gold price. Thus, the group has strong operating leverage; if the rand-gold price moves higher, this change drops to the bottom line creating a leveraged effect on its profits. Thus, if the rand-gold price is running higher, Pan African Resources can outperform this movement.
(Dividend) Yielding rand-gold play: If you bought an ounce of gold in South Africa, you would have one-to-one exposure to the rand-gold price. That said, no matter how long you held that ounce of gold, you would still only have an ounce of gold and would have earned no interest on the capital invested. Pan African Resources pays dividends from its profits; thus you get the (geared) exposure to rand-gold, but also earn a yield on your capital here (imagine a bank account offering your capital exposure to rand-gold with an attractive interest rate attached!).
7/19/2021, 4:55:40 PM
In closing, I get the sense that Pan African Resources is often underappreciated – and honestly, I don’t think it should be.
It is a good quality junior gold miner with strong management, and the latest operational update further illustrates this.
Keith McLachlan is investment officer at Integral Asset Management.
He holds shares in Pan African Resources.
Integral Asset Management’s clients may hold shares in Pan African Resources.
USINESS REPORT COMPANIES MultiChoice’s black economic empowerment scheme is looking for about 22 000 shareholders who owned shares and did not receive dividends of R207 million between 2006 and 2020. Picture: Karen Sandison/African News Agency(ANA) MultiChoice’s BEE scheme trying to find 22 000 shareholders who are missing out on millions By Edward West Feb 16, 2021 CAPE TOWN - PHUTUMA Nathi, the MultiChoice black economic empowerment scheme of more than 80 000 shareholders, is looking for about 22 000 shareholders who owned shares and did not receive dividends of R207 million between 2006 and 2020. “This money belongs to our shareholders. We’re calling on them to contact us to get their money. In these tough economic times we want to do everything in our power to give them what is rightfully theirs,” Phuthuma Nathi chairperson Mandla Langa said in a statement yesterday. Phuthuma Nathi has been paying dividends every year since the start of the scheme in 2006. Am...
Visual Capitalist Elements | September 15, 2021 | 8:58 am Intelligence Australia USA Coal The Countries With the Largest Coal Reserves Cheap and abundant coal remains one of the largest sources of energy worldwide, even as governments set out goals to reduce greenhouse gas emissions. While jurisdictions in Europe and North America have been phasing out coal use in power generation, it has been on the rise in Asia. China and India are scrambling to provide electricity to a growing population and relying on coal power plants to meet demands despite the environmental costs. SIGN UP FOR THE ENERGY DIGEST Sign Up This infographic takes a look into the BP Statistical Review of World Energy 2021 , and the 11 countries that make up 89% of the coal reserves globally. Coal Reserves, by Country While countries need to phase out coal by 2040 to achieve the Paris Agreement goal of limiting global warming to 1.5ºC, consumption in key ...
Being a resident of the South African Community, l have came to realize that in some cases we have Car hijackings that will leave one to wonder what will have happened and where did those robbers comes from. The events unfold in a very fast and violent manner which no-one will be prepared for. Its so traumatic, horrific and in some cases individuals end up loosing their lives. l realized that these individuals who carry out such bad things works with someone who either will be seeing you close by or else you will be drinking on the same counter in a bar and he is relaying the information to those waiting for you outside. It's so unfortunate that some people that we meet are not there for the social life that you go for. They are on a mission to take you down. It is difficult to raise public awareness and advise people to be vigilant. However a few tips can try to raise awareness such as if you see that you are being followed drive to the nearest police station. In publ...
COMMENTS 5
You must be signed in to comment.
SIGN IN SIGN UP