Wrap Text
Operating and financial results for the six months ended 30 June 2018
SIBANYE GOLD LIMITED
Trading as SIBANYE-STILLWATER
Incorporated in the Republic of South Africa
Registration number 2002/031431/06
Share code: SGL
Issuer code: SGL
ISIN: ZAE E000173951
Operating and financial results
For the six months ended 30 June 2018
JOHANNESBURG, 23 August 2018: Sibanye Gold Limited trading as Sibanye-Stillwater (Sibanye-Stillwater or the Group) (JSE: SGL and NYSE: SBGL)
is pleased to report operating results and reviewed condensed consolidated interim financial statements for the six months ended 30 June 2018.
SALIENT FEATURES FOR THE SIX MONTHS ENDED 30 JUNE 2018 COMPARED TO SIX MONTHS ENDED 30 JUNE 2017
- Group adjusted EBITDA2 increased by 26% to R3.9 billion (US$316 million)
- Further operational improvement from the SA PGM operations with 2% lower AISC of R10,106/4Eoz (US$821/4Eoz) and adjusted EBITDA
increasing by 115% to R1,001 million
- Another solid performance from the US PGM operations with 2E PGM production of 293,959oz and AISC of US$653/2Eoz and the Blitz project
remains ahead of schedule
- On a like-for-like basis (excluding the Cooke operations) production from the SA gold operations declined by 7% to 18,616kg (598,500oz) with
AISC 7% higher to R520,488/kg (US$1,315/oz), mainly as a result of lower volumes
- Good operational recovery by Beatrix and Kloof from safety related disruptions, with only Driefontein not fully recovering
- Deleveraging accelerated through US$500 million stream financing in July 2018, resulting in pro forma ND:adjusted EBITDA reducing to
approximately 1.85x
- Lonmin acquisition remains on track with approval received from SARB and the competition authority in the UK
US dollar SA rand
Six months ended Six months ended
Jun 2017 Dec 2017 Jun 2018 KEY STATISTICS Jun 2018 Dec 2017 Jun 2017
SOUTHERN AFRICA (SA) REGION
PGM operations
590,712 603,636 569,166 oz 4E PGM(1) production kg 17,703 18,775 18,373
910 975 1,051 US$/4Eoz Average basket price R/4Eoz 12,941 13,066 12,006
35.2 84.6 81.3 US$m Adjusted EBITDA(2) Rm 1,001.1 1,128.4 465.6
8 16 15 % Adjusted EBITDA margin(2) % 15 16 8
785 778 821 US$/4Eoz All-in sustaining cost(3) R/4Eoz 10,106 10,432 10,364
Gold operations
688,604 714,260 598,517 oz Gold produced kg 18,616 22,216 21,418
1,233 1,274 1,314 US$/oz Average gold price R/kg 519,994 549,064 523,303
170.8 228.0 81.8 US$m Adjusted EBITDA(2) Rm 1,007.1 3,052.5 2,256.0
20 25 10 % Adjusted EBITDA margin(2) % 10 25 20
1,143 1,114 1,315 US$/oz All-in sustaining cost(3) R/kg 520,488 480,010 485,441
UNITED STATES (US) REGION
PGM operations(4)
93,725 282,631 293,959 oz 2E PGM(1) production kg 9,143 8,791 2,915
126,445 390,703 360,246 oz PGM recycling(4) kg 11,205 12,152 3,933
850 947 996 US$/2Eoz Average basket price R/2Eoz 12,260 12,699 11,242
27.9 133.1 153.3 US$m Adjusted EBITDA(2) Rm 1,887.4 1,774.5 368.1
19 25 25 % Adjusted EBITDA margin(2) % 25 25 19
622 660 653 US$/2Eoz All-in sustaining cost(3) R/2Eoz 8,045 8,899 8,134
GROUP
(363.8) 30.6 6.4 US$m Basic earnings Rm 76.7 366.3 (4,803.7)
(165.2) 148.4 8.2 US$m Headline earnings Rm 101.0 1,957.9 (2,181.8)
233.9 445.7 316.4 US$m Adjusted EBITDA Rm 3,895.6 5,955.4 3,089.7
13.21 13.41 12.31 R/US$ Average exchange rate
(1) The Platinum Group Metals (PGM) production in the SA region is principally platinum, palladium, rhodium and gold, referred to as 4E (3PGM+Au), and in the US region is principally platinum
and palladium, referred to as 2E (2PGM).
(2) The Group reports adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) based on the formula included in the facility agreements for compliance with the debt
covenant formula. For a reconciliation of profit/loss before royalties and tax to adjusted EBITDA, see note 9.2 of the condensed consolidated interim financial statements. Adjusted EBITDA
margin is calculated by dividing adjusted EBITDA by revenue.
(3) See "salient features and cost benchmarks for the six months ended 30 June 2018, 31 December 2017 and 30 June 2017" for the definition of All-in sustaining cost.
(4) The US PGM operations' underground production is converted to metric tonnes and kilograms, and performance is translated to SA rand. In addition to the US PGM operations'
underground production, the operation treats recycling material which is excluded from the 2E PGM production, average basket price and All-in sustaining cost statistics shown. PGM recycling
represents palladium, platinum, and rhodium ounces fed to the furnace. As the US operations were only acquired in May 2017, the period ended 30 June 2017 represents only two months.
Stock data for the six months ended 30 June 2018 JSE Limited - (SGL)
Number of shares in issue Price range per ordinary share R7.45 to R16.64
- at 30 June 2018 2,265,879,337 Average daily volume 12,608,577
- weighted average 2,261,752,549 NYSE - (SBGL); one ADR represents four ordinary shares
Free Float 80% Price range per ADR US$2.25 to US$5.27
Bloomberg/Reuters SGLS/SGLJ.J Average daily volume 3,921,062
STATEMENT BY NEAL FRONEMAN, CHIEF EXECUTIVE OFFICER OF SIBANYE-STILLWATER
The six month period ended 30 June 2018 (H1 2018), was extremely challenging for all Sibanye-Stillwater stakeholders. The spate of
fatalities at our SA operations was traumatic and emotionally testing for everyone at Sibanye-Stillwater. Safety is a core component
of our CARES (Commitment, Accountability, Respect, Enabling Environment, Safe Production) values and our values guide every
decision made, every day. We employ over 66,000 people globally and our success is enabled and driven by our people. Nothing
is more important to all of us at Sibanye-Stillwater than safe production. As such, the recent events have caused much concern and
we are implementing a comprehensive safety remediation plan in order to re-instil core, safe working practices at our operations.
The significant operational disruptions associated with these tragic events were compounded by the challenging operating
environment prevailing during the period. The acute appreciation of the rand in the early part of the year, combined with volatile
dollar prices of precious metals which came under pressure later in the period due to global developments, severely squeezed SA
margins.
Considering the challenging economic backdrop in H1 2018 and the significant operational disruptions faced at our SA gold
operations, the generally solid, overall operating and financial results delivered by the Group are pleasing, confirming the rationale
for geographical and commodity diversification, as well the Sibanye-Stillwater's inherent capacity to successfully accommodate
and integrate acquisitions in different geographies and sectors.
Despite the significant disruptions across the SA gold operations, Beatrix and Kloof delivered solid results. Production from both
operations was marginally lower than for the comparable period in 2017 and All-in Sustaining Cost (AISC) increases were below
inflation (South African CPI). Only the Driefontein operations were unable to recover due to seismic damage to the footwall
infrastructure that provides access to the western side of the Masakhane mine. Rehabilitation efforts are underway but access to the
area will be restricted until Q1 2019, following which normal levels of production from Driefontein are expected to resume.
The SA and US PGM operations continued to perform well in H1 2018, delivering on their production targets and generating solid
financial outcomes in an improved rand basket price environment during the period. The PGM operations in both regions delivered
positive cash flow for the period, largely offsetting the decline from the SA gold operations and validating the commodity and
geographic diversification undertaken by the Group since 2015.
The graphs below reflect the diversification benefits, with quarterly Group adjusted EBITDA in 2018 higher than for the comparable
periods in 2017 and with adjusted EBITDA from the US and SA PGM operations consistently increasing. This offset the decline in
adjusted EBITDA from the SA gold operations.
On the back of a steady production outlook and continued appreciation of the rand PGM basket price during the year, the SA PGM
operations' contribution to Group adjusted EBITDA is likely to increase further in H2 2018. At the US PGM operations, the ongoing ramp
up to full production at Blitz likely to continue to drive higher revenue and lower unit costs.
Our confidence in the positive fundamental outlook for both palladium and platinum remains intact, despite the recent abrupt
decline in spot prices. The decline appears to be driven by short term speculative trading and fueled by the uncertain economic
impact of recent global trade hostilities. Further restructuring, which was recently announced by our SA PGM industry peers, is
consistent with, and supports our fundamental view of impending deficits.
The outlook for the SA gold operations remains similarly positive, despite production from the western side of Driefontein's Masakhane
shaft being constrained while the rehabilitation project continues. Unit costs during this period will also be temporarily elevated. From
Q1 2019 production levels should revert to normal with an expected commensurate decline in unit costs.
Despite the imperative of addressing safety and other operational issues experienced during H1 2018, we have maintained focus on
the execution of our strategy. As a critical element in our accelerated deleveraging, US$500 million was raised, post interim end,
through a well-structured and competitively priced streaming transaction. At the end of H1 2018, our ND:adjusted EBITDA ratio was
2.55x, having declined from 2.56x at the end of the 2017 financial year. The US$500 million upfront cash raised through the stream,
enables an approximate 0.7x reduction in Group ND:adjusted EBITDA at the end of H1 2018, thereby reducing the Group leverage
ratio to approximately 1.85x on a pro forma basis. This is well below the 3.5x existing covenant and future 2.5x covenant ratios. The
stream was generally well received by the market and was followed by a sharp decline in open short trading positions. Other
measures to further accelerate deleveraging continue to be assessed.
Positive progress was made in bringing the proposed Lonmin transaction to completion, with approvals obtained from both the South
African Reserve Bank and the Competition and Markets Authority (CMA) in the UK. The approval process with the South African
competition authorities continues. The transaction is subject to the fulfilment of certain other conditions precedent and is expected
to complete during the second half of 2018.
Progress was also made on realising value from non-core assets. The DRDGOLD transaction, in terms of which selected gold surface
assets and reserves have been sold to DRDGOLD for a 38% equity stake in the company, was concluded in late July 2018. An earn-
in transaction was entered into with Regulus Resources Inc. regarding the Altar copper-gold project in Argentina, which will see
Sibanye-Stillwater benefitting from an upfront cash payment of US$15 million, while still retaining significant exposure to potential
upside in the Altar project. More detail on these transactions is provided in the corporate activity section below.
We have managed to navigate our way through a very challenging period and I am confident that we have emerged in a stronger
position than we were at the beginning. The Group has been refocused and re-energised and I am confident that we are well
positioned to deliver significant value to all of our stakeholders in future.
SAFETY
The Group suffered a number of tragic safety incidents during H1 2018. Q2 2018 was dominated by two safety disasters in which 12
of our colleagues passed away in separate incidents at our Driefontein and Kloof mines. A seismic event on 3 May 2018 at
Driefontein's Masakhane shaft resulted in severe damage to the workings with seven of our employees fatally injured and a further
six rescued. On 11 June 2018, five employees passed away when a shift boss led employees into a temporary stopped barricaded
area. Severe events of this nature, leading to multiple fatalities at the SA Gold operations, are unparalleled in Sibanye-Stillwater's
history and are a significant departure from our safety performance. Investigation of these events by the DMR continues.
Sibanye-Stillwater management and Board, express their sincere condolences to the family and colleagues of the employees who
perished during the period. In Q1: Solly Ngobeni, Chicco Dube, Matela Mating, Zanempi Mncwazi, Otshepeng Ramosito and Ntokozo
Ntame and in Q2: Mlungisi Vukuthi , Luke Bongumusa Mngomezulu, Baptista Paulino Cuambe, X-Mas Madikizela, Mbulelo Albert
Sonqowa, Thabo Abram Ntsekhe, Nkosiphendule Dudlela, Luis Ernesto LumbeGazala, Thokozani Tembe, Lingani Innocent Mngadi,
Lakhi Msada, Mthokozisi Msutu, Cedrick Nkuna, Kholekile Phelile and Bhekithemba Thembinkosi Ndabeni.
On a positive note, it is pleasing to report that Beatrix has now been fatality free for more than 15 months and that there were no
fatal incidents at the SA PGM operations in Q2.
We continue to take structured and well-defined steps to restore our SA gold operations back to industry leading safety performance.
At our 2017 year end results presentation in February this year, I stated that in order to break through the safety plateau we had
reached we would need to do things differently by impacting attitude and safe behaviour, and that a Health and Safety compact
between all stakeholders was necessary if we were to achieve ZERO HARM in the workplace. ZERO HARM involves rethinking and
recommitting to building bridges of collaboration between every stakeholder in the mining sector. It is our singular focus to improve
mine safety and enhance the values-based behaviours that will achieve that success.
We convened a multi-stakeholder Safety Summit on 25 May 2018, which was well attended by all the unions and the DMR as well as
senior management from Sibanye-Stillwater. All the stakeholders committed to working together to make the workplaces safer,
protect jobs and collaborate on all matters pertaining to the health, safety and wellbeing of workers. A safety pledge was jointly
developed setting out the scope and spirit in which stakeholders agree to work further towards achieving ZERO HARM underpinning
a substantial shared resolve to jointly strive to address the safety challenges. This is a significant achievement and the first time that I
am aware that all stakeholders in the industry have committed to a compact of this nature.
The Safety Summits are ongoing and joint implementation task teams will monitor and report on progress made in implementing the
priority areas that were jointly identified by stakeholders at the summits.
Considering the substantial behavioural component involved in most fatal incidents, organisational culture and leadership are being
reviewed to ensure that safety is inculcated as the foremost consideration in decisions at all levels. The need has been identified to
re-instil our CARES values as the context within which we take all our decisions as a cornerstone of culture transformation. An intense
programme to promote the responsible application of the provisions of Section 23 of the Mine Health and Safety Act, which affords
employees the right to withdraw from unsafe conditions, confirms our top level commitment to safe operations.
In the US region, the operations have been fatality free since October 2011. The total injury frequency rate for H1 2018 increased to
18.2 compared to a rate of 12.7 per million hours in 2017, while the serious injury frequency rate also increased to 8.8 from 5.9 per
million hours when comparing H1 2018 to 2017. Although no common theme with the increase in the injury rates could be established,
US region management continues to address this disappointing increase as a priority.
A recognised expert in mine safety, Dr Kobus de Jager has been appointed as Group Head of Safe operations. Kobus has over 40
years' experience in mine safety with academic and practical credentials in leadership and behavioural safety. His primary remit will
be to fully review the Company's safety management systems and processes.
FINANCIAL OVERVIEW
Group revenue of R23,910 million (US$1,942 million) for H1 2018 was 24% higher than for the comparable period in 2017. The inclusion
of a full six months production from the US PGM operations which were acquired in May 2017, and higher PGM basket prices, offset
lower revenue from the SA gold operations, which declined by R1,596 million (US$67 million). Revenue for the SA gold operations was
impacted by the 13% decline in gold produced, primarily due to the closure of the Cooke operations in H2 2017 and the impact of
operational disruptions at the Driefontein operations, compounded by a 1% decline in the average rand gold price received to
R519,994/kg (US$1,314/oz).
Group adjusted EBITDA for the six months ended 30 June 2018 of R3,896 million (US$316million) increased by 26% year-on-year,
positively impacting Group leverage measures.
Primarily due to the successful refinancing of the bridge loan, net finance expenses for H1 2018 decreased by R52 million (US$3 million)
year-on-year to R1,193 million (US97 million).
A R710 million (US$58 million) gain on financial instruments compared to a R261 million (US$20 million) loss for the previous comparable
period, was largely due to the decline in the market value of the US$450 million Convertible Bond during H1 2018.
The financial results for H1 2017 were significantly affected by transaction and financing costs associated with the acquisition of
Stillwater, and higher restructuring costs and impairments associated with the early, decisive action taken by the Group to address
losses at its SA gold operations (resulting in the cessation of mining at the Cooke underground operations and jointly agreed
interventions at the Beatrix West mine). These costs were compounded by a R1,077 million (US$82 million) occupational healthcare
expense being recognised in anticipation of a possible settlement of class action claims and related costs, resulting in combined
non-underlying costs of R4,423 million (US$335 million). Following the resumption of more normal operating activities, the costs
(combined) for H1 2018, were R4,066 million (US$330 million) lower at R357 million (US$29 million) than for H1 2017.
The Group recorded a net profit of R78 million (US$7 million) for H1 2018 compared with a loss of R4,803 million (US$364 million) for the
comparable period in 2017.
The Normalised loss (attributable earnings adjusted for non-cash gains and losses, non-recurring items and share of result of equity-
accounted investees) for the six months ended 30 June 2018 of R521 million (US$42 million), was significantly less than the
R1,002 million (US$76 million) normalised loss reported for the first half of the previous year.
OPERATING REVIEW
SA REGION
SA PGM operations
The SA PGM operations delivered another robust operating result for the six months ended 30 June 2018, with attributable 4E PGM
production of 569,166oz marginally lower than for the comparable period in 2017, but at the upper end of guidance for 2018 on an
annualised basis. Despite lower production, AISC declined further to R10,106/4Eoz (US$821/4Eoz), 4% lower in nominal terms than for
the comparable period in 2017. This reflects a significant reduction in unit costs in real terms despite these operations absorbing
above inflation increases in wages and electricity costs over the course of the year. This excellent result reflects the tangible and
sustainable benefits derived from the integration of these operations into the Sibanye-Stillwater group.
Kroondal in particular excelled, with 4E PGM production of 120,461oz, 5% higher than for the comparable period in 2017 and AISC
of R10,187/4Eoz, 1% lower.
The average PGM basket price for the six months ended 30 June 2018, was 8% higher in rand terms than the comparable period in
2017 at R12,941/4Eoz and 16% higher in dollar terms at US$1,051/4Eoz. This increase was primarily due to significantly higher palladium
and rhodium prices (which comprise approximately 30% and 8% of the 4E PGM basket respectively), which offset the impact of the
strong rand in the first quarter.
The financial contribution from by-product metals is significant, with chrome in particular contributing to revenue and reducing AISC.
By-product credits reduced AISC from the SA PGM operations by R1,040 million (US$84.4 million) in H1 2018.
Contributions from Mimosa was also consistent and contributed a further R136 million (US$11 million) to Group earnings.
The significant operational turnaround achieved at the SA PGM operations, and the inherent gearing of these operations to higher
PGM basket prices is clearly evident in the vastly improved financial results for the period under review. Adjusted EBITDA more than
doubled from R466 million (US$35 million) for H1 2017 to R1,001 million (US$81 million) for H1 2018, with the SA PGM operations'
contribution to Group adjusted EBITDA increasing from 15% in H1 2017 to 26% in H1 2018.
This is a notable reversal in the fortunes of these SA PGM operations, which generated significant losses for many years and reinforces
the rationale of industry consolidation.
SA gold operations
Gold production from the SA gold operations was 13% lower year-on-year, declining from 21,418kg (688,600oz) for H1 2017 to 18,616kg
(598,500oz) for H1 2018, with AISC increasing by 7%, to R520,488/kg (US$1,315/oz). On a like-for-like basis, after normalising for the
closure of the Cooke underground operations in H2 2017, which accounted for 1,308kg (42,000oz) of the production difference,
production declined by 7% or 1,494kg (48,033oz). This shortfall in production resulted largely from a number of operational disruptions
during the period, including the power outage at Beatrix in February 2018 due to severe storm damage to Eskom power lines
supplying the mine, the tragic fatal incidents at the West Wits gold operations and seismic damage to infrastructure providing access
to sections of the Driefontein Masakhane shaft. Kloof and Beatrix performed well despite these disruptions, with only Driefontein not
able to compensate for lost production.
The average rand gold price declined by 1% to R519,994/kg for H1 2018, despite the average dollar gold price increasing by 7% to
US$1,314/oz, due to significant appreciation of rand in Q1 2018, yielding an average exchange rate of R12.31/US$ for H1 2018,
compared with R13.21/US$ for H1 2017. As a result of these factors, revenue from the SA gold operations declined by R1,596 million
(US$67 million) year-on-year to R9,680 million (US$786 million). Cost of sales, before amortisation and depreciation decreased by
approximately 6% in absolute terms, to R8,373 million (US$680 million) resulting in a R1,249 million (US$89 million) decline in adjusted
EBITDA, to R1,007 million (US$82 million), with the SA Gold operations' contribution to Group adjusted EBITDA declining to 26% from
73% in H1 2017.
Underground production from Kloof of 6,775kg (217,800oz) was only marginally lower than for the comparable period in 2017, with
an 11% decline in underground throughput, largely offset by a higher yield due to an 8% improvement in the Mine Call Factor. Surface
throughput increased by 59% to 2,699,000 tonnes due to an increase in toll treatment of Kloof surface sources at the Driefontein and
Ezulwini plants, but at a lower yield of 0,42g/t, resulting in gold produced from surface sources increasing by 43% to 1,130kg (36,300oz).
AISC increased by 5% to R464,301/kg (US$1,173/oz), which was in line with South African CPI inflation; a commendable result.
Beatrix recovered well from the electrical power outage in February 2018, with underground gold production of 4,275kg (137,500oz)
2% lower than for the comparable period in 2017. A 9% increase in the underground yield largely offset the 10% decline in
underground throughput largely due to the power disruption. Gold production from surface sources decreased 27% to 105kg
(3,400oz), which was expected due to depletion of surface reserves at Beatrix West. The 2% increase in AISC year-on-year to
R511,712/kg (US$1,293/oz) was lower than South African CPI inflation and is a solid performance, considering that above inflation
wage and electricity cost increases had to be absorbed during the year.
Driefontein was unable to recover from operational disruptions during H1 2018 due to the cessation of mining activity on the western
side of the Masakhane shaft from 3 May 2018, following seismic damage to footwall infrastructure providing access to the area.
Underground production from Driefontein of 5,349kg (172,000oz) for H1 2018, was 20% lower than for the comparable period in 2017.
Production from surface sources at Driefontein also declined by 52% to 441kg (14,200oz), due to the depletion of available surface
reserves, resulting in AISC increasing substantially to R603,092/kg (US$1,524/oz).
Rehabilitation of the affected footwall infrastructure at the Masakhane shaft has commenced, with ramp up to normal levels of
production of approximately 250kg (8,038oz) per month, expected to be achieved by April 2019, with costs returning to more normal
levels.
US REGION
US PGM operations
The US PGM operations delivered another solid operating result, with mined 2E PGM production of 293,959oz at an AISC of
US$653/2Eoz, consistent with annual guidance for 2018. This performance compares favourably with 2E PGM production of 282,631oz
at an AISC of US$660/2Eoz for the six-months ended 31 December 2017 (H2 2017), and reflects initial production from the Blitz project
(Blitz). Blitz remains ahead of schedule, having produced approximately 20,200 2Eoz in H1 2018, with a further increase in production
rate expected during H2 2018. The ramp up of Blitz to full 2E PGM production of approximately 300,000oz by the end of 2021, is
expected to continue to drive revenues from the US PGM operations higher, and AISC lower by approximately US$100/2Eoz, to
around US$550/2Eoz.
The Columbus Metallurgical Complex processed 308,253oz of mined 2E PGM and 360,246oz of recycled 3E PGM, marginally lower
than for H1 2017. Our recycling operation averaged 23.8 tonnes of feed material per day for H1 2018 compared to 23.9 tonnes per
day during H2 2017. Following a matte run out at the second electric furnace (EF2) in February 2018, a decision was made to not
repair the furnace but to progress the planned 2018 rebuild and expansion of EF2 to cater for future Blitz throughput. The restart of
EF2 is expected in the fourth quarter of 2018. The runout at EF2 resulted in a short-term lock-up of mined and recycled material in
process. This locked up metal in inventory is expected to be released during H2 2018.
Metal prices remained elevated for most of H1 2018 and the average 2E PGM basket price was US$996/2Eoz, 5% higher than the
average basket price of US$947/2Eoz for H2 2017. The US PGM operations contributed US$153 million (R1,887 million) to Group
adjusted EBITDA at an average adjusted EBITDA margin of 25% in H1 2018, with the recycling operation comprising US$10 million
(R123 million) of this total.
Capital expenditure in the US region for H1 2018 was US$99 million, including project capital at Blitz. Capital expenditure for the period
includes US$5 million spent on exploration at Altar in Argentina and Marathon in Canada.
CORPORATE ACTION
The DRDGOLD transaction
As announced on 1 August 2018, all conditions precedent to the DRDGOLD transaction were met and the transaction was
implemented on 31 July 2018. Sibanye-Stillwater has sold selected gold processing and surface tailings storage facilities (TSFs), which
were a component of the West Rand Tailings Retreatment project (WRTRP), to DRDGOLD for the issue of 265,000,000 DRDGOLD new
ordinary shares, equivalent to 38.05% of the issued share capital of DRDGOLD, worth R895.7 million*.
In addition, Sibanye-Stillwater may, within 24 months from the date of implementation of the Transaction, exercise an option to
increase its shareholding in DRDGOLD up to 50.1%, by subscribing for additional shares which will be issued at a 10% discount to the
30 day volume weighted average traded price of a DRDGOLD share on the day prior to the date of exercise of the option.
The transaction unlocks immediate value from underutilised surface infrastructure and TSFs whilst retaining exposure to the future
development of this long life surface reclamation project and future growth in DRDGOLD.
Sibanye-Gold will be consolidating DRDGOLD in its operational and financial results in future, which is expected to have a positive
impact on production and financial metrics as well as gold Reserves and Resources. Further information on the transaction is
available at https://www.sibanyestillwater.com/investors/transactions/drdgold.
* DRDGOLD's closing share price of R3.38 as at 31 July 2018 multiplied by the 265 million shares issued to Sibanye-Stillwater.
Altar
On 29 June 2018 Sibanye-Stillwater announced it had entered into an agreement with Regulus Resources Inc. (Regulus) and a newly
formed subsidiary of Regulus, Aldebaran Resources Inc. (Aldebaran), to create a strategic partnership to unlock value at the Altar
copper-gold project located in Argentina.
The consideration to Sibanye-Stillwater, for Aldebaran's option to acquire up to an 80% interest in the Altar Project, comprises:
- An upfront cash payment of US$15 million to Sibanye-Stillwater upon closing of the Arrangement
- 19.9% of the shares of Aldebaran, subject to proration if the initial financing exceeds US$30 million (up to a maximum of
US$40 million)
- A commitment from Aldebaran to carry the next US$30 million of spend at the Altar Project over a maximum of five years, as an
initial earn-in of a 60% interest in the Altar Project (the Initial Earn-in)
- Aldebaran may also elect to earn into an additional 20% interest in the Altar Project by spending an additional US$25 million over
a three-year period following the Initial Earn-in.
The Arrangement sees Sibanye-Stillwater benefit from upfront proceeds (US$15 million), while retaining a direct interest in the project
of either 40% or 20% (should Aldebaran exercise its additional earn in option) as well as an indirect exposure though its 19.9%
shareholding in Aldebaran. The transaction is expected to close in Q4 2018.
The proposed Lonmin acquisition
The proposed all share acquisition of Lonmin Plc remains on schedule. South African Reserve Bank approval for the proposed
transaction was received in May, with the Competition and Markets Authority (CMA), the UK authority responsible for investigating
any merger that could restrict competition, unconditionally clearing the proposed acquisition in June 2018. Engagement with the
South African competition authorities continues. Pending the fulfilment of the remaining conditions precedent, we remain fully
committed to the transaction and believe that the rationale for the transaction remains compelling for all stakeholders. Further
information on the transaction is available at https://www.sibanyestillwater.com/investors/transactions/Lonmin.
Stream financing
On 25 July 2018, Sibanye-Stillwater announced the completion of a gold and palladium stream agreement with Wheaton Precious
Metals International Ltd (Wheaton International), in terms of which, Sibanye-Stillwater has received US$500 million from Wheaton
International in exchange for an agreed percentage of planned gold and palladium production from its US PGM operations
(comprised of the East Boulder and Stillwater mining operations).
The US$500 million arising from the Transaction is competitively priced relative to existing Group debt and alternative financing
available in international capital markets and immediately reduces Sibanye-Stillwater's leverage, decreasing Net Debt:adjusted
EBITDA by about 0.7x on a pro forma basis. This achieves a Group leverage ratio which is well below current and future covenant
levels as per the facility agreements and yields a reduction in Group financing costs. Further detail on the stream is available at:
https://www.sibanyestillwater.com/investors/events/streaming-transaction
Purported class action
Two purported class action lawsuits have been filed against Sibanye Gold Limited (Sibanye-Stillwater), Neal Froneman and Charl
Keyter in the United States District Court for the Eastern District of New York, alleging violations of the US securities laws. The first lawsuit,
Case No. 18-cv-03721, was filed on 27 June 2018 by Kevin Brandel, individually and on behalf of all other persons who purchased
Sibanye securities between 7 April 2017 and 26 June 2018, inclusive (the "Class Period"). The second lawsuit, Case No. 18-cv-03902,
was filed on 6 July 2018 by Lester Heuschen, Jr., also individually and on behalf of members of the Class Period (collectively, the
"Class Actions"). The Class Actions allege that certain statements by Sibanye-Stillwater in its annual reports filed with the US Securities
and Exchange Commission were false and/or misleading. Specifically, the Class Actions allege that Sibanye made false and/or
misleading statements about its safety practices and record and thereby violated the US securities laws. The Class Actions seek an
unspecified amount of damages.
As the cases are in the early stages, it is not possible to determine the likelihood of success on the merits or to quantify any potential
liability from the Class Actions nor estimate the duration of the litigation. Sibanye-Stillwater intends to defend the cases vigorously.
OUTLOOK
The operating/safety challenges experienced in H1 2018 have been our primary focus and are being proactively addressed. I am
confident that collaboration with key stakeholders will have a significant impact on safety at our mines. Restoring and then improving
the safety performance at our operations globally remains a priority.
Despite the difficult operating environment and potentially crippling operational challenges we have endured, the outlook for the
remainder of the year remains positive, with the weaker rand in particular providing significant earnings upside for the SA region.
4E PGM production from the SA PGM operations is likely to be at the upper end of guidance of between 1.1Moz and 1.15Moz, with
AISC towards the bottom end of guidance, of between R10,750/4Eoz and R11,250/4Eoz (US$825/4Eoz and US$860/4Eoz). Capital
expenditure is forecast at R1,200 million (US$92 million).
Guidance for the SA gold operations for the year ending 31 December 2018 was revised in July 2018 to between 36,500kg and
37,500kg (1.17Moz and 1.21Moz), with AISC forecast at between R515,000/kg and R530,000/kg (US$1,227/oz and US$1,263/oz) and
capital expenditure of R3,000 million (US$230 million).
2E PGM production guidance from the US PGM operations for the year ending 31 December 2018 is maintained at between
580,000oz and 610,000oz with AISC between US$640/2Eoz and US$680/2Eoz. Capital expenditure is expected to be up to
US$222 million.
NEAL FRONEMAN
CHIEF EXECUTIVE OFFICER
FINANCIAL AND OPERATING REVIEW OF THE SIBANYE-STILLWATER GROUP
FOR THE SIX MONTHS ENDED 30 JUNE 2018 (H1 2018) COMPARED WITH THE SIX MONTHS ENDED 30 JUNE 2017 (H1 2017)
Revenue
Revenue increased by 24% to R23,910 million (US$1,942 million) from R19,219 million (US$1,455 million). This included R7,441 million
(US$605 million) from the US PGM operations. The increase in revenue at the US PGM operations was due to the inclusion for the full
six months in H1 2018 compared with R1,946 million (US$147 million) for two months in H1 2017. Revenue from the SA PGM operations
increased by 13% to R6,789 million (US$552 million) due to chrome and by-product sales of R1,040 million, and a 8% higher average
4E basket price and partly offset by a 4% decline in 4E PGM production. Revenue from the SA gold operations decreased by 14% to
R9,680 million (US$786 million) due to a 1% lower average gold price and a 13% decline in gold production year-on-year.
Cost of sales, before amortisation and depreciation
Cost of sales, before amortisation and depreciation increased by 23% to R19,642 million (US$1,596 million). The increase was largely
due to the inclusion of the US PGM operations, which had cost of sales, before amortisation and depreciation of R5,554 million
(US$451 million) for the full six months in H1 2018 compared with R1,572 million (US$119 million) for two months in H1 2017. Cost of sales,
before amortisation and depreciation at the SA PGM operations increased by 4% to R5,716 million (US$464 million) due to above
inflation increases in wages, partly offset by synergies realised. Cost of sales, before amortisation and depreciation at the SA gold
operations decreased by 6% to R8,373 million (US$680 million) due to the cessation of underground operations at Cooke, partly offset
by above inflation increases in wages and other costs related to various operational disruptions during the period.
Amortisation and depreciation
Amortisation and depreciation increased by 24% to R3,095 million (US$251 million). This included R1,025 million (US$83 million) from the
US PGM operations for the full six months in H1 2018 compared with R313 million (US$24 million) for two months in H1 2017. Amortisation
and depreciation at the SA PGM operations increased by 53% to R501 million (US$41 million) as the useful lives of individual assets
were reassessed. The SA gold operations decreased by 16% to R1,569 million (US$128 million) mainly due to the cessation of
underground operations and impairment at Cooke.
Finance expense
The finance expense decreased by 4% to R1,384 million (US$112 million) from R1,440 million (US$109 million). Included in finance
expense in H1 2018 was R749 million interest on borrowings (H1 2017: R1,101 million), R233 million unwinding of the US$450 million
Convertible Bond, US$1.05 Bond and Burnstone Debt (H1 2017: R70 million), R190 million environmental rehabilitation liability accretion
expense (H1 2017: R179 million), R51 million occupational healthcare liability accretion expense, R100 million unwinding of the
Rustenburg Deferred Payment (H1 2017: R74 million) and R62 million sundry interest charges (H1 2017: R15 million).
Interest decreased by R189 million due to the successful refinancing of the Stillwater Bridge Facility through the US$1 billion rights offer,
the US$1.05 billion Bond and the US$450 million Convertible Bond. Sibanye-Stillwater's average outstanding gross debt, excluding the
Burnstone Debt and including the derivative financial instrument, was approximately R26,215 million in H1 2018 compared with
approximately R17,898 million in H1 2017. For additional information on Sibanye-Stillwater's borrowings see note 9 of the financial
statements.
Gain on financial instruments
The net gain on financial instruments of R710 million (US$58 million) for H1 2018 compares with a loss of R261 million (US$20 million) for
H1 2017. This net gain included a fair value gain on the US$450 million Convertible Bond derivative financial instrument of R810 million
(US$66 million), mainly due to the convertible bonds trading well below par, driven by the share price deterioration; and net
unrealised losses on the rand gold forward sale contracts of R91 million (US$7 million).
Net other costs, including care and maintenance
The net other cost for H1 2018 of R372 million (US$30 million) (H1 2017: R198 million (US$15 million)) included additional care and
maintenance costs at the Cooke operations of R273 million (US$22 million) (H1 2017: R114 million (US$9 million)).
Non-recurring items
Impairments
In H1 2018, the Altar and Marathon exploration costs capitalised were impaired as the carrying amounts of the assets exceeded the
recoverable amounts. In the comparative period (H1 2017), the continued losses and outcome of the Section 189 of the Labour
Relations Act 66 of 1995 process at the Cooke Operations and Beatrix West mine, resulted in the impairment of the mining assets by
R2,792 million (Cooke 1, 2 and 3: R2,187 million (US$167 million) and Beatrix West: R604 million (US$47 million)) at 30 June 2017.
Occupational healthcare expense
As a result of the progress made by the Occupational Lung Disease Working Group (the Working Group) since 31 March 2017 on a
variety of issues, management was in a position to reliably estimate, within an acceptable range, the Group's potential share of a
possible settlement of the class action claims and related costs, and provided R1,077 million (US$82 million) before tax for this liability.
On 3 May 2018, the Working Group (representing African Rainbow Minerals, Anglo American SA, AngloGold Ashanti, Gold Fields,
Harmony and Sibanye-Stillwater) agreed to a class action settlement with the claimants of approximately R5 billion. The estimated
costs were reviewed at 30 June 2018, discounted using a risk-free rate, and as a result, a change in estimate of R10.2 million was
recognised in profit or loss.
Transaction costs
Transaction costs of R193 million (US$16 million) for H1 2018 mainly included advisory and legal fees of R83 million (US$7 million) related
to the Lonmin transaction and legal fees of R92 million (US$7 million) related to the Stillwater Mining Company dissenting shareholders
claim. Transaction costs of R402 million (US$30 million) in H1 2017 related to the Stillwater transaction.
Mining and income tax
Current tax increased from R39 million (US$3 million) to R154 million (US$13 million) due to the increase in taxable mining income for
the period. The deferred tax credit decreased from R453 million (US$34 million) to R70 million (US$6 million). The significant deferred
tax credit for H1 2017 was due to the impact of the impairment of Beatrix and the occupational healthcare expense.
The effective tax (expense) rate of 52% for H1 2018 was higher than the South African statutory company tax rate of 28% mainly due
to an increase of deferred tax assets not recognised at the Cooke operations and Burnstone project. The effective tax (credit) rate
of 8% for H1 2017 was lower than the South African statutory company tax rate of 28% mainly due to the tax effect of non-deductible
finance expenses and transaction costs (related to the Stillwater acquisition) and an increase of deferred tax assets not recognised
at the Cooke operations. For additional information on Sibanye-Stillwater's mining and income tax see note 4 of the financial
statements.
Cash flow analysis
Sibanye-Stillwater defines free cash flow as cash from operating activities before dividends paid, less additions to property, plant and
equipment.
A free cash outflow of R732 million (US$59 million) compares with R831 million (US$63 million) for H1 2017. The items contributing to the
decrease in H1 2018 are indicated in the table below.
Figures in million - SA rand
H1 2018 H1 2017
Increase/(decrease) in cash generated by operations(1) 1,715 (3,217)
Decrease in cash-settled share-based payments paid(2) 424 1,059
(Decrease)/increase in investment in working capital(3) (2,075) 1,077
Decrease/(increase) in interest paid 263 (930)
Decrease in royalties and tax paid 319 378
Increase in capital expenditure (i.e. additions to property, plant and equipment)(4) (582) (723)
Other 36 (11)
Decrease/(increase) in free cash outflow 100 (2,367)
(1) The increase in cash generated by operations in H1 2018 was mainly due to the inclusion of the US PGM operations for the full six months in H1 2018 compared with two months in
H1 2017. The decrease in cash generated by operations in H1 2017 was mainly due to the decrease in the average realised gold price to R523,303/kg in H1 2017 from R603,427/kg in
H1 2016.
(2) Approximately 70% of cash-settled share-based payment instruments vested during 2016 resulting in a decrease in cash-settled share-based paid from H1 2017 and the outstanding
instruments vested in H1 2017 resulting in a decrease in cash-settled share-based paid in H1 2018.
(3) The investment in working capital in H1 2018 (of R488 million) was mainly due to the short-term lock-up of mined and recycled material in process and an increase in total in-process
inventory at the US PGM operations, and an increase in gold sales receivables. The release from working capital in H1 2017 (of R1,586 million) was due to a decrease in gold sales
receivables and prepayments, and increase accruals.
(4) The increase in capital expenditure in H1 2018 was largely due to the inclusion of the US PGM operations capital expenditure of US$99 million (R1,218 million) for the full six months in H1
2018 compared with US$25 million (R330 million) for two months in H1 2017, partly offset by deferred capital expenditure at the SA gold and PGM operations. The increase in capital
expenditure in H1 2017 was largely due to the inclusion of the SRPM capital expenditure (of R436 million (US$33 million)) and the US PGM operations capital expenditure for two months
(compared with Rnil (US$nil) in H1 2016).
Cash at 30 June 2018, after net loans raised of R601 million (US$49 million) increased marginally to R2,100 million (US$153 million) from
R2,062 million (US$167 million) at 31 December 2017.
MINERAL RESOURCES AND MINERAL RESERVES
There were no changes to the Mineral Resources and Mineral Reserves from what was previously reported by the Group at
31 December 2017.
CHANGE IN COMPANY SECRETARY
Cain Farrel retired as company secretary with effect form 31 May 2018. Lerato Matlosa was appointed as company secretary on
1 June 2018. Lerato holds a Bachelor of Law (LLB) degree from the National University of Lesotho and is an advocate of the High
Court of Lesotho. She is a qualified Chartered Secretary with the South African Institute of Corporate Secretaries and she also
completed a certificate in Prospecting and Mining Law with the University of Witwatersrand Mandela Institute. Lerato's memberships
include the Chartered Secretaries of South Africa, the Institute of Directors South Africa and a member of the Canadian Society of
Corporate Secretaries. She was previously the Company Secretary of Atlatsa Resources Corporation, a Toronto Stock Exchange and
JSE listed company.
SALIENT FEATURES AND COST BENCHMARKS FOR THE SIX MONTHS ENDED 30 JUNE 2018,
31 DECEMBER 2017 AND 30 JUNE 2017
SA and US PGM operations
SA REGION US REGION
Total SA Total US PGM
and US PGM Total SA PGM Kroondal Mimosa Plat Mile Rustenburg Stillwater
Attributable Under- Under- Under-
Total ground Surface Attributable Attributable Surface ground Surface ground(1)
Production
Tonnes milled/treated 000't Jun 2018 13,084 12,434 5,945 6,489 1,835 698 3,748 3,412 2,741 650
Dec 2017 13,492 12,857 6,257 6,600 1,966 704 3,857 3,587 2,743 635
Jun 2017 13,559 13,339 6,005 7,334 1,812 681 4,193 3,512 3,141 220
Plant head grade g/t Jun 2018 2.66 2.00 3.25 0.84 2.48 3.56 0.60 3.61 1.21 15.35
Dec 2017 2.71 2.10 3.28 0.98 2.45 3.58 0.63 3.69 1.47 15.13
Jun 2017 2.27 2.07 3.31 1.05 2.40 3.58 0.66 3.72 1.57 14.74
Plant recoveries % Jun 2018 77.26 71.77 83.77 28.44 82.35 77.95 10.66 85.28 38.76 91.35
Dec 2017 75.32 69.49 83.78 24.27 81.88 78.12 13.48 85.47 30.77 90.82
Jun 2017 69.07 66.66 83.09 24.23 81.93 77.60 9.99 84.51 32.24 92.00
Yield g/t Jun 2018 2.05 1.42 2.72 0.23 2.04 2.77 0.06 3.08 0.47 14.07
Dec 2017 2.04 1.46 2.75 0.24 2.00 2.80 0.09 3.15 0.45 13.84
Jun 2017 1.57 1.38 2.75 0.25 1.97 2.78 0.07 3.15 0.51 13.24
PGM production(2) 4Eoz - 2Eoz Jun 2018 863,125 569,166 520,268 48,899 120,461 62,270 7,718 337,537 41,181 293,959
Dec 2017 886,267 603,636 553,133 50,503 126,606 63,274 10,545 363,253 39,958 282,631
Jun 2017 684,437 590,712 530,769 59,943 114,619 60,879 8,898 355,271 51,045 93,725
PGM sold 4Eoz - 2Eoz Jun 2018 840,512 569,166 520,268 48,899 120,461 62,270 7,718 337,537 41,181 271,346
Dec 2017 883,738 603,636 553,133 50,503 126,606 63,274 10,545 363,253 39,958 280,102
Jun 2017 665,877 590,712 530,769 59,943 114,619 60,879 8,898 355,271 51,045 75,165
Price and costs(3)
Average PGM basket
price(4) R/4Eoz - R/2Eoz Jun 2018 12,691 12,941 12,965 12,715 13,217 12,733 13,048 12,875 12,652 12,260
Dec 2017 12,940 13,066 13,063 13,095 13,114 13,107 13,195 13,045 13,068 12,699
Jun 2017 11,883 12,006 12,037 11,685 12,030 12,015 12,068 12,039 11,618 11,242
US$/4Eoz - US$/2Eoz Jun 2018 1,031 1,051 1,053 1,033 1,074 1,034 1,060 1,046 1,028 996
Dec 2017 965 975 974 977 978 978 984 973 975 947
Jun 2017 980 910 912 885 911 910 914 912 880 850
Operating cost(5) R/t Jun 2018 731 487 1,003 69 684 837 17 1,175 141 2,716
Dec 2017 640 502 1,010 74 626 838 18 1,221 153 3,287
Jun 2017 469 434 952 58 643 897 14 1,111 116 2,491
US$/t Jun 2018 59 40 82 6 56 68 1 95 11 221
Dec 2017 48 37 75 6 47 63 1 91 11 245
Jun 2017 36 33 72 4 49 68 1 84 9 190
R/4Eoz - R/2Eoz Jun 2018 9,344 11,277 11,497 9,221 10,424 9,377 8,253 11,879 9,402 6,010
Dec 2017 9,948 11,289 11,453 9,704 9,718 9,318 6,676 12,057 10,504 7,383
Jun 2017 9,686 10,365 10,786 7,065 10,169 10,035 6,687 10,985 7,131 5,847
US$/4Eoz - US$/2Eoz Jun 2018 759 916 934 749 847 762 671 965 764 488
Dec 2017 742 842 855 724 725 695 498 899 784 551
Jun 2017 734 785 817 535 770 760 506 832 540 443
Adjusted EBITDA margin(6) % Jun 2018 15 15 36 24 15 25
Dec 2017 16 20 32 41 14 25
Jun 2017 8 9 29 8 7 19
All-in sustaining cost(7) R/4Eoz - R/2Eoz Jun 2018 9,349 10,106 10,187 8,060 8,318 10,116 8,045
Dec 2017 9,905 10,432 10,057 9,223 6,619 10,650 8,899
Jun 2017 10,029 10,364 10,307 8,643 6,799 10,458 8,134
US$/4Eoz - US$/2Eoz Jun 2018 760 821 828 655 676 822 653
Dec 2017 739 778 750 688 494 794 660
Jun 2017 760 785 781 655 515 792 622
All-in cost(7) R/4Eoz - R/2Eoz Jun 2018 10,226 10,173 10,187 8,060 12,646 10,118 10,316
Dec 2017 10,787 10,436 10,057 9,223 6,837 10,650 11,458
Jun 2017 10,312 10,364 10,307 8,643 6,799 10,458 10,014
US$/4Eoz - US$/2Eoz Jun 2018 831 826 828 655 1,027 822 838
Dec 2017 805 779 750 688 510 794 855
Jun 2017 781 785 781 655 515 792 765
Capital expenditure
Total capital Rm Jun 2018 1,622.2 404.2 49.9 65.7 38.2 316.1 1,218.0
expenditure(8) Dec 2017 1,839.0 514.9 111.6 117.9 7.9 395.4 1,324.1
Jun 2017 849.7 520.0 78.9 104.6 5.4 435.7 329.7
US$m Jun 2018 131.7 32.8 4.1 5.3 3.1 25.7 98.9
Dec 2017 137.5 38.3 8.3 8.8 0.6 29.4 99.2
Jun 2017 64.4 39.4 6.0 7.9 0.4 33.0 25.0
Average exchange rate for the six months ended 30 June 2018, 31 December 2017 and 30 June 2017 was R12.31/US$, R13.41/US$ and R13.21/US$, respectively.
Figures may not add as they are rounded independently.
(1) The US PGM operations' results for the six months ended 30 June 2017 are for two months since acquisition. The US PGM operations' underground production is converted to metric
tonnes and kilograms, and performance is translated into SA rand. In addition to the US PGM operations' underground production, the operation treats recycling material which is
excluded from the statistics shown, except for adjusted EBITDA margin and is detailed in the PGM recycling table below.
(2) Production per product - see prill split in the table below.
(3) The Group and total SA PGM operations' unit cost benchmarks exclude the financial results of Mimosa, which is equity accounted and excluded from revenue and cost of sales.
(4) The average PGM basket price is the PGM revenue per 4E/2E ounce, prior to a purchase of concentrate adjustment.
(5) Operating cost is the average cost of production and calculated by dividing costs of sales, before amortisation and depreciationin a period by the tonnes milled/treated in the same
period, and operating cost per ounce (and kilogram) is calculated by dividing the cost of sales, before amortisation and depreciation in a period by the PGM produced in the same
period. The US PGM operatoins
(6) Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by revenue.
(7) All-in costs exclude income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed to normalise
earnings. All-in costs are made up of All-in sustaining costs, being the costs to sustain current operations, given as a sub-total in the All-in costs calculation, together with corporate and major capital
expenditure associated with growth. All-in sustaining cost per ounce (and kilogram) and All-in cost per ounce (and kilogram) are calculated by dividing the All-in sustaining costs and All-in costs,
respectively, in a period by the total 4E/2E PGM produced in the same period. For a reconciliation of cost of sales, before amortisation and depreciation to All-in costs, see "All-in costs for the
six months ended 30 June 2018, 31 December 2017 and 30 June 2017".
The US region All-in-cost, excluding the corporate project expenditure (on the Altar and Marathon projects), for the six months ended 30 June 2018, 31 December 2017 and 30 June
2017 was US$822/2Eoz, US$845/2Eoz and US$765/2Eoz, respectively.
(8) The US region corporate project expenditure for the six months ended 30 June 2018, 31 December 2017 and 30 June 2017 was R58.1 million (US$4.8 million), R30.4 million (US$2.3 million)
and R9.4 million (US$0.7 million), respectively, which related to the Altar and Marathon projects.
Mining - Prill split excluding recycling operations
GROUP SA REGION US REGION
Jun 2018 Jun 2018 Dec 2017 Jun 2017 Jun 2018 Dec 2017 Jun 2017(1)
4Eoz % 4Eoz % 4Eoz % 4Eoz % 2Eoz % 2Eoz % 2Eoz %
Platinum 397,351 46% 331,399 58% 349,906 58% 345,050 58% 65,952 22% 63,978 23% 21,260 23%
Palladium 404,611 47% 176,603 31% 188,784 31% 183,433 31% 228,008 78% 218,653 77% 72,465 77%
Rhodium 44,252 5% 44,252 8% 51,137 8% 49,028 8%
Gold 16,912 2% 16,912 3% 13,809 2% 13,201 2%
PGM production 863,126 100% 569,166 100% 603,636 100% 590,712 100% 293,959 100% 282,631 100% 93,725 100%
Ruthenium 75,429 75,429 79,079 77,132
Iridium 17,218 17,218 18,086 17,916
Total 955,773 661,813 700,801 685,760 293,959 282,631 93,725
Recycling operation
US REGION
Unit Jun 2018 Dec 2017
Average catalyst fed/day Tonne 23.8 23.9
Total processed Tonne 4,308 4,392
Tolled Tonne 672 637
Purchased Tonne 3,636 3,754
PGM fed 3Eoz 360,246 390,703
PGM sold 3Eoz 303,326 283,431
PGM tolled returned 3Eoz 68,256 79,888
SA gold operations
SA REGION
Total SA gold Driefontein Kloof Beatrix Cooke
Under- Under- Under- Under- Under-
Total ground Surface ground Surface ground Surface ground Surface ground Surface
Production
Tonnes milled/treated 000't Jun 2018 9,055 3,144 5,911 950 1,203 957 2,699 1,232 284 5 1,725
Dec 2017 9,165 3,744 5,421 1,070 2,063 1,101 1,875 1,372 304 201 1,179
Jun 2017 9,865 3,831 6,034 1,067 1,842 1,076 1,699 1,365 474 323 2,019
Yield g/t Jun 2018 2.06 5.22 0.37 5.63 0.37 7.08 0.42 3.47 0.37 1.20 0.31
Dec 2017 2.42 5.37 0.39 6.15 0.40 7.26 0.44 3.28 0.29 5.12 0.33
Jun 2017 2.17 5.01 0.37 6.26 0.50 6.35 0.46 3.19 0.30 4.05 0.19
Gold produced kg Jun 2018 18,616 16,405 2,211 5,349 441 6,775 1,130 4,275 105 6 535
Dec 2017 22,216 20,107 2,109 6,585 815 7,990 816 4,502 88 1,030 390
Jun 2017 21,418 19,178 2,240 6,677 927 6,836 790 4,357 144 1,308 379
oz Jun 2018 598,517 527,432 71,085 171,974 14,178 217,821 36,330 137,444 3,376 193 17,201
Dec 2017 714,260 646,454 67,806 211,712 26,203 256,884 26,235 144,743 2,829 33,115 12,539
Jun 2017 688,604 616,586 72,018 214,670 29,804 219,782 25,399 140,081 4,630 42,053 12,185
Gold sold kg Jun 2018 18,616 16,405 2,211 5,349 441 6,775 1,130 4,275 105 6 535
Dec 2017 22,216 20,107 2,109 6,585 815 7,990 816 4,502 88 1,030 390
Jun 2017 21,547 19,296 2,251 6,761 927 6,870 790 4,357 144 1,308 390
oz Jun 2018 598,517 527,432 71,085 171,974 14,178 217,821 36,330 137,444 3,376 193 17,201
Dec 2017 714,260 646,454 67,806 211,712 26,203 256,884 26,235 144,743 2,829 33,115 12,539
Jun 2017 692,752 620,380 72,372 217,371 29,804 220,875 25,399 140,081 4,630 42,053 12,539
Price and costs
Gold price received R/kg Jun 2018 519,994 521,123 521,392 526,370 539,556
Dec 2017 549,064 548,068 549,023 549,237 554,366
Jun 2017 523,303 523,062 523,538 523,150 523,734
US$/oz Jun 2018 1,314 1,317 1,317 1,330 1,363
Dec 2017 1,274 1,272 1,274 1,274 1,286
Jun 2017 1,233 1,232 1,234 1,232 1,234
Operating cost(1) R/t Jun 2018 925 2,330 177 2,876 204 2,773 190 1,571 107 740 151
Dec 2017 977 2,142 173 2,561 173 2,361 184 1,439 78 3,515 177
Jun 2017 900 2,081 150 2,550 194 2,322 181 1,376 162 2,709 82
US$/t Jun 2018 75 189 14 234 17 225 15 128 9 60 12
Dec 2017 73 160 13 191 13 176 14 107 6 262 13
Jun 2017 68 158 11 193 15 176 14 104 12 205 6
R/kg Jun 2018 449,758 446,522 473,768 510,806 555,782 391,720 452,832 452,702 290,476 616,667 486,355
Dec 2017 403,151 398,901 443,670 416,173 439,018 325,369 423,407 438,450 270,455 686,019 534,872
Jun 2017 414,595 415,758 404,643 407,548 384,898 365,550 389,494 431,076 531,944 669,037 436,148
US$/oz Jun 2018 1,136 1,128 1,197 1,291 1,404 990 1,144 1,144 734 1,558 1,229
Dec 2017 935 926 1,029 965 1,018 755 982 1,017 627 1,591 1,241
Jun 2017 977 979 953 960 907 861 917 1,015 1,253 1,576 1,027
Adjusted EBITDA
margin(2) % Jun 2018 10 1 23 14 (84)
Dec 2017 25 23 39 20 (32)
Jun 2017 20 22 29 17 (31)
All-in sustaining cost(3) R/kg Jun 2018 520,488 603,092 464,301 511,712 524,954
Dec 2017 480,010 502,257 420,089 501,438 666,972
Jun 2017 485,441 474,168 442,650 504,110 678,857
US$/oz Jun 2018 1,315 1,524 1,173 1,293 1,326
Dec 2017 1,114 1,165 975 1,163 1,548
Jun 2017 1,143 1,117 1,043 1,187 1,600
All-in cost(3) R/kg Jun 2018 539,337 603,143 473,498 511,781 524,954
Dec 2017 498,474 504,122 429,866 501,939 666,972
Jun 2017 504,845 478,148 450,614 504,155 685,689
US$/oz Jun 2018 1,363 1,524 1,196 1,293 1,326
Dec 2017 1,157 1,170 997 1,165 1,548
Jun 2017 1,189 1,126 1,062 1,188 1,616
Capital expenditure
Total capital
expenditure(4) Rm Jun 2018 1,430.3 503.5 546.0 237.8 -
Dec 2017 1,776.0 621.2 693.6 265.4 -
Jun 2017 1,634.1 534.3 539.9 280.2 73.9
US$m Jun 2018 116.2 40.9 44.4 19.3 -
Dec 2017 132.7 46.4 51.9 19.7 -
Jun 2017 123.6 40.4 40.8 21.2 5.6
Average exchange rate for the six months ended 30 June 2018, 31 December 2017 and 30 June 2017 was R12.31/US$, R13.41/US$ and R13.21/US$, respectively.
Figures may not add as they are rounded independently.
(1) Operating cost is the average cost of production and calculated by dividing costs of sales, before amortisation and depreciation in a period by the tonnes milled/treated in the same
period, and operatings cost per kilogram (and ounce) is calculated by dividing the cost of sales, before amortisation and depreciation in a period by the gold produced in the same
period.
(2) Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by revenue.
(3) All-in costs exclude income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed
to normalise earnings. All-in costs are made up of All-in sustaining costs, being the costs to sustain current operations, given as a sub-total in the All-in costs calculation, together with
corporate and major capital expenditure associated with growth. All-in sustaining cost per kilogram (and ounce) and All-in cost per kilogram (and ounce) are calculated by dividing
the All-in sustaining cost and All-in costs, respectively, in a period by the total gold production in the same period. For a reconciliation of cost of sales, before amortisation and
depreciation to All-in costs, see "All-in costs for the six months ended 30 June 2018, 31 December 2017 and 30 June 2017".
(4) Corporate project expenditure for the six months ended 30 June 2018, 31 December 2017 and 30 June 2017 was R143.0 million (US$11.7 million), R195.8 million (US$14.7 million), and
R205.8 million (US$15.6 million), respectively, the majority of which related to the Burnstone project.
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Condensed consolidated income statement
Figures are in millions unless otherwise stated
US dollar SA rand
Six months ended Six months ended
Reviewed Unaudited Reviewed Reviewed Unaudited Reviewed
Jun 2017 Dec 2017 Jun 2018 Notes Jun 2018 Dec 2017 Jun 2017
1,454.9 1,994.5 1,942.3 Revenue 23,910.0 26,692.4 19,219.2
(1,210.2) (1,530.8) (1,595.6) Cost of sales, before amortisation and depreciation (19,642.4) (20,496.0) (15,986.7)
244.7 463.7 346.7 4,267.6 6,196.4 3,232.5
(189.0) (239.2) (251.4) Amortisation and depreciation (3,094.7) (3,203.0) (2,496.7)
14.7 16.5 15.5 Interest income 191.3 220.7 194.8
(109.0) (114.3) (112.4) Finance expense 2 (1,384.2) (1,532.2) (1,439.6)
(8.8) (8.6) (10.9) Share-based payments (134.7) (115.7) (116.2)
(19.8) (63.9) 57.7 Gain/(loss) on financial instruments 3 710.2 (853.1) (261.3)
25.3 (3.3) 17.1 Gain/(loss) on foreign exchange differences 210.1 (42.2) 334.6
7.4 14.5 16.1 Share of results of equity-accounted investees after tax 7 198.5 193.5 98.1
(15.0) (32.5) (30.2) Net other costs (372.0) (434.6) (198.1)
(9.1) (9.6) (22.6) - Care and maintenance (278.3) (128.7) (120.5)
- Change in estimate of environmental rehabilitation obligation, and right of recovery
(4.2) (14.5) - receivable and payable - (193.6) (55.3)
(1.7) (8.4) (7.6) - Other (93.7) (112.3) (22.3)
2.3 0.8 2.6 Gain on disposal of property, plant and equipment 31.8 10.2 30.5
(211.7) (119.7) (4.8) Impairments (59.6) (1,615.0) (2,796.0)
(81.5) (1.7) (0.8) Occupational healthcare expense 10 (10.2) (29.7) (1,077.2)
(11.2) (43.6) (7.7) Restructuring costs (94.4) (581.8) (148.0)
(30.4) (11.1) (15.7) Transaction costs (193.0) (150.5) (401.6)
(382.0) (142.4) 21.8 Profit/(loss) before royalties and tax 266.7 (1,937.0) (5,044.2)
(13.1) (16.8) (8.4) Royalties (103.7) (225.6) (172.9)
(395.1) (159.2) 13.4 Profit/(loss) before tax 163.0 (2,162.6) (5,217.1)
31.4 190.0 (6.9) Mining and income tax 4 (84.7) 2,532.2 414.4
(2.9) (35.0) (12.5) - Current tax (154.2) (465.3) (38.9)
34.3 225.0 5.6 - Deferred tax 69.5 2,997.5 453.3
(363.7) 30.8 6.5 (Loss)/profit for the period 78.3 369.6 (4,802.7)
(Loss)/profit for the period attributable to:
(363.8) 30.6 6.4 - Owners of Sibanye-Stillwater 76.7 366.3 (4,803.7)
0.1 0.2 0.1 - Non-controlling interests 1.6 3.3 1.0
Earnings per ordinary share (cents)
(23) 1 - Basic earnings per share 5.1 3 16 (298)
(23) 1 - Diluted earnings per share 5.2 3 16 (298)
1,614,151 2,255,316 2,261,753 Weighted average number of shares ('000) 5.1 2,261,753 2,255,316 1,614,151
1,614,151 2,255,316 2,286,698 Diluted weighted average number of shares ('000) 5.2 2,286,698 2,255,316 1,614,151
Headline earnings per ordinary share (cents)
(9) 10 - Headline earnings per share 5.3 4 87 (135)
(9) 10 - Diluted headline earnings per share 5.4 4 87 (135)
13.21 13.41 12.31 Average R/US$ rate
Condensed consolidated statement of other comprehensive income
Figures are in millions unless otherwise stated
US dollar SA rand
Six months ended Six months ended
Reviewed Unaudited Reviewed Reviewed Unaudited Reviewed
Jun 2017 Dec 2017 Jun 2018 Jun 2018 Dec 2017 Jun 2017
(363.7) 30.8 6.5 (Loss)/profit for the period 78.3 369.6 (4,802.7)
Other comprehensive income
56.6 62.0 (100.2) Other comprehensive income, net of tax 1,309.6 (519.7) (107.5)
- - - Foreign currency translation adjustments 1,309.2 (519.1) (113.3)
0.4 - - Mark to market valuation(1) 0.4 (0.6) 5.8
56.2 62.0 (100.2) Currency translation adjustments(1,2) - - -
(307.1) 92.8 (93.7) Total comprehensive income 1,387.9 (150.1) (4,910.2)
Total comprehensive income attributable to:
(307.2) 92.6 (93.8) - Owners of Sibanye-Stillwater 1,386.3 (153.4) (4,911.2)
0.1 0.2 0.1 - Non-controlling interests 1.6 3.3 1.0
13.21 13.41 12.31 Average R/US$ rate
(1) These gains and losses will never be reclassified to profit or loss.
(2) The currency translation adjustments arise on the convenience translation of the SA rand amount to the US dollars.
Condensed consolidated statement of financial position
Figures are in millions unless otherwise stated
US dollar SA rand
Reviewed Audited Reviewed Reviewed Audited Reviewed
Jun 2017 Dec 2017 Jun 2018 Notes Jun 2018 Dec 2017 Jun 2017
5,146.5 5,183.6 4,875.1 Non-current assets 66,933.4 64,067.3 67,216.4
4,163.6 4,162.2 3,875.1 Property, plant and equipment 53,204.7 51,444.6 54,378.2
521.3 517.5 510.7 Goodwill 7,012.2 6,396.0 6,809.9
165.7 181.6 195.5 Equity-accounted investments 7 2,683.7 2,244.1 2,164.0
246.9 282.6 259.5 Environmental rehabilitation obligation funds 3,562.4 3,492.4 3,225.0
34.9 23.0 21.2 Other receivables 290.6 284.0 455.1
14.1 16.7 13.1 Deferred tax assets 179.8 206.2 184.2
1,173.7 971.2 1,030.7 Current assets 14,150.6 12,004.5 15,327.9
226.8 285.3 308.5 Inventories 4,235.2 3,526.5 2,962.0
395.4 501.4 459.9 Trade and other receivables 6,314.8 6,197.6 5,164.5
24.0 2.8 2.6 Other receivables 35.2 35.2 313.2
28.0 14.8 14.3 Tax receivable 195.8 182.8 365.0
- - 92.5 Non-current assets held for sale 8 1,270.0 - -
499.5 166.9 152.9 Cash and cash equivalents 2,099.6 2,062.4 6,523.2
6,320.2 6,154.8 5,905.8 Total assets 81,084.0 76,071.8 82,544.3
1,842.6 1,941.6 1,858.2 Total equity 25,512.8 23,998.2 24,064.5
3,339.4 3,530.3 3,490.4 Non-current liabilities 47,921.7 43,635.8 43,614.8
1,733.3 1,941.1 2,065.4 Borrowings 9 28,358.0 23,992.0 22,636.7
- 88.5 22.7 Derivative financial instrument 9 311.1 1,093.5 -
346.8 378.5 356.8 Environmental rehabilitation obligation 4,898.7 4,678.7 4,529.0
1.3 0.9 0.8 Post-retirement healthcare obligation 11.1 11.3 16.4
75.6 93.2 77.5 Occupational healthcare obligation 10 1,063.5 1,152.5 987.9
22.3 34.2 31.0 Share-based payment obligations 425.0 422.2 291.8
249.0 304.2 291.0 Other payables 11 3,995.7 3,760.4 3,252.0
911.1 689.7 645.2 Deferred tax liabilities 8,858.6 8,525.2 11,901.0
1,138.2 682.9 557.2 Current Liabilities 7,649.5 8,437.8 14,865.0
579.8 134.1 24.3 Borrowings 9 334.3 1,657.5 7,571.8
6.8 0.1 11.0 Occupational healthcare obligation 10 150.6 0.8 89.3
0.7 1.0 2.3 Share-based payment obligations 31.0 12.3 8.9
547.7 541.5 497.8 Trade and other payables 6,834.4 6,690.4 7,153.1
- 3.4 3.1 Other payables 11 41.9 41.9 -
3.2 2.8 18.7 Tax and royalties payable 257.3 34.9 41.9
6,320.2 6,154.8 5,905.8 Total equity and liabilities 81,084.0 76,071.8 82,544.3
13.06 12.36 13.73 Closing R/US$ rate
Condensed co nsolidated statement of changes in equity
Figures are in millions unless otherwise stated
US dollar SA rand
Accum- Non- Non- Accum-
Stated Other ulated controlling Total Total controlling ulated Other Stated
capital reserves loss interests equity equity interests loss reserves capital
2,388.6 375.3 (1,562.2) 1.3 1,203.0 Balance at 31 December 2016 (Audited) 16,469.1 17.7 (8,262.0) 2,978.8 21,734.6
- 56.6 (363.8) 0.1 (307.1) Total comprehensive income for the period (4,910.2) 1.0 (4,803.7) (107.5) -
- - (363.8) 0.1 (363.7) Loss for the period (4,802.7) 1.0 (4,803.7) - -
- 56.6 - 56.6 Other comprehensive income, net of tax (107.5) - - (107.5) -
- - (42.4) - (42.4) Dividends paid (560.2) (2.0) (558.2) - -
- 7.8 - - 7.8 Share-based payments 103.3 - - 103.3 -
981.3 - - - 981.3 Rights issue 12,962.5 - - - 12,962.5
3,369.9 439.7 (1,968.4) 1.4 1,842.6 Balance at 30 June 2017 (Reviewed) 24,064.5 16.7 (13,623.9) 2,974.6 34,697.1
- 62.0 30.6 0.2 92.8 Total comprehensive income for the period (150.1) 3.3 366.3 (519.7) -
- - 30.6 0.2 30.8 Profit for the period 369.6 3.3 366.3 - -
- 62.0 - 62.0 Other comprehensive income, net of tax (519.7) - - (519.7) -
- - - - - Dividends paid (0.2) (0.2) - - -
- 8.5 - - 8.5 Share-based payments 114.1 - - 114.1 -
(2.3) - - - (2.3) Rights issue (transaction costs) (30.1) - - - (30.1)
3,367.6 510.2 (1,937.8) 1.6 1,941.6 Balance at 31 December 2017 (Audited) 23,998.2 19.8 (13,257.6) 2,569.0 34,667.0
- (100.2) 6.4 0.1 (93.7) Total comprehensive income for the period 1,387.9 1.6 76.7 1,309.6 -
- - 6.4 0.1 6.5 Loss for the period 78.3 1.6 76.7 - -
- (100.2) - - (100.2) Other comprehensive income, net of tax 1,309.6 - - 1,309.6 -
- - - - - Dividends paid (0.6) (0.6) - - -
- 10.3 - - 10.3 Share-based payments 127.3 - - 127.3 -
3,367.6 420.3 (1,931.4) 1.7 1,858.2 Balance at 30 June 2018 (Reviewed) 25,512.8 20.8 (13,180.9) 4,005.9 34,667.0
Condensed consolidated statement of cash flows
Figures are in millions unless otherwise stated
US dollar SA rand
Six months ended Six months ended
Reviewed Unaudited Reviewed Reviewed Unaudited Reviewed
Jun 2017 Dec 2017 Jun 2018 Notes Jun 2018 Dec 2017 Jun 2017
Cash flows from operating activities
144.5 388.3 294.4 Cash generated by operations 3,623.9 5,182.4 1,909.1
(32.6) - (0.6) Cash-settled share-based payments paid (7.5) (2.4) (431.2)
120.1 (159.3) (39.7) Change in working capital (488.4) (2,108.7) 1,586.4
232.0 229.0 254.1 3,128.0 3,071.3 3,064.3
3.9 5.0 7.1 Interest received 87.6 66.9 51.8
(83.3) (71.0) (68.0) Interest paid (837.5) (953.7) (1,100.2)
(14.8) (14.3) (5.9) Royalties paid (73.1) (192.1) (195.3)
(12.7) (25.8) 2.4 Tax refund received/(paid) 29.4 (344.2) (167.7)
(42.4) - - Dividends paid (0.6) (0.2) (560.2)
82.7 122.9 189.6 Net cash from operating activities 2,333.8 1,648.0 1,092.7
Cash flows from investing activities
(188.0) (270.1) (249.1) Additions to property, plant and equipment (3,065.9) (3,614.8) (2,484.0)
2.5 2.9 3.3 Proceeds on disposal of property, plant and equipment 40.4 38.3 33.0
(0.2) (8.4) (0.1) Contributions to funds and payments of environmental rehabilitation obligation (1.7) (111.9) (2.6)
(0.5) (0.5) (0.2) Loan advanced to equity-accounted investee (2.3) (6.4) (7.1)
(2,097.0) - - Investment in subsidiaries - - (27,386.4)
137.2 - - Cash acquired on acquisition of subsidiaries - - 1,792.2
272.9 - - Proceeds on disposal of investments - - 3,605.3
(1,873.1) (276.1) (246.1) Net cash used in investing activities (3,029.5) (3,694.8) (24,449.6)
Cash flows from financing activities
4,141.6 1,087.1 650.1 Loans raised 9 8,002.8 14,882.8 54,711.0
(2,926.4) (1,259.9) (601.3) Loans repaid 9 (7,401.9) (17,061.2) (38,658.3)
981.3 (2.3) - Net proceeds from rights issue - (30.1) 12,962.5
2,196.5 (175.1) 48.8 Net cash from financing activities 600.9 (2,208.5) 29,015.2
406.1 (328.3) (7.7) Net (decrease)/increase in cash and cash equivalents (94.8) (4,255.3) 5,658.3
22.7 (4.3) (6.3) Effect of exchange rate fluctuations on cash held 132.0 (205.5) (103.0)
70.7 499.5 166.9 Cash and cash equivalents at beginning of the period 2,062.4 6,523.2 967.9
499.5 166.9 152.9 Cash and cash equivalents at end of the period 2,099.6 2,062.4 6,523.2
13.21 13.41 12.31 Average R/US$ rate
13.06 12.36 13.73 Closing R/US$ rate
Notes to the condensed consolidated interim financial statements
1. Basis of accounting and preparation
The condensed consolidated interim financial statements are prepared in accordance with IAS 34 Interim Financial Reporting, the
South African Institute of Chartered Accountants Financial Reporting Guides as issued by the Accounting Practices Committee and
Financial Pronouncements as issued by Financial Reporting Standards Council and the requirements of the Companies Act of South
Africa. The accounting policies applied in the preparation of these interim financial statements are in terms of International Financial
Reporting Standards (IFRS) and are consistent with those applied in the previous consolidated annual financial statements, except
for the adoption of IFRS 15 Revenue from Contracts with Customers (IFRS 15) and IFRS 9 Financial Instruments (IFRS 9). These two
standards had no significant impact on the Group's measurement and recognition principles:
- In terms of IFRS 15, control is transferred at the same point when risks and rewards previously transferred.
- In terms of IFRS 9, the mark to market valuation recognised in the consolidated statement of other comprehensive income remains
recognised in the consolidated statement of other comprehensive income, but will not be reclassified to profit or loss in future.
The condensed consolidated income statement, and statements of other comprehensive income and cash flows for the six months
ended 31 December 2017 were not reviewed by the Company's auditor and were prepared by subtracting the reviewed
condensed consolidated financial statements for the period ended 30 June 2017 from the audited comprehensive consolidated
financial statements for the year ended 31 December 2017.
The translation of the primary statements into US dollar is based on the average exchange rate for the period for the condensed
consolidated income statement and statements of other comprehensive income and cash flows, and the period-end closing
exchange rate for the statement of financial position. Exchange differences on translation are accounted for in the statement of
other comprehensive income. This information is provided as supplementary information only.
The condensed consolidated financial statements for the six months ended 30 June 2018 have been prepared by Sibanye-Stillwater's
Group financial reporting team headed by Alicia Brink. This process was supervised by the Group's Chief Financial Officer, Charl
Keyter and approved by the Sibanye-Stillwater board of directors.
2. Finance expense
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Notes Jun 2018 Dec 2017 Jun 2017
Interest charge on:
Borrowings - interest (749.2) (990.6) (1,101.3)
- US$600 million revolving credit facility (RCF) (4.9) - -
- US$1.05 billion Bond (427.7) (470.6) (7.5)
- R6.0 billion RCF, R4.5 billion Facilities, and other borrowings (Rand Facilities) (280.6) (280.6) (299.5)
- US$350 million RCF (36.0) (45.4) (39.2)
- Stillwater Bridge Facility - (194.0) (755.1)
Borrowings - unwinding of amortised cost 9 (233.2) (181.8) (70.0)
- US$450 million Convertible Bond (141.2) (80.5) -
- US$1.05 billion Bond (27.5) (29.3) (0.4)
- Burnstone Debt (64.5) (72.0) (69.6)
Environmental rehabilitation obligation (189.5) (177.8) (179.3)
Occupational healthcare obligation 10 (50.6) (46.4) -
Deferred Payment (100.2) (74.1) (74.1)
Dissenting shareholders (42.9) (48.8) (14.1)
Other (18.6) (12.7) (0.8)
Total finance expense (1,384.2) (1,532.2) (1,439.6)
3. Gain/(loss) on financial instruments
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Notes Jun 2018 Dec 2017 Jun 2017
Fair value gain/(loss) on foreign currency hedge 31.6 (25.1) (337.0)
Fair value (loss)/gain on rand gold forward sale contracts(1) (91.2) 17.4 -
Fair value loss on Anglo American Platinum financial assets - (467.5) -
Gain on the revised cash flow of the Burnstone Debt 9 - 74.7 107.0
Fair value gain on derivative financial instrument (US$450 million Convertible Bond) 9 810.1 115.9 -
Fair value adjustment of share-based payment obligations (21.6) (171.3) -
Loss on the revised cash flow of the Deferred Payment (Rustenburg operations acquisition) - (469.1) -
Other (18.7) 71.9 (31.3)
Total gain/(loss) on financial instruments 710.2 (853.1) (261.3)
(1) At the end of 2017 and during 2018, Sibanye-Stillwater began a hedging programme for Sibanye Gold Limited and Rand Uranium Proprietary Limited by entering into commodity
hedging contracts. The contracts comprise gold zero cost collars which establish a minimum (floor) and maximum (cap) gold sales price. At 30 June 2018, the net rand gold forward
sale contracts financial liability was R130.7 million and the realised gains R56.2 million. As hedge accounting is not applied, resulting gains or losses are accounted for as gains or losses
on financial instruments in profit or loss.
4. Mining and income tax
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Jun 2018 Dec 2017 Jun 2017
Tax on profit before tax at maximum South African statutory company tax rate (45.6) 605.5 1,460.8
Non-deductible finance expense - 36.4 (202.2)
Non-deductible impairments (0.5) (1,053.6) (1.3)
Non-deductible transaction costs - (35.1) (119.5)
Tax benefit in respect of prior years 98.0 - -
Net other non-taxable income and non-deductible expenditure 19.7 106.9 (119.3)
Change in estimated deferred tax rate - 2,571.1 -
(Increase)/decrease of deferred tax assets not recognised (156.3) 301.0 (604.1)
Mining and income tax (84.7) 2,532.2 414.4
5. Earnings per share
5.1 Basic earnings per share
Six months ended
Reviewed Unaudited Reviewed
Jun 2018 Dec 2017 Jun 2017
Ordinary shares in issue ('000) 2,265,478 2,168,721 2,125,844
Bonus element of the capitalisation issue ('000) 402 86,749 129,272
Adjustment for weighting of ordinary shares in issue ('000) (4,127) (154) (640,965)
Adjusted weighted average number of shares ('000) 2,261,753 2,255,316 1,614,151
Profit/(loss) attributable to owners of Sibanye-Stillwater (SA rand million) 76.7 366.3 (4,803.7)
Basic earnings per share (EPS) (cents) 3 16 (298)
5.2 Diluted earnings per share
Six months ended
Reviewed Unaudited Reviewed
Jun 2018 Dec 2017 Jun 2017
Weighted average number of shares
Adjusted weighted average number of shares ('000) 2,261,753 2,255,316 1,614,151
Potential ordinary shares ('000) 24,945 - -
Diluted weighted average number of shares ('000) 2,286,698 2,255,316 1,614,151
Diluted basic EPS (cents) 3 16 (298)
5.3 Headline earnings per share
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Jun 2018 Dec 2017 Jun 2017
Profit/(loss) attributable to owners of Sibanye-Stillwater 76.7 366.3 (4,803.7)
Gain on disposal of property, plant and equipment (31.8) (10.2) (30.5)
Impairments 59.6 1,615.0 2,796.0
Taxation effect of re-measurement items (3.5) (13.2) (143.6)
Headline earnings 101.0 1,957.9 (2,181.8)
Headline EPS (cents) 4 87 (135)
5.4 Diluted headline earnings per share
Six months ended
Reviewed Unaudited Reviewed
Jun 2018 Dec 2017 Jun 2017
Diluted headline EPS (cents) 4 87 (135)
6. Dividends
Dividend policy
Sibanye-Stillwater's dividend policy is to return at least 25% to 35% of normalised earnings to shareholders and after due consideration
of future requirements the dividend may be increased beyond these levels. Management, therefore, considers normalised earnings
in determining what value will be distributed to shareholders. Management believes normalised earnings provides useful information
to investors regarding the extent to which results of operations may affect shareholder returns. Normalised earnings is defined as
earnings attributable to the owners of Sibanye-Stillwater excluding gains and losses on financial instruments and foreign exchange
differences, impairments, gain on disposal of property, plant and equipment, occupational healthcare expense, restructuring costs,
transactions costs, share-based payment on BEE transaction, gain on acquisition, other business development costs, share of results
of equity-accounted investees, after tax, and changes in estimated deferred tax rate.
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Jun 2018 Dec 2017 Jun 2017
Profit/(loss) attributable to the owners of Sibanye-Stillwater 76.7 366.3 (4,803.7)
Adjusted for:
(Gain)/loss on financial instruments (710.2) 853.1 261.3
(Gain)/loss on foreign exchange differences (210.1) 42.2 (334.6)
Gain on disposal of property, plant and equipment (31.8) (10.2) (30.5)
Impairments 59.6 1,615.0 2,796.0
Restructuring costs 94.4 581.8 148.0
Occupational healthcare expense 10.2 29.7 1,077.2
Transaction costs 193.0 150.5 401.6
Other 13.3 17.3 35.4
Tax effect of the items adjusted above 182.2 (358.9) (454.5)
Change in estimated deferred tax rate - (2,571.1) -
Share of results of equity-accounted investees after tax (198.5) (193.5) (98.1)
Normalised earnings(1) (521.2) 522.2 (1,001.9)
(1) Normalised earnings is a pro forma performance measure and is not a measure of performance under IFRS, may not be comparable to similarly titled measures of other companies,
and should not be considered in isolation or as alternatives to profit before tax, profit for the year, cash from operating activities or any other measure of financial performance
presented in accordance with IFRS.
7. Equity-accounted investments
Figures in million - SA rand Six months ended
Reviewed Audited Reviewed
Jun 2018 Dec 2017 Jun 2017
Balance at beginning of the period 2,244.1 2,164.0 2,157.4
Share of results of equity-accounted investee after tax 198.5 193.5 98.1
- Mimosa 135.7 89.9 85.1
- Rand Refinery Proprietary Limited 66.5 107.6 16.9
- Other (3.7) (4.0) (3.9)
Net loan advanced to equity-accounted investee 0.6 2.4 4.1
Foreign currency translation 240.5 (115.8) (95.6)
Balance at end of the period 2,683.7 2,244.1 2,164.0
Equity accounted investments consist of:
- Mimosa(1) 2,389.2 2,012.9 2,038.8
- Rand Refinery 264.9 198.4 90.9
- Other equity-accounted investments 29.6 32.8 34.3
Equity-accounted investments 2,683.7 2,244.1 2,164.0
(1) Sibanye-Stillwater has a 50% interest in Mimosa Investments Limited (Mimosa), which owns and operates the Mimosa mine.
8. Non-current assets held for sale
On 29 June 2018, Sibanye-Stillwater announced that it had entered into an arrangement agreement (the Arrangement Agreement)
with Regulus Resources Inc. (Regulus) and a newly formed subsidiary of Regulus, Aldebaran Resources Inc. (Aldebaran), creating a
strategic partnership in order to unlock value at its Altar copper-gold project in San Juan Province, Argentina (Altar Project), currently
held as part of the US region. Under the terms of the arrangement agreement, Stillwater Canada LLC, an indirect, wholly-owned
subsidiary of Sibanye-Stillwater (Stillwater Canada), will enter into an option and joint venture agreement with Aldebaran, whereby
Aldebaran will have the option to earn into a maximum 80% interest in a wholly-owned subsidiary of Stillwater Canada, Peregrine
Metals Ltd. which owns the Altar Project.
The consideration for Aldebaran to acquire up to an 80% interest in the Altar Project, includes:
- an upfront cash payment of US$15 million to Sibanye-Stillwater on closing of the Arrangement Agreement;
- 19.9% of the shares of Aldebaran, subject to proration if the initial financing exceeds US$30 million (up to a maximum of
US$40 million); and
- a commitment from Aldebaran to carry the next US$30 million of spend at the Altar Project over a maximum of five years (inclusive
of 2018 drilling that was conducted between February and May of this year) as an initial earn-in of a 60% interest in the Altar
Project (the Initial Earn-in).
Pursuant to the Arrangement Agreement, Aldebaran may also elect to earn-in an additional 20% interest in the Altar Project by
spending an additional US$25 million over a three-year period following the Initial Earn-in.
The Arrangement Agreement is subject to customary conditions for a transaction of this nature and is expected to complete before
the end of 2018.
Figures in million - SA rand
Reviewed Audited Reviewed
Jun 2018 Dec 2017 Jun 2017
Property, plant and equipment 1,270.0 - -
Non-current assets held for sale 1,270.0 - -
9. Borrowings
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Notes Jun 2018 Dec 2017 Jun 2017
Balance at beginning of the period 25,649.5 30,208.5 8,973.8
Borrowings acquired on acquisition of subsidiary - - 5,937.6
Loans raised 8,002.8 13,586.2 54,711.0
- US$600 million RCF 9.1 1,913.4 - -
- R6.0 billion RCF 360.0 - 800.0
- US$350 million RCF 580.0 538.5 492.9
- Other borrowings 5,149.4 8,413.2 6,308.3
- US$450 million Convertible Bond - 4,634.5 -
- US$1.05 billion Bond - - 13,109.5
- Stillwater Bridge Facility - - 34,000.3
Loans repaid (7,401.9) (17,061.2) (38,658.3)
- US$600 million RCF (285.2) - -
- R6.0 billion RCF - (363.6) -
- US$350 million RCF (1,779.6) (1,198.2) -
- Other borrowings (5,337.1) (7,934.5) (7,057.8)
- Stillwater Bridge Facility - (7,564.9) (25,739.1)
- Stillwater Convertible Debentures - - (5,861.4)
Unwinding of loans recognised at amortised cost 2 233.2 181.8 70.0
Accrued interest 427.7 478.1 -
Accrued interest paid (516.0) (431.5) -
Gain on the revised cash flow of the Burnstone Debt 3 - (74.7) (107.0)
Loss/(gain) on foreign exchange differences and foreign currency translation 2,297.0 (1,237.7) (718.6)
Balance at end of the period 28,692.3 25,649.5 30,208.5
Borrowings consist of:
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Note Jun 2018 Dec 2017 Jun 2017
US$600 million RCF 9.1 1,757.5 - -
R6.0 billion RCF 5,896.4 5,536.4 5,900.0
US$350 million RCF - 1,137.1 1,828.4
US$450 million Convertible Bond 4,939.7 4,357.1 -
US$1.05 billion Bond 14,022.2 12,597.7 13,274.6
Burnstone Debt 1,780.0 1,537.5 1,633.7
Other borrowings 296.5 483.7 5.2
- Other borrowings 291.0 478.7 -
- Franco Nevada liability 1.9 1.7 1.8
- Stillwater Convertible Debentures 3.6 3.3 3.4
Stillwater Bridge Facility - - 7,566.6
Borrowings 28,692.3 25,649.5 30,208.5
Current portion of borrowings (334.3) (1,657.5) (7,571.8)
Non-current borrowings 28,358.0 23,992.0 22,636.7
Derivative financial instrument (US$450 million Convertible Bond)
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Note Jun 2018 Dec 2017 Jun 2017
Balance at the beginning of the period 1,093.5 - -
Gain of financial instruments 3 (810.1) (115.9) -
Loss/(gain) on foreign exchange differences 27.7 (87.2) -
Derivative financial instruments recognised - 1,296.6 -
Balance at the end of the period 311.1 1,093.5 -
9.1 US$600 million revolving credit facility
On 21 May 2018, Sibanye-Stillwater cancelled and refinanced the US$350 million RCF by drawing under the US$600 million RCF. The
purpose of the facility was to refinance the US$350 million RCF, finance ongoing capital expenditure and working capital.
Terms of the US$600 million RCF
Facility: US$600 million
Interest rate: LIBOR
Interest rate margin: 1.85% if net debt to adjusted EBITDA is equal to or less than 2.50x
2.00% if net debt to adjusted EBITDA is greater than 2.50x
Utilisation fees: Where the total outstanding loans under the RCF fall within the range of the percentage of the total loan as set out below, Sibanye-Stillwater shall
pay an utilisation fee equal to the percentage per annum set out opposite such percentage range.
% of the total loans Utilisation fee
Less than or equal to 33 1/3% 0.15%
Greater than 33 1/3% and less than or equal to 66 3/3% 0.30%
Greater than 66 2/3% 0.50%
Term of facility: Three years
Borrowers: Sibanye Gold Limited, Stillwater Mining Company (Stillwater), Kroondal Operations Proprietary Limited (Kroondal Operations) and Sibanye Rustenburg
Platinum Mines Proprietary Limited (SRPM)
Security and/or guarantors: The facility is unsecured and guaranteed by Sibanye Gold Limited, Stillwater, Kroondal Operations and SRPM.
9.2 Capital management
Debt maturity
The following are contractually due, undiscounted cash flows resulting from maturities of financial liabilities, excluding interest
payments:
Figures in million - SA rand
Between
Within one one and Five years
Total year four years and later
30 June 2018
US$600 million RCF 1,757.5 - 1,757.5 -
R6.0 billion RCF 5,896.4 - 5,896.4 -
US$450 million Convertible Bond 6,178.5 - - 6,178.5
US$1.05 billion Bond 14,416.5 - 6,865.0 7,551.5
Burnstone Debt 2,335.5 - 403.8 1,931.7
Other borrowings 296.5 296.5 - -
Net debt to adjusted EBITDA
Figures in million - SA rand
Reviewed Unaudited Reviewed
Jun 2018 Dec 2017 Jun 2017
Borrowings(1) 27,223.4 25,205.5 28,574.8
Cash and cash equivalents(2) 2,066.7 2,029.8 6,481.8
Net debt(3) 25,156.7 23,175.7 22,093.0
Adjusted EBITDA(4) (12 months) 9,851.0 9,045.1 8,052.4
Net debt to adjusted EBITDA (ratio)(5) 2.6 2.6 2.7
(1) Borrowings are only those borrowings that have recourse to Sibanye-Stillwater. Borrowings, therefore, exclude the Burnstone Debt and include the derivative financial instrument.
(2) Cash and cash equivalents exclude cash of Burnstone.
(3) Net debt represents borrowings and bank overdraft less cash and cash equivalents. Borrowings are only those borrowings that have recourse to Sibanye-Stillwater and, therefore,
exclude the Burnstone Debt and include the derivative financial instrument. Net debt excludes cash of Burnstone.
(4) The adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) calculation included is based on the definitions included in the facility agreements for compliance
with the debt covenant formula. Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Adjusted EBITDA is not a measure of performance under IFRS
and should be considered in addition to, and not as a substitute for, other measures of financial performance and liquidity.
(5) Net debt to adjusted EBITDA ratio is defined as net debt as of the end of a reporting period divided by EBITDA of the 12 months ended on the same reporting date.
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Notes Jun 2018 Dec 2017 Jun 2017
Profit/(loss) before royalties and tax 266.7 (1,937.0) (5,044.2)
Adjusted for:
Amortisation and depreciation 3,094.7 3,203.0 2,496.7
Interest income (191.3) (220.7) (194.8)
Finance expense 2 1,384.2 1,532.2 1,439.6
Share-based payments 134.7 115.7 116.2
(Gain)/loss on financial instruments 3 (710.2) 853.1 261.3
(Gain)/loss on foreign exchange differences (210.1) 42.2 (334.6)
Share of results of equity-accounted investees after tax 7 (198.5) (193.5) (98.1)
Change in estimate of environmental rehabilitation obligation, and right of recovery receivable and payable - 193.6 55.3
Gain on disposal of property, plant and equipment (31.8) (10.2) (30.5)
Impairments 59.6 1,615.0 2,796.0
Occupational healthcare expense 10 10.2 29.7 1,077.2
Restructuring costs 94.4 581.8 148.0
Transaction costs 193.0 150.5 401.6
Adjusted EBITDA 3,895.6 5,955.4 3,089.7
10. Occupational healthcare obligation
On 3 May 2018, the Occupational Lung Disease Working Group (the Working Group), including the group, agreed to a class action
settlement with the claimants of approximately R5 billion. The estimated costs were reviewed at 30 June 2018 and discounted using
a risk-free rate. As a result, a change in estimate of R10.2 million was recognised in profit or loss. The ultimate outcome of these matters
remains uncertain, with a possible failure to obtain the requisite court approval for a potential settlement. The provision is
consequently subject to adjustment in the future, depending on the progress of the Working Group discussions, stakeholder
engagements and the ongoing legal proceedings.
Figures in million - SA rand Six months ended
Reviewed Unaudited Reviewed
Note Jun 2018 Dec 2017 Jun 2017
Balance at beginning of the period 1,153.3 1,077.2 -
Interest charge 2 50.6 46.4 -
Charge to profit or loss 10.2 29.7 1,077.2
Balance at end of the period 1,214.1 1,153.3 1,077.2
Current portion of occupational healthcare obligation (150.6) (0.8) (89.3)
Non-current portion of occupational healthcare obligation 1,063.5 1,152.5 987.9
11. Other payables
Figures in million - SA rand
Reviewed Audited Reviewed
Jun 2018 Dec 2017 Jun 2017
Dissenting shareholders(1) 1,450.6 1,349.7 1,378.8
Deferred Payment (Rustenburg operations acquisition) 2,294.8 2,194.7 1,651.5
Other non-current payables 292.2 257.9 221.7
Other payables 4,037.6 3,802.3 3,252.0
Current portion of other payables (41.9) (41.9) -
Non-current other payables 3,995.7 3,760.4 3,252.0
(1) Following the closing of the Stillwater Transaction on 4 May 2017, three Petitions for Appraisal of Stock were filed in the Chancery Court for the State of Delaware. The first action,
captioned Blue Mountain Credit Alternatives Master Fund L.P. et al. vs. Stillwater Mining Company, Case No. 2017-0385-JTL, was filed 19 May 2017 on behalf of holders of a purported
4,219,523 shares of common stock of Stillwater. The second action, captioned Brigade Leveraged Capital Structures Fund Ltd. et al. vs. Stillwater Mining Company, Case No. 2017-0389-
JTL, was filed 22 May 2017 on behalf of holders of a purported 1,200,000 shares of common stock of Stillwater. The third action, captioned Hillary Shane Revocable Trust, et al. vs.
Stillwater Mining Company, Case No. 2017-0400-JTL, was filed 26 May 2017 on behalf of holders of a purported 384,000 shares of common stock of Stillwater (the Shane Petitioners). On
29 August 2017, the three actions were consolidated into a single action, captioned In re Appraisal of Stillwater Mining Company, Case No. 2017-0385-JTL.
On 28 March 2018, Stillwater Mining Company entered into a settlement agreement with the Shane Petitioners, providing for settlement consideration of US$18 per share, plus interest
at a rate of 1.75% per annum, for a total settlement payment of US$7.0 million. The Shane Petitioners filed a motion to voluntarily dismiss their petition on 11 June 2018, which is pending
court approval.
At this point, the total number of shares of Stillwater common stock subject to appraisal is approximately 5,419,523. The appraisal action seeks a determination of the fair value of the
shares of the common stock of Stillwater under Section 262 of the General Corporation Law of the State of Delaware. Petitioners seek a judgment awarding them, among other things,
the fair value of their Stillwater shares plus interest. The current case scheduling order provides for a four-day trial, commencing on 10 December 2018. Fact discovery has concluded,
and the parties are currently engaged in expert discovery. The court's determination as to fair value of the shares is currently unknown. Accordingly, for accounting purposes only, we
have used the merger price of US$18.00 per share in estimating our liability relating to the shares for which appraisal has been demanded, however, fair value may ultimately be
determined by the court to be equal to, or different from, the merger price.
12. Fair value of financial assets and financial liabilities, and risk management
12.1 Measurement of fair value
The fair value of financial instruments is estimated based on ruling market prices, volatilities and interest rates at 30 June 2018. The
following table sets out the Group's significant financial instruments measured at fair value by level within the fair value hierarchy:
Figures in million - SA rand
Reviewed Audited Reviewed
Jun 2018 Dec 2017 Jun 2017
Level 1 Level 2 Level 1 Level 2 Level 1 Level 2
Financial assets measured at fair value
- Environmental rehabilitation obligation funds 3,187.6 374.8 3,117.6 374.8 2,735.1 489.9
- Trade receivables - PGM sales 4,688.4 - 4,512.4 - 3,896.7 -
- Rand gold forward sale contracts - 4.1 - - - -
Financial liabilities measured at fair value
- Derivative financial instrument(1) - 311.1 - 1,093.5 - -
- Rand gold forward sale contracts - 134.8 - - - -
(1) The derivative financial instrument is recognised at fair value and valued using option pricing methodologies based on observable quoted inputs.
12.2 Risk management activities
Liquidity risk: working capital and going concern assessment
For the six months ended 30 June 2018, the Group realised a profit of R78.3 million (30 June 2017: loss of R4,802.7 million). As of 30 June
2018, the Group's current assets exceeded its current liabilities by R6,501.1 million (31 December 2017: R3,566.7 million) and the
Group's total assets exceeded its total liabilities by R25,512.8 million (31 December 2017: R23,998.2 million). For the six months ended
30 June 2018, the Group generated cash from operating activities of R2,322.8 million (30 June 2017: R1,092.7 million).
As gold and PGMs are sold in US dollars, and the majority of the Group's gold operations and a substantial amount of the Group's
PGM operations' costs are denominated in rand, the Group's results and financial position may be impacted if there is a material
change in the value of the rand against the US dollars. Due to the nature of deep level mining, industrial accidents and mining
accidents may result in operational disruptions such as stoppages which could result in increased production costs as well as financial
and regulatory liabilities. Further, Sibanye-Stillwater's operations and profits have been and may be adversely affected by labour
unrests and union activity. These factors may impact the cash generated or utilised by the Group.
On 6 April 2018, Sibanye-Stillwater refinanced and upsized the US$350 million RCF, due to mature on 23 August 2018, to US$600 million
on improved terms in order to provide enhanced liquidity for the enlarged Group. The key terms of the US$600 million RCF with a
syndicate of international banks, led by Bank of America Merrill Lynch International Limited and HSBC Bank Plc, are disclosed in note
9.1. Further terms include:
- An option for Sibanye-Stillwater to increase the facility size by a further US$150 million to US$750 million, through the inclusion of
additional lenders; and
- Lenders have the option to extend the 3 year facility tenor through two further one year extensions on request from Sibanye-
Stillwater.
On 16 July 2018, Sibanye-Stillwater concluded a US$500 million streaming agreement with Wheaton Precious Metals International Inc.
These funds were received on 25 July 2018 and will be applied to settle a portion of the Group's long-term and short-term debt
facilities in a manner still to be determined. The key terms of the streaming transaction are disclosed in note 14.
As of 30 June 2018, the Group had cash of R2,099.6 million and committed unutilised debt facilities of R7,491 million. The pro forma
cash, if the Group received the funds in terms of the streaming agreement on 30 June 2018, is R8,964.6 million. Although this surplus
liquidity will be reduced once the streaming transaction funds are applied to settle a portion of the Group's long-term and short-
term debt facilities, the Group will maintain higher than normal liquidity levels until the Lonmin acquisition is completed.
Sibanye-Stillwater's leverage ratio (or net debt to adjusted EBITDA) at 30 June 2018 is 2.6. The pro forma leverage ratio, if the Group
received the funds in terms of the streaming agreement on 30 June 2018, is 1.9. The RCFs permit a leverage ratio of 3.5:1 through to
31 December 2018, and 2.5:1 thereafter, calculated on a quarterly basis. Consistent with its long-term strategy, Sibanye-Stillwater
plans to deleverage over time to its targeted leverage ratio of no greater than 1.0:1.
The directors believe that the cash generated by its operations, cash on hand, the committed unutilised debt facilities as well as the
additional funding possibilities will enable the Group to continue to meet its obligations as they fall due. The condensed consolidated
interim financial statements for the six months ended 30 June 2018, therefore, have been prepared on a going concern basis.
13. Contingent liabilities
Purported Class Action Lawsuits
Two purported class action lawsuits have been filed against Sibanye Gold Limited (Sibanye), Neal Froneman and Charl Keyter in the
United States District Court for the Eastern District of New York, alleging violations of the US securities laws. The first lawsuit, Case No.
18-cv-03721, was filed on 27 June 2018 by Kevin Brandel, individually and on behalf of all other persons who purchased Sibanye
securities between 7 April 2017 and 26 June 2018, inclusive (the Class Period). The second lawsuit, Case No. 18-cv-03902, was filed on
6 July 2018 by Lester Heuschen, Jr., also individually and on behalf of members of the Class Period (collectively, the Class Actions).
The Class Actions allege that certain statements by Sibanye in its annual reports filed with the US Securities and Exchange Commission
were false and/or misleading. Specifically, the Class Actions allege that Sibanye made false and/or misleading statements about its
safety practices and record and thereby violated the US securities laws. The Class Actions seek an unspecific amount of damages.
As the cases are in the early stages, it is not possible to determine the likelihood of success on the merits or any potential liability from
the Class Actions nor estimate the duration of the litigation. Sibanye intends to defend the cases vigorously.
14. Events after the reporting period
There were no events that could have a material impact on the financial results of the Group after 30 June 2018, other than those
discussed below.
DRDGOLD acquisition
On 22 November 2017, Sibanye-Stillwater announced that it has entered into various agreements with DRDGOLD Limited (DRDGOLD)
in terms of which, Sibanye-Stillwater will exchange selected surface gold processing assets and tailings storage facilities (TSF) for
c.265 million newly issued DRDGOLD shares (the DRDGOLD Transaction), or 38% of the issued share capital of DRDGOLD. In addition,
pursuant to the DRDGOLD Transaction, Sibanye-Stillwater has an option to subscribe for a sufficient number of DRDGOLD ordinary
shares to attain a 50.1% shareholding in DRDGOLD at a 10% discount to the 30 day volume weighted average traded price.
Sibanye-Stillwater has received approval for the DRDGOLD Transaction from the South African competition authorities in accordance
with the Competition Act. The DRDGOLD Transaction was completed on 31 July 2018. Sibanye-Stillwater obtained control (38%) of
and will consolidated DRDGOLD from this date.
An update of the required business combination disclosures will be provided in Sibanye-Stillwater's preliminary report for the six
months and year ending 31 December 2018.
Carrying value of assets and liabilities of DRDGOLD at 31 December 2017
The following table summarises the carrying value of assets and liabilities of DRDGOLD at 31 December 2017 and is provided for
information purpose only. The assets and liabilities have been extracted from the unaudited interim financial statements as of
31 December 2017.
Figures in million - SA rand
Property, plant and equipment 1,502.0
Environmental rehabilitation obligation funds 235.6
Other non-current assets 16.3
Inventories 242.7
Trade and other receivables 88.4
Cash and cash equivalents 294.6
Environmental rehabilitation obligation (546.5)
Deferred tax liabilities (154.2)
Other non-current liabilities (41.9)
Trade and other payables (275.8)
Other current liabilities (16.8)
Total identifiable net assets acquired 1,344.4
Acquisition related costs
The Group incurred acquisition related costs of R2.7 million on advisory and legal fees. These costs are recognised as transaction
costs in profit or loss.
Lonmin transaction
On 14 December 2017, Sibanye-Stillwater announced that it had reached agreement with Lonmin Plc (Lonmin) on the terms of a
recommended all-share offer to acquire the entire issued and to be issued ordinary share capital of Lonmin (the Lonmin Acquisition).
It is proposed that the Lonmin Acquisition will be effected by means of a scheme of arrangement between Lonmin and the Lonmin
Shareholders under Part 26 of the UK Companies Act. Under the terms of the Lonmin Acquisition, each Lonmin Shareholder will be
entitled to receive: 0.967 new Sibanye-Stillwater shares for each Lonmin share.
On 15 May 2018, Sibanye-Stillwater received South African Reserve Bank approval for the proposed acquisition of Lonmin and on
28 June 2018, the proposed Lonmin transaction was unconditionally cleared by the UK Competition and Markets Authority. The
Lonmin Acquisition is subject to the fulfilment of conditions precedent and is expected to complete during the second half of 2018.
Streaming transaction
Sibanye-Stillwater has secured a US$500 million upfront cash payment (the Advance Amount) through a streaming agreement with
Wheaton Precious Metals International Ltd (Wheaton International), a wholly-owned subsidiary of Wheaton Precious Metals Corp. In
return, Sibanye-Stillwater has committed to deliver a percentage of gold and palladium produced from its US PGM operations
(comprising its East Boulder and Stillwater mining operations) (the Streaming Transaction). The Streaming Transaction is effective from
1 July 2018.
Wheaton International advanced an upfront cash payment of US$500 million to Sibanye-Stillwater on closing of the transaction.
In addition to the Advance Amount, Wheaton International will pay Sibanye-Stillwater 18% of the spot palladium and gold prices for
each ounce delivered under the streaming agreement until the Advance Amount has been reduced to nil through metal deliveries.
Thereafter, Sibanye-Stillwater will receive 22% of spot US dollar palladium and gold prices for each ounce of palladium and gold
delivered. Sibanye-Stillwater has committed to deliver to Wheaton International the equivalent of:
- 100% of gold production from the US PGM operations over the life of the US PGM operations
- Annual palladium production from the US PGM operations equivalent to:
- 4.5% of production, until the later of (i) a cumulative amount of 375koz having been delivered, and (ii) the portion of the
Advance Amount which is attributable to palladium deliveries (i.e. US$253 million) having been reduced to nil through such
deliveries;
- thereafter, the equivalent of 2.25% of production, until the later of (i) a further 175koz having been delivered (or cumulatively
550koz having been delivered), and (ii) the Advance Amount having been reduced to nil through metal deliveries; and
- thereafter and continuing for the life of the operations, 1.0% of palladium production.
15. Review report of the independent auditor
These condensed consolidated interim financial statements for the six months ended 30 June 2018, have been reviewed by the
Company's auditor, KPMG Inc., who expressed an unmodified review conclusion.
The auditor's report does not necessarily report on all of the information contained in these financial results. Shareholders are
therefore advised that in order to obtain a full understanding of the nature of the auditor's engagement they should obtain a copy
of the auditor's report together with the accompanying financial information from the Company's registered office.
Segment reporting
Figures in million
For the six months ended 30 Jun 2018 (Reviewed)
GROUP SA REGION US REGION
Total SA Total SA Drie- Cor- Total SA Platinum Rusten- Cor-
SA rand Total Region gold fontein Kloof Beatrix Cooke porate PGM Kroondal Mile Mimosa burg porate Stillwater
Revenue 23,910.0 16,468.9 9,680.2 3,017.4 4,121.6 2,305.5 291.9 (56.2) 6,788.7 1,499.1 84.5 916.7 5,205.1 (916.7) 7,441.1
Underground 18,285.0 14,753.5 8,521.1 2,787.7 3,534.5 2,251.2 3.9 (56.2) 6,232.4 1,499.1 - 916.7 4,733.3 (916.7) 3,531.5
Surface 1,715.4 1,715.4 1,159.1 229.7 587.1 54.3 288.0 - 556.3 - 84.5 - 471.8 - -
Recycling 3,909.6 - - - - - - - - - - - - - 3,909.6
Cost of sales, before
amortisation and
depreciation (19,642.4) (14,088.8) (8,372.7) (2,977.4) (3,165.6) (1,965.8) (263.9) - (5,716.1) (1,255.7) (63.7) (583.9) (4,396.7) 583.9 (5,553.6)
Underground (14,357.1) (12,590.4) (7,325.2) (2,732.3) (2,653.9) (1,935.3) (3.7) - (5,265.2) (1,255.7) - (583.9) (4,009.5) 583.9 (1,766.7)
Surface (1,498.4) (1,498.4) (1,047.5) (245.1) (511.7) (30.5) (260.2) - (450.9) - (63.7) - (387.2) - -
Recycling (3,786.9) - - - - - - - - - - - - - (3,786.9)
Net other cash costs (372.0) (371.9) (300.4) (23.9) (20.1) (10.0) (274.0) 27.6 (71.5) (21.0) (0.5) (6.7) (49.7) 6.4 (0.1)
Adjusted EBITDA 3,895.6 2,008.2 1,007.1 16.1 935.9 329.7 (246.0) (28.6) 1,001.1 222.4 20.3 326.1 758.7 (326.4) 1,887.4
Amortisation and
depreciation (3,094.7) (2,069.9) (1,568.5) (586.8) (659.8) (304.8) (3.0) (14.1) (501.4) (180.2) (1.3) (90.5) (318.0) 88.6 (1,024.8)
Interest income 191.3 154.0 117.4 45.5 32.1 13.5 16.2 10.1 36.6 27.1 1.3 0.1 7.5 0.6 37.3
Finance expense (1,384.2) (598.2) (387.2) (117.8) (123.1) (70.6) (37.1) (38.6) (211.0) (63.0) - (4.8) (148.0) 4.8 (786.0)
Share-based payments (134.7) (118.1) (118.1) (0.2) - - - (117.9) - - - - - - (16.6)
Net other 1,118.8 1,048.8 962.5 (36.4) (35.6) (16.9) (35.8) 1,087.2 86.3 27.7 - (1.7) (55.8) 116.1 70.0
Non-underlying items (325.4) (147.9) (127.4) 1.9 11.9 3.6 (33.7) (111.1) (20.5) 0.2 - - (21.3) 0.6 (177.5)
Royalties (103.7) (103.7) (82.8) (15.1) (48.4) (17.9) (1.5) 0.1 (20.9) (2.4) - (28.9) (18.5) 28.9 -
Current taxation (154.2) (154.4) (126.6) 63.9 25.9 3.9 0.8 (221.1) (27.8) - - (53.5) (27.5) 53.2 0.2
Deferred taxation 69.5 26.3 103.8 186.6 21.7 17.6 - (122.1) (77.5) (20.4) (5.1) (11.1) (52.5) 11.6 43.2
Profit for the period 78.3 45.1 (219.8) (442.3) 160.6 (41.9) (340.1) 443.9 264.9 11.4 15.2 135.7 124.6 (22.0) 33.2
Attributable to:
Owners of Sibanye-
Stillwater 76.7 43.5 (220.1) (442.3) 160.6 (41.9) (340.1) 443.6 263.6 11.4 13.9 135.7 124.6 (22.0) 33.2
Non-controlling interests 1.6 1.6 0.3 - - - - 0.3 1.3 - 1.3 - - - -
Sustaining capital
expenditure (438.6) (327.9) (184.4) (84.1) (75.4) (24.2) - (0.7) (143.5) (49.9) (4.8) (65.7) (88.8) 65.7 (110.7)
Ore reserve
development (1,696.6) (1,257.0) (1,030.3) (419.1) (397.9) (213.3) - - (226.7) - - - (226.7) - (439.6)
Growth projects (917.3) (249.6) (215.6) (0.3) (72.7) (0.3) - (142.3) (34.0) - (33.4) - (0.6) - (667.7)
Total capital
expenditure (3,052.5) (1,834.5) (1,430.3) (503.5) (546.0) (237.8) - (143.0) (404.2) (49.9) (38.2) (65.7) (316.1) 65.7 (1,218.0)
For the six months ended 30 Jun 2018 (Reviewed)
GROUP SA REGION US REGION
Total SA Total SA Drie- Cor- Total SA Platinum Rusten- Cor-
US dollars(1) Total Region gold fontein Kloof Beatrix Cooke porate PGM Kroondal Mile Mimosa burg porate Stillwater
Revenue 1,942.3 1,337.8 786.3 245.2 334.8 187.3 23.7 (4.7) 551.5 121.8 6.9 74.5 422.8 (74.5) 604.5
Underground 1,485.3 1,198.4 692.1 226.5 287.1 182.9 0.3 (4.7) 506.3 121.8 - 74.5 384.5 (74.5) 286.9
Surface 139.4 139.4 94.2 18.7 47.7 4.4 23.4 - 45.2 - 6.9 - 38.3 - -
Recycling 317.6 - - - - - - - - - - - - - 317.6
Cost of sales, before
amortisation and
depreciation (1,595.6) (1,144.5) (680.1) (241.8) (257.2) (159.7) (21.4) - (464.4) (102.0) (5.2) (47.4) (357.2) 47.4 (451.1)
Underground (1,166.2) (1,022.7) (595.0) (221.9) (215.6) (157.2) (0.3) - (427.7) (102.0) - (47.4) (325.7) 47.4 (143.5)
Surface (121.8) (121.8) (85.1) (19.9) (41.6) (2.5) (21.1) - (36.7) - (5.2) - (31.5) - -
Recycling (307.6) - - - - - - - - - - - - - (307.6)
Net other cash costs (30.3) (30.2) (24.4) (2.1) (1.6) (0.8) (22.3) 2.4 (5.8) (1.7) (0.1) (0.6) (4.0) 0.6 (0.1)
Adjusted EBITDA 316.4 163.1 81.8 1.3 76.0 26.8 (20.0) (2.3) 81.3 18.1 1.6 26.5 61.6 (26.5) 153.3
Amortisation and
depreciation (251.4) (168.2) (127.5) (47.7) (53.6) (24.8) (0.2) (1.2) (40.7) (14.6) (0.1) (7.4) (25.8) 7.2 (83.2)
Interest income 15.5 12.5 9.6 3.7 2.6 1.1 1.3 0.9 2.9 2.2 0.1 - 0.6 - 3.0
Finance expense (112.4) (48.5) (31.4) (9.6) (10.0) (5.7) (3.0) (3.1) (17.1) (5.1) - (0.4) (12.0) 0.4 (63.9)
Share-based payments (10.9) (9.6) (9.6) - - - - (9.6) - - - - - - (1.3)
Net other 91.0 85.3 78.2 (3.0) (2.9) (1.4) (2.9) 88.4 7.1 2.3 - (0.1) (4.5) 9.4 5.7
Non-underlying items (26.4) (12.0) (10.3) 0.2 1.0 0.3 (2.7) (9.1) (1.7) - - - (1.7) - (14.4)
Royalties (8.4) (8.4) (6.7) (1.2) (3.9) (1.5) (0.1) - (1.7) (0.2) - (2.3) (1.5) 2.3 -
Current taxation (12.5) (12.5) (10.3) 5.2 2.1 0.3 0.1 (18.0) (2.2) - - (4.3) (2.2) 4.3 -
Deferred taxation 5.6 2.1 8.5 15.2 1.8 1.4 - (9.9) (6.4) (1.7) (0.4) (0.9) (4.3) 0.9 3.5
Profit for the period 6.5 3.8 (17.7) (35.9) 13.1 (3.5) (27.5) 36.1 21.5 1.0 1.2 11.1 10.2 (2.0) 2.7
Attributable to: - - - -
Owners of Sibanye-
Stillwater 6.4 3.7 (17.7) (35.9) 13.1 (3.5) (27.5) 36.1 21.4 1.0 1.1 11.1 10.2 (2.0) 2.7
Non-controlling interests 0.1 0.1 - - - - - - 0.1 - 0.1 - - - -
Sustaining capital
expenditure (35.7) (26.7) (15.0) (6.8) (6.1) (2.0) - (0.1) (11.7) (4.1) (0.4) (5.3) (7.2) 5.3 (9.0)
Ore reserve
development (137.9) (102.2) (83.8) (34.1) (32.4) (17.3) - - (18.4) - - - (18.4) - (35.7)
Growth projects (74.4) (20.2) (17.5) - (5.9) - - (11.6) (2.7) - (2.7) - - - (54.2)
Total capital
expenditure (248.0) (149.1) (116.3) (40.9) (44.4) (19.3) - (11.7) (32.8) (4.1) (3.1) (5.3) (25.6) 5.3 (98.9)
(1) The average exchange rate for the six months ended 30 June 2018 was R12.31/US$.
Figures are in millions
For the six months ended 31 Dec 2017 (Unaudited)
GROUP SA REGION US REGION
Total SA Total SA Drie- Cor- Total SA Platinum Rusten- Cor-
SA rand Total Region gold fontein Kloof Beatrix Cooke porate PGM Kroondal Mile Mimosa burg porate Stillwater
Revenue 26,692.4 19,477.2 12,197.9 4,055.6 4,834.8 2,521.1 787.1 (0.7) 7,279.3 1,557.5 110.0 881.8 5,611.8 (881.8) 7,215.2
Underground 21,464.9 17,728.0 11,042.9 3,610.7 4,388.2 2,473.3 571.4 (0.7) 6,685.1 1,557.5 - 881.8 5,127.6 (881.8) 3,736.9
Surface 1,749.2 1,749.2 1,155.0 444.9 446.6 47.8 215.7 - 594.2 - 110.0 - 484.2 - -
Recycling 3,478.3 - - - - - - - - - - - - - 3,478.3
Cost of sales, before
amortisation and
depreciation (20,496.0) (15,056.7) (8,956.5) (3,098.4) (2,945.2) (1,997.7) (915.2) - (6,100.2) (1,230.3) (70.3) (589.6) (4,799.6) 589.6 (5,439.3)
Underground (15,717.7) (13,630.9) (8,020.7) (2,740.6) (2,599.7) (1,973.9) (706.5) - (5,610.2) (1,230.3) - (589.6) (4,379.9) 589.6 (2,086.8)
Surface (1,425.8) (1,425.8) (935.8) (357.8) (345.5) (23.8) (208.7) - (490.0) - (70.3) - (419.7) - -
Recycling (3,352.5) - - - - - - - - - - - - - (3,352.5)
Net other cash costs (241.0) (239.6) (188.9) (15.1) (21.5) (7.9) (125.9) (18.5) (50.7) (19.1) 4.9 (7.2) (36.2) 6.9 (1.4)
Adjusted EBITDA 5,955.4 4,180.9 3,052.5 942.1 1,868.1 515.5 (254.0) (19.2) 1,128.4 308.1 44.6 285.0 776.0 (285.3) 1,774.5
Amortisation and
depreciation (3,203.0) (2,084.6) (1,651.0) (594.5) (728.4) (301.7) (14.6) (11.8) (433.6) (124.4) (1.2) (113.9) (286.1) 92.0 (1,118.4)
Interest income 220.7 184.0 96.9 42.4 42.9 4.8 (7.5) 14.3 87.1 33.7 0.7 0.1 51.8 0.8 36.7
Finance expense (1,532.2) (250.8) (73.5) (106.6) (121.1) (61.5) (37.3) 253.0 (177.3) (51.2) - (4.8) (126.2) 4.9 (1,281.4)
Share-based payments (115.7) (112.5) (112.5) (0.3) - - - (112.2) - - - - - - (3.2)
Net other (1,136.4) (1,110.7) 53.8 7.6 0.3 (11.7) (149.3) 206.9 (1,164.5) (195.6) 5.4 (13.1) (929.4) (31.8) (25.7)
Non-underlying items (2,366.8) (2,300.2) (2,233.1) (70.8) (47.0) (68.5) (1,467.9) (578.9) (67.1) (1.0) - - (62.1) (4.0) (66.6)
Royalties (225.6) (225.6) (184.5) (31.1) (119.8) (24.4) (9.2) - (41.1) (3.1) - (26.3) (38.0) 26.3 -
Current taxation (465.3) (341.4) (322.4) (9.4) (260.9) (11.1) - (41.0) (19.0) - (8.8) (43.2) (10.0) 43.0 (123.9)
Deferred taxation 2,997.5 95.1 90.5 (5.8) 24.2 54.5 - 17.6 4.6 3.3 (7.1) (1.1) 2.3 7.2 2,902.4
Profit for the period 369.6 (1,726.2) (1,094.4) 188.7 679.8 103.8 (1,813.9) (252.8) (631.8) (11.1) 28.7 89.9 (585.5) (153.8) 2,095.8
Attributable to: `
Owners of Sibanye-
Stillwater 366.3 (1,729.5) (1,095.3) 188.7 679.8 103.8 (1,813.9) (253.7) (634.2) (11.1) 26.3 89.9 (585.5) (153.8) 2,095.8
Non-controlling interests 3.3 3.3 0.9 - - - - 0.9 2.4 - 2.4 - - - -
Sustaining capital
expenditure (816.6) (636.4) (355.2) (150.6) (158.4) (36.5) - (9.7) (281.2) (111.6) (5.6) (117.9) (164.0) 117.9 (180.2)
Ore reserve
development (1,789.9) (1,365.8) (1,134.4) (456.7) (449.1) (228.6) - - (231.4) - - - (231.4) - (424.1)
Growth projects (1,008.5) (288.7) (286.4) (13.9) (86.1) (0.3) - (186.1) (2.3) - (2.3) - - - (719.8)
Total capital
expenditure (3,615.0) (2,290.9) (1,776.0) (621.2) (693.6) (265.4) - (195.8) (514.9) (111.6) (7.9) (117.9) (395.4) 117.9 (1,324.1)
For the six months ended 31 Dec 2017 (Unaudited)
GROUP SA REGION US REGION
Total SA Total SA Drie- Cor- Total SA Platinum Rusten- Cor-
US dollars(1) Total Region gold fontein Kloof Beatrix Cooke porate PGM Kroondal Mile Mimosa burg porate Stillwater
Revenue 1,994.5 1,453.5 909.9 302.4 360.9 188.0 58.7 (0.1) 543.6 116.3 8.2 65.8 419.1 (65.8) 541.0
Underground 1,603.4 1,323.1 823.8 269.2 327.6 184.5 42.6 (0.1) 499.3 116.3 - 65.8 383.0 (65.8) 280.3
Surface 130.4 130.4 86.1 33.2 33.3 3.5 16.1 - 44.3 - 8.2 - 36.1 - -
Recycling 260.7 - - - - - - - - - - - - - 260.7
Cost of sales, before
amortisation and
depreciation 1,530.8) (1,123.0) (667.8) (231.1) (219.7) (148.9) (68.1) - (455.2) (91.8) (5.3) (44.0) (358.2) 44.1 (407.8)
Underground 1,173.1) (1,016.6) (598.0) (204.4) (193.9) (147.2) (52.5) - (418.6) (91.8) - (44.0) (326.9) 44.1 (156.5)
Surface (106.4) (106.4) (69.8) (26.7) (25.8) (1.7) (15.6) - (36.6) - (5.3) - (31.3) - -
Recycling (251.3) - - - - - - - - - - - - - (251.3)
Net other cash costs (18.0) (17.9) (14.1) (1.0) (1.6) (0.6) (9.5) (1.4) (3.8) (1.4) 0.5 (0.5) (2.8) 0.4 (0.1)
Adjusted EBITDA 445.7 312.6 228.0 70.3 139.6 38.5 (18.9) (1.5) 84.6 23.1 3.4 21.3 58.1 (21.3) 133.1
Amortisation and
depreciation (239.2) (155.4) (122.9) (44.3) (54.3) (22.4) (1.0) (0.9) (32.5) (9.3) (0.1) (8.5) (21.4) 6.8 (83.8)
Interest income 16.5 13.7 7.1 3.1 3.2 0.4 (0.6) 1.0 6.6 2.5 0.1 - 3.9 0.1 2.8
Finance expense (114.3) (18.2) (5.0) (7.9) (9.0) (4.5) (2.9) 19.3 (13.2) (3.8) - (0.4) (9.4) 0.4 (96.1)
Share-based payments (8.6) (8.3) (8.3) - - - - (8.3) - - - - - - (0.3)
Net other (85.2) (83.2) 4.0 0.6 (0.1) (0.8) (11.3) 15.6 (87.2) (14.7) 0.5 (0.9) (69.6) (2.5) (2.0)
Non-underlying items (175.3) (170.3) (165.3) (5.3) (3.5) (4.8) (109.0) (42.7) (5.0) (0.1) - - (4.6) (0.3) (5.0)
Royalties (16.8) (16.8) (13.6) (2.3) (8.9) (1.8) (0.6) - (3.2) (0.2) - (1.9) (3.0) 1.9 -
Current taxation (35.0) (25.7) (24.1) (0.7) (19.5) (0.8) - (3.1) (1.6) - (0.7) (3.3) (0.8) 3.2 (9.3)
Deferred taxation 225.0 6.9 6.5 (0.4) 1.8 3.9 - 1.2 0.4 0.2 (0.5) (0.1) 0.2 0.6 218.1
Profit for the period 30.8 (126.8) (79.5) 14.1 50.9 8.3 (134.8) (18.0) (47.3) (0.9) 2.2 6.7 (43.8) (11.5) 157.6
Attributable to: -
Owners of Sibanye-
Stillwater 30.6 (127.0) (79.6) 14.1 50.9 8.3 (134.8) (18.1) (47.4) (0.9) 2.1 6.7 (43.8) (11.5) 157.6
Non-controlling interests 0.2 0.2 0.1 - - - - 0.1 0.1 - 0.1 - - - -
Sustaining capital
expenditure (61.1) (47.6) (26.7) (11.3) (11.9) (2.7) - (0.8) (20.9) (8.3) (0.4) (8.8) (12.2) 8.8 (13.5)
Ore reserve
development (133.6) (101.8) (84.6) (34.1) (33.5) (17.0) - - (17.2) - - - (17.2) - (31.8)
Growth projects (75.5) (21.6) (21.4) (1.0) (6.5) - - (13.9) (0.2) - (0.2) - - - (53.9)
Total capital
expenditure (270.2) (171.0) (132.7) (46.4) (51.9) (19.7) - (14.7) (38.3) (8.3) (0.6) (8.8) (29.4) 8.8 (99.2)
(1) The average exchange rate for the six months ended 31 December 2017 was R13.41/US$.
For the six months ended 30 Jun 2017 (Reviewed)
GROUP SA REGION US REGION(1)
Total SA Total SA Drie- Cor- Total SA Platinum Rusten- Cor-
SA rand Total Region gold fontein Kloof Beatrix Cooke porate PGM Kroondal Mile Mimosa burg porate Stillwater
Revenue 19,219.2 17,272.8 11,275.7 4,021.3 4,010.3 2,354.7 889.4 - 5,997.1 1,304.0 84.1 805.9 4,609.0 (805.9) 1,946.4
Underground 16,325.4 15,440.0 10,100.3 3,537.4 3,597.1 2,279.8 686.0 - 5,339.7 1,304.0 - 805.9 4,035.7 (805.9) 885.4
Surface 1,832.8 1,832.8 1,175.4 483.9 413.2 74.9 203.4 - 657.4 - 84.1 - 573.3 - -
Recycling 1,061.0 - - - - - - - - - - - - - 1,061.0
Cost of sales, before
amortisation and
depreciation (15,986.7) (14,414.3) (8,922.7) (3,105.1) (2,817.5) (1,954.8) (1,045.3) - (5,491.6) (1,165.6) (59.5) (610.9) (4,266.5) 610.9 (1,572.4)
Underground (13,627.6) (13,079.6) (8,011.5) (2,748.3) (2,509.8) (1,878.2) (875.2) - (5,068.1) (1,165.6) - (610.9) (3,902.5) 610.9 (548.0)
Surface (1,334.7) (1,334.7) (911.2) (356.8) (307.7) (76.6) (170.1) - (423.5) - (59.5) - (364.0) - -
Recycling (1,024.4) - - - - - - - - - - - - - (1,024.4)
Net other cash costs (142.8) (136.9) (97.0) (17.3) (16.4) (5.4) (117.5) 59.6 (39.9) (15.6) (17.5) 41.4 (5.6) (42.6) (5.9)
Adjusted EBITDA 3,089.7 2,721.6 2,256.0 898.9 1,176.4 394.5 (273.4) 59.6 465.6 122.8 7.1 236.4 336.9 (237.6) 368.1
Amortisation and
depreciation (2,496.7) (2,183.7) (1,856.5) (532.0) (676.1) (394.5) (241.8) (12.1) (327.2) (114.6) (1.4) (97.8) (228.6) 115.2 (313.0)
Interest income 194.8 179.7 108.8 35.2 28.2 13.6 20.0 11.8 70.9 23.3 1.4 8.7 44.8 (7.3) 15.1
Finance expense (1,439.6) (1,266.9) (1,108.7) (114.3) (125.8) (66.9) (39.4) (762.3) (158.2) (39.5) - (5.2) (118.7) 5.2 (172.7)
Share-based payments (116.2) (114.5) (114.5) (2.5) (1.8) (1.3) - (108.9) - - - - - - (1.7)
Net other (26.7) (22.0) (43.4) (16.1) (14.8) (36.3) (171.0) 194.8 21.4 (20.8) (17.3) 36.3 (5.5) 28.7 (4.7)
Non-underlying items (4,392.3) (4,388.0) (4,302.7) (4.1) (3.4) (606.8) (2,196.8) (1,491.6) (85.3) (8.0) - - (72.8) (4.5) (4.3)
Royalties (172.9) (172.9) (140.8) (46.7) (69.5) (20.1) (4.5) - (32.1) (2.5) - (34.1) (29.6) 34.1 -
Current taxation (38.9) (63.9) (63.0) (5.4) (89.2) (1.3) - 32.9 (0.9) - (0.5) (16.1) - 15.7 25.0
Deferred taxation 453.3 438.7 458.7 (6.2) 37.2 190.8 1.5 235.4 (20.0) (28.1) 2.8 (1.7) 10.4 (3.4) 14.6
Loss for the period (4,802.7) (4,735.0) (4,709.1) 224.1 277.6 (522.9) (2,787.9) (1,900.0) (25.9) (51.8) 9.6 85.1 (57.5) (11.3) (67.7)
Attributable to:
Owners of Sibanye-
Stillwater (4,803.7) (4,736.0) (4,709.3) 224.1 277.6 (522.9) (2,787.9) (1,900.2) (26.7) (51.8) 8.8 85.1 (57.5) (11.3) (67.7)
Non-controlling interests 1.0 1.0 0.2 - - - - 0.2 0.8 - 0.8 - - - -
Sustaining capital
expenditure (509.0) (462.3) (175.9) (84.4) (51.8) (26.6) (8.5) (4.6) (286.4) (78.9) (5.4) (104.6) (202.1) 104.6 (46.7)
Ore reserve development (1,501.7) (1,387.2) (1,153.6) (419.4) (427.1) (253.4) (53.7) - (233.6) - - - (233.6) - (114.5)
Growth projects (473.1) (304.6) (304.6) (30.5) (61.0) (0.2) (11.7) (201.2) - - - - - - (168.5)
Total capital expenditure (2,483.8) (2,154.1) (1,634.1) (534.3) (539.9) (280.2) (73.9) (205.8) (520.0) (78.9) (5.4) (104.6) (435.7) 104.6 (329.7)
For the six months ended 30 Jun 2017 (Reviewed)
GROUP SA REGION US REGION(1)
Total SA Total SA Drie- Cor- Total SA Platinum Rusten- Cor-
US dollars(2) Total Region gold fontein Kloof Beatrix Cooke porate PGM Kroondal Mile Mimosa burg porate Stillwater
Revenue 1,454.9 1,307.6 853.6 304.4 303.6 178.3 67.3 - 454.0 98.7 6.4 61.0 348.9 (61.0) 147.3
Underground 1,235.8 1,168.8 764.6 267.8 272.3 172.6 51.9 - 404.2 98.7 - 61.0 305.5 (61.0) 67.0
Surface 138.8 138.8 89.0 36.6 31.3 5.7 15.4 - 49.8 - 6.4 - 43.4 - -
Recycling 80.3 - - - - - - - - - - - - - 80.3
Cost of sales, before
amortisation and
depreciation (1,210.2) (1,091.2) (675.5) (235.0) (213.3) (148.0) (79.2) - (415.7) (88.2) (4.5) (46.2) (323.0) 46.2 (119.0)
Underground (1,031.6) (990.1) (606.5) (208.0) (190.0) (142.2) (66.3) - (383.6) (88.2) - (46.2) (295.4) 46.2 (41.5)
Surface (101.1) (101.1) (69.0) (27.0) (23.3) (5.8) (12.9) - (32.1) - (4.5) - (27.6) - -
Recycling (77.5) - - - - - - - - - - - - - (77.5)
Net other cash costs (10.8) (10.4) (7.3) (1.4) (1.2) (0.4) (8.8) 4.5 (3.1) (1.2) (1.4) 3.1 (0.4) (3.2) (0.4)
Adjusted EBITDA 233.9 206.0 170.8 68.0 89.1 29.9 (20.7) 4.5 35.2 9.3 0.5 17.9 25.5 (18.0) 27.9
Amortisation and
depreciation (189.0) (165.3) (140.6) (40.3) (51.2) (29.9) (18.3) (0.9) (24.7) (8.7) (0.1) (7.4) (17.3) 8.8 (23.7)
Interest income 14.7 13.6 8.2 2.7 2.1 1.0 1.5 0.9 5.4 1.8 0.1 0.7 3.4 (0.6) 1.1
Finance expense (109.0) (95.9) (83.9) (8.7) (9.5) (5.1) (2.9) (57.7) (12.0) (3.0) - (0.4) (9.0) 0.4 (13.1)
Share-based payments (8.8) (8.7) (8.7) (0.2) (0.1) (0.1) - (8.3) - - - - - - (0.1)
Net other (2.1) (1.8) (3.1) (1.2) (1.0) (2.8) (12.8) 14.7 1.3 (1.6) (1.4) 2.6 (0.5) 2.2 (0.3)
Non-underlying items (332.5) (332.2) (325.7) (0.3) (0.3) (45.9) (166.3) (112.9) (6.5) (0.6) - - (5.5) (0.4) (0.3)
Royalties (13.1) (13.1) (10.7) (3.5) (5.3) (1.5) (0.4) - (2.4) (0.2) - (2.6) (2.2) 2.6 -
Current taxation (2.9) (4.8) (4.8) (0.4) (6.8) (0.1) - 2.5 - - - (1.2) - 1.2 1.9
Deferred taxation 34.3 33.2 34.7 (0.5) 2.8 14.5 0.1 17.8 (1.5) (2.1) 0.2 (0.1) 0.8 (0.3) 1.1
Loss for the period (363.7) (358.6) (356.5) 17.0 21.0 (39.6) (211.0) (143.9) (2.1) (3.9) 0.7 6.4 (4.4) (0.9) (5.1)
Attributable to:
Owners of Sibanye-
Stillwater (363.8) (358.7) (356.5) 17.0 21.0 (39.6) (211.0) (143.9) (2.2) (3.9) 0.6 6.4 (4.4) (0.9) (5.1)
Non-controlling interests 0.1 0.1 - - - - - - 0.1 - 0.1 - - - -
Sustaining capital
expenditure (38.4) (34.9) (13.2) (6.4) (3.9) (2.0) (0.6) (0.3) (21.7) (6.0) (0.4) (7.9) (15.3) 7.9 (3.5)
Ore reserve development (113.7) (105.0) (87.3) (31.7) (32.3) (19.2) (4.1) - (17.7) - - - (17.7) - (8.7)
Growth projects (35.9) (23.1) (23.1) (2.3) (4.6) - (0.9) (15.3) - - - - - - (12.8)
Total capital expenditure (188.0) (163.0) (123.6) (40.4) (40.8) (21.2) (5.6) (15.6) (39.4) (6.0) (0.4) (7.9) (33.0) 7.9 (25.0)
(1) The US PGM operations' results for the six months ended 30 June 2017 includes Stillwater for two months since acquisition.
(2) The average exchange rate for the six months ended 30 June 2017 was R13.21/US$.
ALL-IN COSTS FOR THE SIX MONTHS ENDED 30 JUNE 2018, 31 DECEMBER 2017 AND 30 JUNE 2017
SA and US PGM operations
Figures are in millions unless otherwise stated
GROUP SA REGION US REGION(1)
Total SA
Total PGM Kroondal Mimosa Plat Mile Rustenburg Corporate Stillwater(1)
Cost of sales, before amortisation and depreciation(2) Jun 2018 7,482.8 5,716.1 1,255.7 583.9 63.7 4,396.7 (583.9) 1,766.7
Dec 2017 8,187.0 6,100.2 1,230.3 589.6 70.3 4,799.6 (589.6) 2,086.8
Jun 2017 6,039.6 5,491.6 1,165.6 610.9 59.5 4,266.5 (610.9) 548.0
Royalties Jun 2018 20.9 20.9 2.4 28.9 - 18.5 (28.9) -
Dec 2017 39.0 39.0 3.1 26.3 - 36.0 (26.4) -
Jun 2017 32.1 32.1 2.5 34.1 - 29.6 (34.1) -
Community costs Jun 2018 8.6 8.6 0.1 - - 8.5 - -
Dec 2017 - - - - - - - -
Jun 2017 - - - - - - - -
Inventory change Jun 2018 236.0 - - - - - - 236.0
Dec 2017 3.9 - - - - - - 3.9
Jun 2017 100.0 - - - - - - 100.0
Share-based payments(3) Jun 2018 16.6 - - - - - - 16.6
Dec 2017 3.2 - - - - - - 3.2
Jun 2017 1.7 - - - - - - 1.7
Rehabilitation interest and amortisation(4) Jun 2018 50.9 46.4 38.9 2.0 - 7.4 (1.9) 4.5
Dec 2017 (0.1) (5.5) 17.8 2.2 - (23.4) (2.1) 5.4
Jun 2017 39.5 38.5 31.0 2.0 - 7.4 (1.9) 1.0
Ore reserve development Jun 2018 666.3 226.7 - - - 226.7 - 439.6
Dec 2017 655.5 231.4 - - - 231.4 - 424.1
Jun 2017 348.1 233.6 - - - 233.6 - 114.5
Sustaining capital expenditure Jun 2018 254.2 143.5 49.9 65.7 4.8 88.8 (65.7) 110.7
Dec 2017 461.4 281.2 111.6 117.9 5.6 164.0 (117.9) 180.2
Jun 2017 333.1 286.4 78.9 - 5.4 202.1 - 46.7
Less: By-product credit Jun 2018 (1,248.8) (1,039.5) (119.9) (178.6) (4.3) (915.4) 178.7 (209.3)
Dec 2017 (1,197.8) (1,009.2) (89.5) (152.4) (6.1) (913.6) 152.4 (188.6)
Jun 2017 (640.4) (590.9) (96.6) (120.8) (4.4) (489.9) 120.8 (49.5)
Total All-in-sustaining costs(5) Jun 2018 7,487.5 5,122.7 1,227.1 501.9 64.2 3,831.2 (501.7) 2,364.8
Dec 2017 8,152.1 5,637.1 1,273.3 583.6 69.8 4,294.0 (583.6) 2,515.0
Jun 2017 6,253.7 5,491.3 1,181.4 526.2 60.5 4,249.3 (526.1) 762.4
Plus: Corporate cost, growth and capital expenditure Jun 2018 701.7 34.0 - - 33.4 0.6 - 667.7
Dec 2017 725.6 2.3 - - 2.3 - - 723.3
Jun 2017 176.2 - - - - - - 176.2
Total All-in-costs(5) Jun 2018 8,189.2 5,156.7 1,227.1 501.9 97.6 3,831.8 (501.7) 3,032.5
Dec 2017 8,877.7 5,639.4 1,273.3 583.6 72.1 4,294.0 (583.6) 3,238.3
Jun 2017 6,429.9 5,491.3 1,181.4 526.2 60.5 4,249.3 (526.1) 938.6
PGM production 4Eoz - 2Eoz Jun 2018 863,125 569,166 120,461 62,270 7,718 378,717 - 293,959
Dec 2017 886,266 603,635 126,607 63,274 10,545 403,209 - 282,631
Jun 2017 684,437 590,712 114,619 60,879 8,898 406,316 - 93,725
kg Jun 2018 26,846 17,703 3,747 1,937 240 11,779 - 9,143
Dec 2017 27,566 18,775 3,938 1,968 328 12,541 - 8,791
Jun 2017 21,288 18,373 3,565 1,894 277 12,638 - 2,915
All-in-sustaining cost R/4Eoz - R/2Eoz Jun 2018 9,349 10,106 10,187 8,060 8,318 10,116 - 8,045
Dec 2017 9,905 10,432 10,057 9,223 6,619 10,650 - 8,899
Jun 2017 10,029 10,364 10,307 8,643 6,799 10,458 - 8,134
US$/4Eoz - US$/2Eoz Jun 2018 760 821 828 655 676 822 - 653
Dec 2017 739 778 750 688 494 794 - 660
Jun 2017 759 785 781 655 515 792 - 622
All-in-cost R/4Eoz - R/2Eoz Jun 2018 10,226 10,173 10,187 8,060 12,646 10,118 - 10,316
Dec 2017 10,787 10,436 10,057 9,223 6,837 10,650 - 11,458
Jun 2017 10,312 10,364 10,307 8,643 6,799 10,458 - 10,014
US$/4Eoz - US$/2Eoz Jun 2018 831 826 828 655 1,027 822 - 838
Dec 2017 805 779 750 688 510 794 - 855
Jun 2017 781 785 781 655 515 792 - 765
Average exchange rate for the six months ended 30 June 2018, 31 December 2017 and 30 June 2017 was R12.31/US$, R13.41/US$ and R13.21/US$, respectively.
Figures may not add as they are rounded independently.
(1) The US PGM operations' results for the six months ended 30 June 2017 include Stillwater for the two months since acquisition. The US PGM operations' underground prodution is
converted to metric tonnes and kilograms, and performance is translated into SA rand. In addition to the US PGM operations' underground production, the operation treats various
recycling material which is excluded from the 2E PGM production, All-in sustaining cost and All-in cost statistics shown.
All-in costs are calculated in accordance with the World Gold Council guidance:
(2) Cost of sales, before amortisation and depreciation includes all mining and processing costs, third party refining costs, corporate general and administrative costs, and permitting
costs.
(3) Share-based payments are calculated based on the fair value at initial recognition fair value and does not include the adjustment of the cash-settled share-based payment
obligation to the reporting date fair value.
(4) Rehabilitation includes the interest charge related to the environmental rehabilitation obligation and the amortisation of the related capitalised rehabilitation costs. The interest charge
related to the environmental rehabilitation obligation and the amortisation of the capitalised rehabilitation costs reflect the periodic costs of rehabilitation associated with current PGM
production.
(5) All-in costs exclude income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed
to normalise earnings. All-in costs are made up of All-in sustaining costs, being the costs to sustain current operations, given as a sub-total in the All-in costs calculation, together with
corporate and major capital expenditure associated with growth.
The US region All-in-cost, excluding the corporate project expenditure (on the Altar and Marathon projects), for the six months ended 30 June 2018, 31 December 2017 and 30 June
2017 was US$822/2Eoz, US$845/2Eoz and US$765/2Eoz, respectively.
SA gold operations
Figures are in millions unless otherwise stated
SA REGION
Total SA
gold Driefontein Kloof Beatrix Cooke Corporate
Cost of sales, before amortisation and depreciation(1) Jun 2018 8,372.7 2,977.4 3,165.6 1,965.8 263.9 -
Dec 2017 8,956.5 3,098.4 2,945.2 1,997.7 915.2 -
Jun 2017 8,922.7 3,105.1 2,817.5 1,954.8 1,045.3 -
Royalties Jun 2018 82.8 15.1 48.4 17.9 1.5 (0.1)
Dec 2017 184.5 31.1 119.8 24.4 9.2 -
Jun 2017 140.8 46.7 69.5 20.1 4.5 -
Community costs Jun 2018 24.7 9.8 7.9 7.0 - -
Dec 2017 22.0 3.6 12.1 5.8 0.5 -
Jun 2017 9.1 3.2 3.9 1.5 0.5 -
Share-based payments(2) Jun 2018 0.2 0.2 - - - -
Dec 2017 0.3 0.3 - - - -
Jun 2017 5.6 2.5 1.8 1.3 - -
Rehabilitation interest and amortisation(3) Jun 2018 4.3 (10.2) (21.8) 15.3 19.0 2.0
Dec 2017 32.0 (20.2) 18.3 11.3 23.5 (0.9)
Jun 2017 68.5 (11.4) 22.0 14.3 41.6 2.0
Ore reserve development Jun 2018 1,030.3 419.1 397.9 213.3 - -
Dec 2017 1,134.4 456.7 449.1 228.6 - -
Jun 2017 1,153.6 419.4 427.1 253.4 53.7 -
Sustaining capital expenditure Jun 2018 184.4 84.1 75.4 24.2 0 0.7
Dec 2017 345.5 150.6 158.4 36.5 - -
Jun 2017 171.3 84.4 51.8 26.6 8.5 -
Less: By-product credit Jun 2018 (9.2) (3.6) (3.1) (2.2) (0.4) 0.1
Dec 2017 (11.4) (3.8) (3.6) (2.7) (1.3) -
Jun 2017 (11.8) (4.5) (2.9) (3.0) (1.4) -
Total All-in-sustaining costs(4) Jun 2018 9,690.2 3,491.9 3,670.3 2,241.3 284.0 2.7
Dec 2017 10,663.8 3,716.7 3,699.3 2,301.6 947.1 (0.9)
Jun 2017 10,459.8 3,645.4 3,390.7 2,269.0 1,152.7 2.0
Plus: Corporate cost, growth and capital expenditure Jun 2018 215.6 0.3 72.7 0.3 0 142.3
Dec 2017 298.1 13.8 86.1 2.3 - 195.9
Jun 2017 418.1 30.6 61.0 0.2 11.7 314.6
Total All-in-costs(4) Jun 2018 9,905.8 3,492.2 3,743.0 2,241.6 284.0 145.0
Dec 2017 10,961.9 3,730.5 3,785.4 2,303.9 947.1 195.0
Jun 2017 10,877.9 3,676.0 3,451.7 2,269.2 1,164.4 316.6
Gold sold kg Jun 2018 18,616 5,790 7,905 4,380 541 -
Dec 2017 22,216 7,400 8,806 4,590 1,420 -
Jun 2017 21,547 7,688 7,660 4,501 1,698 -
000'oz Jun 2018 598.5 186.2 254.2 140.8 17.4 -
Dec 2017 714.2 237.9 283.1 147.6 45.6 -
Jun 2017 692.7 247.2 246.3 144.7 54.5 -
All-in-sustaining cost R/kg Jun 2018 520,531 603,092 464,301 511,712 524,954 -
Dec 2017 480,005 502,257 420,089 501,438 666,972 -
Jun 2017 485,441 474,168 442,650 504,110 678,857 -
US$/oz Jun 2018 1,315 1,524 1,173 1,293 1,326 -
Dec 2017 1,114 1,165 975 1,163 1,548 -
Jun 2017 1,143 1,117 1,043 1,187 1,599 -
All-in-cost R/kg Jun 2018 532,112 603,143 473,498 511,781 524,954 -
Dec 2017 493,424 504,122 429,866 501,939 666,972 -
Jun 2017 504,845 478,148 450,614 504,155 685,748 -
US$/oz Jun 2018 1,345 1,524 1,196 1,293 1,326 -
Dec 2017 1,145 1,170 997 1,165 1,548 -
Jun 2017 1,189 1,126 1,061 1,188 1,615 -
Average exchange rate for the six months ended 30 June 2018, 31 December 2017 and 30 June 2017 was R12.31/US$, R13.41/US$ and R13.21/US$, respectively.
Figures may not add as they are rounded independently.
All-in costs are calculated in accordance with the World Gold Council guidance:
(1) Cost of sales, before amortisation and depreciation includes all mining and processing costs, third party refining costs, corporate general and administrative costs, and permitting
costs.
(2) Share-based payments are calculated based on the fair value at initial recognition fair value and does not include the adjustment of the cash-settled share-based payment obligation
to the reporting date fair value.
(3) Rehabilitation include the interest charge related to the environmental rehabilitation obligation and the amortisation of the related capitalised rehabilitation costs. The interest charge
related to the environmental rehabilitation obligation and the amortisation of the capitalised rehabilitation costs reflect the periodic costs of rehabilitation associated with current gold
production.
(4) All-in costs exclude income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed
to normalise earnings. All-in costs are made up of All-in sustaining costs, being the costs to sustain current operations, given as a sub-total in the All-in costs calculation, together with
corporate and major capital expenditure associated with growth.
SALIENT FEATURES AND COST BENCHMARKS FOR THE QUARTERS ENDED 30 JUNE 2018 AND
31 MARCH 2018
SA and US PGM operations
GROUP SA REGION US REGION
Total US
PGM
Total SA PGM Kroondal Mimosa Plat Mile Rustenburg Stillwater
Total SA
and US PGM Under- Under- Under-
Attributable operations Total ground Surface Attributable Attributable Surface ground Surface ground(1)
Production
Tonnes milled/treated 000't Jun 2018 6,958 6,632 3,057 3,575 961 361 2,070 1,735 1,505 326
Mar 2018 6,128 5,803 2,890 2,913 874 338 1,678 1,678 1,235 325
Plant head grade g/t Jun 2018 2.56 1.95 3.25 0.82 2.50 3.57 0.62 3.54 1.12 15.17
Mar 2018 2.80 2.09 3.30 0.89 2.47 3.56 0.58 3.68 1.31 15.52
Plant recoveries % Jun 2018 74.80 68.34 81.11 24.41 82.51 77.76 9.69 83.23 34.61 91.31
Mar 2018 78.74 73.51 84.94 31.41 81.92 78.15 11.94 87.32 43.09 91.38
Yield g/t Jun 2018 1.91 1.33 2.65 0.20 2.06 2.77 0.06 2.95 0.39 13.87
Mar 2018 2.21 1.53 2.80 0.28 2.02 2.77 0.07 3.21 0.56 14.22
PGM production(2) 4Eoz - 2Eoz Jun 2018 428,382 282,972 260,198 22,774 63,697 32,141 3,995 164,360 18,779 145,410
Mar 2018 434,743 286,194 260,069 26,125 56,764 30,129 3,723 173,176 22,402 148,549
PGM sold 4Eoz - 2Eoz Jun 2018 419,656 282,972 260,198 22,774 63,697 32,141 3,995 164,360 18,779 136,684
Mar 2018 420,856 286,194 260,069 26,125 56,764 30,129 3,723 173,176 22,402 134,662
Price and costs(3)
Average PGM basket price(4) R/4Eoz - R/2Eoz Jun 2018 12,724 13,013 13,041 12,726 13,447 12,814 13,137 12,884 12,638 12,225
Mar 2018 12,637 12,839 12,871 12,643 12,955 12,655 12,962 12,830 12,590 12,289
US$/4Eoz - US$/2Eoz Jun 2018 1,005 1,028 1,031 1,006 1,063 1,013 1,038 1,018 999 966
Mar 2018 1,058 1,073 1,076 1,057 1,083 1,058 1,083 1,073 1,053 1,027
Operating cost(5) R/t Jun 2018 592 474 1,012 68 657 899 16 1,209 139 2,862
Mar 2018 626 502 994 72 714 769 18 1,140 145 2,708
US$/t Jun 2018 47 37 80 5 52 71 1 96 11 226
Mar 2018 52 42 83 6 60 64 2 95 12 226
R/4Eoz - R/2Eoz Jun 2018 7,496 11,842 11,964 10,622 9,916 10,087 8,310 12,758 11,113 6,411
Mar 2018 6,785 10,722 11,032 7,996 10,986 8,620 8,165 11,044 7,968 5,921
US$/4Eoz - US$/2Eoz Jun 2018 592 936 945 839 784 797 657 1,008 878 507
Mar 2018 567 896 922 669 919 721 683 923 666 495
All-in sustaining cost(6) R/4Eoz - R/2Eoz Jun 2018 9,475 10,025 9,597 8,579 6,383 10,252 8,526
Mar 2018 9,310 10,186 10,477 8,706 10,341 9,990 7,559
US$/4Eoz - US$/2Eoz Jun 2018 749 792 758 678 504 810 674
Mar 2018 778 852 876 728 864 835 632
All-in cost(6) R/4Eoz - R/2Eoz Jun 2018 10,398 10,160 9,597 8,579 14,743 10,255 10,809
Mar 2018 10,152 10,186 10,477 8,706 10,341 9,990 9,834
US$/4Eoz - US$/2Eoz Jun 2018 822 803 758 678 1,165 810 854
Mar 2018 849 852 876 728 864 835 822
Capital expenditure
Ore reserve development Rm Jun 2018 339.1 116.3 - - - 116.3 222.8
Mar 2018 327.8 110.4 - - - 110.4 217.4
Sustaining capital Jun 2018 143.7 66.4 29.0 29.6 (5.4) 42.8 77.3
Mar 2018 98.6 77.1 20.9 72.3 10.2 46.0 21.5
Corporate and projects(7) Jun 2018 365.9 34.0 - - 33.4 0.6 331.9
Mar 2018 335.9 - - - - - 335.9
Total capital expenditure Rm Jun 2018 848.8 216.8 29.0 29.6 28.0 159.8 632.0
Mar 2018 762.2 187.4 20.9 72.3 10.2 156.3 574.8
US$m Jun 2018 67.1 17.1 2.3 2.3 2.2 12.6 49.9
Mar 2018 64.0 16.0 2.0 6.0 1.0 13.0 48.0
Average exchange rate for the quarter ended 30 June 2018 and 31 March 2018 was R12.65/US$ and R11.96/US$, respectively.
Figures may not add as they are rounded independently.
(1) The US PGM operations' underground production is converted to metric tonnes and kilograms, and performance is translated into SA rand. In addition to the US PGM operations'
underground production, the operation treats recycling material which is excluded from the statistics shown, except for adjusted EBITDA margin and is detailed in the PGM recycling
table below.
(2) Production per product - see prill split in the table below.
(3) The Group and total SA PGM operations' unit cost benchmarks exclude the financial results of Mimosa, which is equity accounted and excluded from revenue and cost of sales.
(4) The average PGM basket price is the PGM revenue per 4E/2E ounce, prior to a purchase of concentrate adjustment.
(5) Operating cost is the average cost of production and calculated by dividing the cost of sales, before amortisation and depreciation in a period by the tonnes milled/treated in the same period,
and operating cost per ounce (and kilogram) is calculated by dividing the cost of sales, before amortisation and depreciation in a period by the PGM produced in the same period.
(6) All-in costs exclude income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed
to normalise earnings. All-in costs are made up of All-in sustaining costs, being the cost to sustain current operations, given as a sub-total in the All-in costs calculation, together with
corporate and major capital expenditure associated with growth. All-in sustaining cost per ounce (and kilogram) and All-in cost per ounce (and kilogram) are calculated by dividing the All-in
sustaining costs and All-in costs, respectively, in a period by the total 4E/2E PGM produced in the same period.
The US region All-in-cost, excluding the corporate project expenditure (on the Altar and Marathon projects), for the quarters ended 30 June 2018 and 31 March 2018 was US$832/2Eoz
and US$811/2Eoz, respectively.
(7) The US region corporate expenditure for the quarters ended 30 June 2018 and 31 March 2018 was R41.4 million (US$3.4 million) and R16.6 million (US$1.4 million), respectively, which
related to the Altar and Marathon projects.
Mining - Prill split excluding recycling operation
GROUP SA REGION US REGION
Jun 2018 Jun 2018 Mar 2018 Jun 2018 Mar 2018
4Eoz /
2Eoz % 4Eoz % 4Eoz % 2Eoz % 2Eoz %
Platinum 197,721 46% 164,959 58% 166,440 58% 32,762 23% 33,189 22%
Palladium 200,342 47% 87,694 31% 88,909 31% 112,648 77% 115,360 78%
Rhodium 20,096 5% 20,096 7% 24,156 8%
Gold 10,223 2% 10,223 4% 6,690 2%
PGM production 428,382 100% 282,972 100% 286,195 100% 145,410 100% 148,549 100%
Ruthenium 37,465 37,465 37,964
Iridium 9,969 9,969 7,249
Total 475,816 330,406 331,408 145,410 148,549
Recycling operation
US REGION
Unit Jun 2018 Mar 2018
Average catalyst
fed/day Tonne 21.8 25.8
Total processed Tonne 1,984 2,323
Tolled Tonne 307 365
Purchased Tonne 1,677 1,958
PGM fed 3Eoz 168,842 191,404
PGM sold 3Eoz 147,872 155,455
PGM tolled returned 3Eoz 29,996 38,260
SA gold operations
SA REGION
Total SA gold Driefontein Kloof Beatrix Cooke
Under- Under- Under- Under- Under-
Total ground Surface ground Surface ground Surface ground Surface ground Surface
Production
Tonnes milled/treated 000't Jun 2018 4,772 1,619 3,153 450 388 479 1,624 685 111 5 1,030
Mar 2018 4,283 1,525 2,758 500 815 478 1,075 547 173 - 695
Yield g/t Jun 2018 2.00 5.19 0.36 5.59 0.52 7.21 0.37 3.55 0.37 1.20 0.29
Mar 2018 2.12 5.25 0.39 5.67 0.29 6.95 0.49 3.37 0.37 - 0.35
Gold produced kg Jun 2018 9,548 8,403 1,145 2,516 203 3,452 606 2,429 41 6 295
Mar 2018 9,068 8,002 1,066 2,833 238 3,323 524 1,846 64 - 240
oz Jun 2018 306,974 270,162 36,812 80,891 6,527 110,984 19,483 78,094 1,318 193 9,484
Mar 2018 291,543 257,270 34,273 91,083 7,652 106,837 16,847 59,350 2,058 - 7,716
Gold sold kg Jun 2018 9,548 8,403 1,145 2,516 203 3,452 606 2,429 41 6 295
Mar 2018 9,068 8,002 1,066 2,833 238 3,323 524 1,846 64 - 240
oz Jun 2018 306,974 270,162 36,812 80,891 6,527 110,984 19,483 78,094 1,318 193 9,484
Mar 2018 291,543 257,270 34,273 91,083 7,652 106,837 16,847 59,350 2,058 - 7,716
Price and costs
Gold price received R/kg Jun 2018 531,640 531,519 531,099 538,907 547,508
Mar 2018 507,719 511,918 511,152 510,157 529,583
US$/oz Jun 2018 1,307 1,306 1,305 1,325 1,346
Mar 2018 1,320 1,331 1,329 1,326 1,377
Operating cost(1) R/t Jun 2018 910 2,345 173 3,115 196 2,878 194 1,483 123 140 137
Mar 2018 934 2,314 182 2,661 208 2,668 182 1,680 97 - 172
US$/t Jun 2018 72 185 14 246 15 227 15 117 10 11 11
Mar 2018 78 193 15 222 17 223 15 140 8 - 14
R/kg Jun 2018 454,881 451,886 476,856 557,075 374,384 399,421 520,957 418,320 334,146 116,667 476,610
Mar 2018 444,387 440,890 470,638 469,714 710,924 383,720 374,237 497,941 262,500 - 498,333
US$/oz Jun 2018 1,118 1,111 1,172 1,369 920 982 1,280 1,028 821 287 1,171
Mar 2018 1,155 1,146 1,224 1,221 1,848 998 973 1,295 682 - 1,296
All-in sustaining cost(2) R/kg Jun 2018 526,833 646,083 479,966 475,951 496,678
Mar 2018 513,829 565,093 447,777 557,958 560,417
US$/oz Jun 2018 1,295 1,588 1,180 1,170 1,221
Mar 2018 1,336 1,469 1,165 1,451 1,457
All-in cost(2) R/kg Jun 2018 542,187 646,193 489,724 476,032 496,678
Mar 2018 535,851 565,093 456,408 558,010 560,417
US$/oz Jun 2018 1,333 1,588 1,204 1,170 1,221
Mar 2018 1,393 1,469 1,187 1,451 1,457
Capital expenditure
Ore reserve
development Rm Jun 2018 532.1 220.3 203.8 108.0 -
Mar 2018 498.2 198.8 194.1 105.3 -
Sustaining capital Jun 2018 105.7 55.9 35.1 14.7 -
Mar 2018 77.9 28.2 40.2 9.5 -
Corporate and projects(3) Jun 2018 93.1 0.3 39.6 0.2 -
Mar 2018 123.2 - 33.2 0.1 -
Total capital
expenditure Rm Jun 2018 731.0 276.5 278.5 122.9 -
Mar 2018 699.2 227.0 267.5 114.9 -
US$m Jun 2018 57.8 21.8 22.0 9.7 -
Mar 2018 58.5 19.0 22.4 9.6 -
Average exchange rates for the quarters ended 30 June 2018 and 31 March 2018 were R12.65/US$ and R11.96/US$, respectively.
Figures may not add as they are rounded independently.
(1) Operating cost is the average cost of production and calculated by dividing the cost of sales, before amortisation and depreciation in a period by the tonnes milled/treated in the same period,
and operating cost per kilogram (and ounce) is calculated by dividing the cost of sales, before amortisation and depreciation in a period by the gold produced in the same period.
(2) All-in costs exclude income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed to normalise
earnings. All-in costs are made up of All-in sustaining costs, being the cost to sustain current operations, given as a sub-total in the All-in costs calculation, together with corporate and major capital
expenditure associated with growth. All-in sustaining cost per kilogram (and ounce) and All-in cost per kilogram (and ounce) are calculated by dividing the All-in sustaining costs and All-in costs,
respectively, in a period by the total gold sold in the same period.
(3) Corporate project expenditure for the quarters ended 30 June 2018 and 31 March 2018 was R53.2 million (US$4.2 million) and R89.8 million (US$7.5 million), respectively, the majority of which
related to the Burnstone project.
DEVELOPMENT RESULTS
Development values represent the actual results of sampling and no allowance has been made for any adjustments which may be
necessary when estimating ore reserves. All figures below exclude shaft sinking metres, which are reported separately where appropriate.
SA gold operations
Quarter ended Jun 2018 Mar 2018 Six months ended 30 Jun 2018
Black Carbon Black Carbon Black Carbon
Reef Reef leader Main VCR Reef leader Main VCR Reef leader Main VCR
Driefontein Unit
Advanced (m) 65 1,688 676 867 66 1,441 660 992 131 3,128 1,336 1,859
Advanced on reef (m) 59 377 149 197 49 293 228 128 108 670 377 325
Channel width (cm) 165 54 36 93 46 35 62 56 111 45 52 78
Average value (g/t) 2.1 19.1 13.8 31.9 4.7 30.0 8.6 85.8 2.6 22.8 10.0 47.0
(cm.g/t) 346 1,025 496 2,961 214 1,041 534 4,774 287 1,032 519 3,675
Quarter ended Jun 2018 Mar 2018 Six months ended 30 Jun 2018
Reef Cobble Kloof Main Libanon VCR Cobble Kloof Main Libanon VCR Cobble Kloof Main Libanon VCR
Kloof Unit
Advanced (m) 1,220 579 21 1,582 1,158 605 9 1,148 2,377 1,184 30 2,730
Advanced on reef (m) 333 122 - 351 373 81 9 255 706 203 9 606
Channel width (cm) 133 126 104 129 126 99 104 131 126 99 104
Average value (g/t) 6.2 7.8 - 21.5 9.6 6.6 11.3 20.5 8.0 7.3 11.3 21.1
(cm.g/t) 827 986 2,233 1,244 832 1,120 2,139 1,047 925 1,120 2,193
Quarter ended Jun 2018 Mar 2018 Six months ended 30 Jun 2018
Reef Beatrix Kalkoenkrans Beatrix Kalkoenkrans Beatrix Kalkoenkrans
Beatrix Unit
Advanced (m) 4,486 29 3,909 64 8,395 93
Advanced on reef (m) 1,354 - 1,234 21 2,587 21
Channel width (cm) 115 - 118 168 116 168
Average value (g/t) 6.6 - 5.8 9.6 6.2 9.6
(cm.g/t) 760 - 688 1,619 726 1,619
Quarter ended Jun 2018 Mar 2018 Six months ended 30 Jun 2018
Kimberley Kimberley Kimberley
Reef Reefs Reefs Reefs
Burnstone Unit
Advanced (m) 383 1,266 1,648
Advanced on reef (m) 100 193 293
Channel width (cm) 30 69 56
Average value (g/t) 13.8 9.2 10.0
(cm.g/t) 414 634 559
SA PGM operations
Quarter ended Jun 2018 Mar 2018 Six months ended 30 Jun 2018
Reef Kopaneng Simunye Bambanani Kwezi K6 Kopaneng Simunye Bambanani Kwezi K6 Kopaneng Simunye Bambanani Kwezi K6
Kroondal Unit
Advanced (m) 678 539 592 636 555 428 481 578 609 802 1,107 1,020 1,170 1,245 1,357
Advanced on reef (m) 632 451 582 529 431 409 362 402 535 657 1,042 813 984 1,064 1,089
Height (cm) 239 241 222 246 264 236 229 217 245 246 238 236 220 246 253
Average value (g/t) 2.0 1.8 2.7 2.2 1.7 2.2 2.2 2.0 2.2 2.2 2.1 2.0 2.3 2.2 2.0
(cm.g/t) 468 438 592 529 440 520 494 429 543 536 493 466 510 536 500
Quarter ended Jun 2018 Mar 2018 Six months ended 30 Jun 2018
Reef Bathopele Thembelani Khuseleka Siphumelele Bathopele Thembelani Khuseleka Siphumelele Bathopele Thembelani Khuseleka Siphumelele
Rustenburg Unit
Advanced (m) 316 1,780 2,418 1,116 302 1,466 2,190 1,057 618 3,246 4,608 2,173
Advanced on reef (m) 316 832 775 525 302 502 596 340 618 1,334 1,370 865
Height (cm) 215 297 290 288 209 281 288 296 212 289 289 292
Average value (g/t) 2.6 2.3 2.2 3.0 2.7 2.1 2.1 3.1 2.6 2.2 2.2 3.1
(cm.g/t) 559 678 630 868 559 582 614 932 553 636 622 892
US PGM operations
Quarter ended Jun 2018 Mar 2018 Six months ended 30 Jun 2018
Stillwater East Stillwater East Stillwater East
Reef incl Blitz Boulder incl Blitz Boulder incl Blitz Boulder
Stillwater Unit
Primary
development (off
reef) (m) 2,695 402 3,019 657 5,714 1,059
Secondary
development (m) 2,153 1,340 2,038 1,451 4,191 2,791
ADMINISTRATION AND CORPORATE INFORMATION
SIBANYE GOLD LIMITED DIRECTORS AMERICAN DEPOSITORY
Trading as SIBANYE-STILLWATER Sello Moloko1 (Chairman) RECEIPTS TRANSFER AGENT
Incorporated in the Republic of South Africa Neal Froneman (CEO) BNY Mellon Shareowner Services
Registration number 2002/031431/06 Charl Keyter (CFO) PO Box 358516
Share code: SGL Savannah Danson(1) Pittsburgh
Issuer code: SGL Timothy Cumming(1) PA15252-8516
ISIN: ZAE E000173951 Barry Davison(1) US toll-free: +1 888 269 2377
Rick Menell(1) Tel: +1 201 680 6825
LISTINGS Nkosemntu Nika(1) Email: shrrelations@bnymellon.com
JSE: SGL Keith Rayner(1)
NYSE: SBGL Susan van der Merwe(1) Tatyana Vesselovskaya
Jerry Vilakazi(1) Relationship Manager
WEBSITE (1) Independent non-executive BNY Mellon
www.sibanyestillwater.com Depositary Receipts
JSE SPONSOR Direct Line: +1 212 815 2867
REGISTERED AND CORPORATE OFFICE JP Morgan Equities South Africa Proprietary Mobile: +1 203 609 5159
Constantia Office Park Limited Fax: +1 212 571 3050
Cnr 14th Avenue & Hendrik Potgieter Road (Registration number : 1995/011815/07) Email: tatyana.vesselovskaya@bnymellon.com
Bridgeview House, Ground Floor 1 Fricker Road
Weltevreden Park 1709 Illovo TRANSFER SECRETARIES
South Africa Johannesburg 2196 SOUTH AFRICA
South Africa Computershare Investor Services Proprietary Limited
Private Bag X5 Rosebank Towers
Westonaria 1780 Private Bag X9936 15 Biermann Avenue
South Africa Sandton 2196 Rosebank 2196
Tel: +27 11 278 9600 South Africa
Fax: +27 11 278 9863 PO Box 61051
OFFICE OF THE UNITED KINGDOM Marshalltown 2107
INVESTOR ENQUIRIES SECRETARIES LONDON South Africa
James Wellsted St James's Corporate Services Limited Tel: +27 11 370 5000
Senior Vice President: Suite 31 Fax: +27 11 688 5248
Investor Relations Second Floor
Tel: +27 83 453 4014 107 Cheapside TRANSFER SECRETARIES
+27 10 493 6923 London EC2V 6DN UNITED KINGDOM
Email: james.wellsted@sibanyestillwater.com United Kingdom Link Asset Services
or ir@sibanyestillwater.com Tel: +44 20 7796 8644 The Registry
Fax: +44 20 7796 8645 34 Beckenham Road
CORPORATE SECRETARY Beckenham
Lerato Matlosa AUDITORS Kent BR3 4TU
Tel: +27 10 493 6921 KPMG Inc. England
Email: lerato.matlosa@sibanyestillwater.com KPMG Crescent Tel:0871 664 0300
85 Empire Road (calls cost 10p a minute plus network extras, lines are
Parktown 2193 open 8.30am - 5pm Mon-Fri) or
Johannesburg +44 20 8639 3399 (from overseas)
South Africa Fax: +44 20 8658 3430
Tel: +27 11 647 7111 Email: ssd@capitaregistrars.com
FORWARD-LOOKING STATEMENTS
This announcement contains "forward-looking statements" within the meaning of the "safe harbour" provisions of the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "target", "will", "would", "expect", "can",
"potential", "could" and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These
forward-looking statements, including among others, those relating to our future business prospects, financial positions, debt position and our ability
to reduce debt leverage, plans and objectives of management for future operations, plans to raise capital through streaming arrangements or
pipeline financing, our ability to service our Bond Instruments (High Yield Bonds and Convertible Bonds), our ability to achieve steady state production
at the Blitz project and the anticipated benefits and synergies of our acquisitions are necessarily estimates reflecting the best judgement of our senior
management and involve a number of known and unknown risks, uncertainties and other factors, many of which are difficult to predict and generally
beyond the control of Sibanye-Stillwater, that could cause Sibanye-Stillwater's actual results and outcomes to be materially different from historical
results or from any future results expressed or implied by such forward-looking statements. As a consequence, these forward-looking statements
should be considered in light of various important factors, including those set forth in the Group's Annual Integrated Report and Annual Financial
Report, published on 30 March 2018, and the Group's Annual Report on Form 20-F filed by Sibanye-Stillwater with the Securities and Exchange
Commission on 2 April 2018 (SEC File no. 001-35785). These forward-looking statements speak only as of the date of this announcement. Sibanye-
Stillwater undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances
after the date of this announcement or to reflect the occurrence of unanticipated events, save as required by applicable law.
Date: 23/08/2018 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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