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Pan African Resources (AIM: PAF)

Last close As at 22/11/2024

GBP0.36

▲ 0.10 (0.28%)

Market capitalisation

GBP697m

Pan African Resources (PAF) has four major producing precious metals assets in South Africa: Barberton (target output 95koz Au pa), the Barberton Tailings Retreatment Project, or BTRP (20koz), Elikhulu (55koz) and Evander underground, incorporating Egoli (currently 30koz, rising to >100koz).

Our core valuation of PAF is 40.93 US cents per share, based on projects either already in production or sanctioned at a long-term (real) gold price of US$1,794/oz. However, this rises by 54–67% if other assets (eg Egoli) are also taken into account, while historical P/E ratios imply a value of 44.70p in FY25 and 41.17pp in FY26 and its peers imply valuations of 61.03p and 43.33p (respectively).

Latest Insights

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Metals & Mining | Update

Pan African Resources — Tennant Creek acquisition

Metals & Mining | Update

Pan African Resources — Analysing H224 and looking forward to FY25

Metals & Mining | Update

Pan African Resources — Hitting expectations

Metals & Mining | Update

Pan African Resources — An accounting storm in a legal teacup
Pan-African-Resources_resized
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Equity Analyst

Lord Ashbourne

Lord Ashbourne

Director of Content, Mining

Key Management

  • Cobus Loots

    CEO

  • Deon Louw

    FD

  • Keith Cousens Spencer

    Chairman

Balance Sheet

Forecast net debt (US$m)

125.8

Forecast gearing ratio (%)

25

Share Price Performance

Price Performance
% 1M 3M 12M
Actual (3.7) 17.5 132.1
Relative (0.3) 20.5 114.8
52 week high/low 37.8p/15.2p

Financials

On 5 November, Pan African Resources (PAF) announced that it is to acquire privately owned Tennant Consolidated Mining Group (TCMG) in Australia’s Northern Territory for a total consideration of US$54.2m in an all-share deal that involves it issuing an additional 125.4m shares (or 6.5% of its existing share capital). The acquisition price equates to an undemanding US$42.15 per resource ounce of gold or US$139.21 per reserve ounce. While we expect the acquisition to have little effect on PAF’s earnings in FY25 (apart from the increase in share capital), we estimate that it will increase FY26 earnings by US$24.6m (or 19.1%) and FY27 earnings by US$42.6m (or 29.6%) and, on this basis, will undoubtedly be accretive.

Y/E Jun Revenue (US$m) EBITDA (US$m) PBT (US$m) EPS (c) P/E (x) P/CF (x)
2023A 321.6 121.9 92.9 3.54 13.3 6.8
2024A 373.8 150.9 119.8 4.68 10.1 6.7
2025E 459.3 238.0 190.5 7.09 6.7 5.5
2026E 597.7 276.8 207.1 7.51 6.3 3.4

Research

Update

Metals & Mining

Pan African Resources — Analysing H224 and looking forward to FY25

Update

Metals & Mining

Pan African Resources — Hitting expectations

Metals & Mining

Update

Pan African Resources — Tennant Creek acquisition
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Thematics

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Metals & Mining

Shades of the 1970s

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Metals & Mining

Critical minerals: The investment vacuum
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thematic

Metals & Mining

Lithium’s adolescence

thematic

Metals & Mining

Lepidico: Offer closes, oversubscribed
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