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“Our greatest growth opportunities are in Zimbabwe and Canada. Probably, at the right time, we would look at the potential processing capacity in Zimbabwe as a means of promoting further potential growth in the future, ”he said.
In Canada, its newly acquired mining operations will switch to a higher proportion of higher grade ore from underground mining rather than open pit material, as the crushing and grinding circuit is optimized to handle 12,500 tonnes of material per day from the 10,000 tons today, Muller said.
There is no M&A prospect, certainly not in SA, Muller said, noting that Implats will spend capital on its 20 existing wells to improve them and extend their lives.
Implats will shut down an old well before the end of 2020 because it had depleted its ore body, he said. Its number 1 well near Rustenburg had a useful life of three years, but that could be increased to eight years if the board decided to invest in underground development.
Implats returned large dividends after a six-year hiatus despite losing R4.9 billion in revenue due to disruptions from the Covid-19 pandemic during the year through the end of June. It reported an after-tax profit of R16.5 billion compared to R1.2 billion the previous year.
The company declared a final dividend of rand 4 per share, bringing the 2020 total return to shareholders to rand 5.25 per share. Implats last paid a dividend in 2013, returning a total of 95 cents per share. In 2012, she paid R1.95.
Implats reported that sales of the six metals it produced fell 8% to 2.8 million ounces due to restrictions around mining operations in South Africa and Canada to contain the pandemic.
Implats expects its 2021 refined production, which will include inventory release, to be between 2.8 million and 3.4 million ounces.
Free cash flow of R14.4bn was generated during fiscal 2020 after Implats invested R4.2bn in its 20 wells. It was left in a net cash position of R5.7 billion at the end of the year.
Group revenue increased 44% to R69.9 billion, and the rand price received for the six metals produced increased nearly 60% to R24,863 / oz as the dollar price of these metals rose and the rand weakened. .
Implats purchased the Canadian assets for R10.9bn in cash and debt, with R3.7bn of debt remaining related to the transaction.
“If palladium prices continue to rise, we anticipate paying off that debt as soon as possible. Then we will begin to repatriate funds to Implats to recoup our initial capital investment in the entity, ”said Implats CFO Meroonisha Kerber.
Despite the difficult six months, Impala Canada generated 1 billion rand of free cash flow, he said.
Implats wants to have R20bn in cash on its balance sheet to accommodate the vagaries in the global PGM market and operational disruptions, Kerber said. It has R13.3bn in the bank now, up from R8bn a year earlier.
