The first-quarter performance of Sibanye-Stillwater’s platinum group metal (PGM) assets in SA and the US underscored the strategic intent of the company to diversify away from its South African gold mines, which had a very difficult start to the year. Sibanye said on Thursday it had delayed R550m in capital expenditure at its South African gold and platinum operations because the strong rand had eroded profit margins. "With the PGM operations providing 76% of the ebitda [earnings before interest, tax, depreciation and amortisation] and about 100% of the cash flow, the diversification strategy is very much showing its benefits," RBC analyst Tyler Broda said. A win for Sibanye, which has mines in SA, Zimbabwe and the US, was the improvement in its debt metrics and compliance with its debt covenants, which is under scrutiny by investors and analysts after the company loaded itself with R23bn in debt to fund the $2.2bn cash purchase of Stillwater Mining in the US in 2017. Sibanye’s debt...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.