JOHANNESBURG (miningweekly.com) –  Soon-to-be renamed Anglo American Platinum is being positioned to be as competitive as possible for the long term and to deliver on its full potential for all of stakeholders, CEO Craig Miller made clear on Monday, when the company that will become independent of Anglo American in June as a rebranded entity seizes the opportunity to focus on simplicity, clarity and operational efficiency by leveraging on strong expertise in mining and processing.

“As we embark on this new chapter following the demerger, we're excited to become an independent fit-for-purpose PGM company,” an upbeat Miller reiterated when he and CFO Sayurie Naidoo reported 4%-higher annual sales volumes to 4.1-million platinum group metals (PGM) ounces and 2% lower unit cost to R17 540/PGM ounce.

“I really do believe that through the world-class portfolio of assets that we have, we'll be able to extract the value.

“As an independent company, we'll be able to invest in those PGM assets that we have, and we'll be able to do that in a sustainable way.

“Clearly, we’ll have the agility and the opportunity to continue to drive the operational excellence, which I fundamentally believe is so important to ensure our sustainable future.

“Not only will we invest in the assets, we'll continue to progress market development opportunities where we can grow demand for the products that we produce.

“We're going to incorporate sustainability to everything that we do from the position of energy, of climate change, ethical value chain, as well as supporting our local community through the value that we create.

“We will be renaming Anglo American Platinum in due course and in advance of the demerger, we will announce a name change.

“We're not in a position to do that now, so I think we'll let you know as soon as it's out there.

“In terms of our location, certainly as part of being listed on Johannesburg Stock Exchange, we’re very firmly part of South Africa, we absolutely expect to remain here in Johannesburg, and we'll look for office space as and when it's required.

“But as you can imagine, our office space is not necessarily front and centre of our priorities given all the other work that we have underway, but I'm absolutely confident that we'll continue to work with Anglo American and potentially even be in the same building as them going forward. It is an option, but we'll make sure that it's appropriate for us as an organisation,” Miller outlined in response to journalist questions at a media conference covered by Mining Weekly.

A capital market day will be hosted in March and an investor roadshow will be conducted to engage all stakeholders on strategic focus areas as well as how targets and objectives will continue to be met.

Naidoo forecast that for the coming year, all assets would be cash generative on the back of action plan and cost-reduction work done.

“We expect by the end of the year, we'll still be in a cash neutral position, even after paying out the R16.5-billion dividend.

“We model this on various price scenarios, and we still believe we'll be able to execute on our strategy, and follow our disciplined capital allocation framework, continue to invest in sustaining capital, remain committed to the base dividend and still have cash to invest in our discretionary capital,” added Naidoo in response to journalist questions.

Dedication to operational excellence to help expand cash flow margin was highlighted.

“We'll invest in our portfolio to sustain profitability and target revenue growth from our world class resource endowment, with a strong emphasis on value over volume,” said Miller.

Mining Weekly: What will be the main drivers of demand for platinum group metals going forward, and the outlook for supply?

Miller: I continue to believe that PGM will continue to be utilised in mobility and in other industrial applications. And so if we think through mobility, from an automotive perspective, two-thirds of our demand comes from that sector. You’ve seen the energy transition still taking place, but it's going to take place potentially at a slower rate, given some of the issues that we’ve seen globally, and therefore that continues to support the utilisation of PGM, either in catalytic converters or in catalytic converters in hybrid vehicles. That's an important demand segment, certainly in the medium term. Then longer term, as we achieve that energy transition, I do believe that platinum and some of the other PGMs have a role to play in fuel cell electric vehicles and therefore really supporting clean energy mobility into the future, as well as in the generation of green hydrogen.

And what does supply look like?

If we maintain the level of production that we achieved back in 2023, supply is relatively stable from primary producers. There are some cutbacks in production in North America, from Stillwater. But I think that the biggest area where supply has not necessarily materialised is in recycling versus sort of the estimates. So, we anticipate, as a result of that, that platinum, palladium and rhodium were in deficit in 2024 because demand was greater than supply, and we think that that's going to continue to 2025, with palladium moving into potential surplus in 2026, while platinum and rhodium remain in deficit for the foreseeable future.

KEY YARDSTICKS

Last year, metal-in-concentrate production reduced by 7% to 3.6-million ounces following the transition of Kroondal to a four element tolling arrangement.

Refined PGM production increased by 3% to 3.9-million ounces through the drawdown of work-in-progress inventory built up from prior years.

Annual cost savings totalled R12-billion, well up on the 2024 target of R10-billion.

All-in sustaining cost was cut by 13% to $986/oz and well below the targeted $1 050/oz

The operating free cash flow of R14.6-billion was significantly up on the R3.2-billion in 2023, with the net cash position of R17.6-billion at year-end including customer prepayment.

Ahead of the demerger, an independent capital structure will be established that is consistent with commitment to maintain a balance sheet able to support the delivery of strategic priorities and allow shareholders to participate in value creation.

SAFETY INTENSIFIED

The commitment to eliminating fatalities and achieving zero harm in the workplace is the most important priority.

“We are deeply saddened by the three tragic work-related fatalities experienced during the year at Amandelbult's Dishaba mine.

“As a result of these tragedies, we initiated a call to action across the company to prevent any reoccurrences.

“This included two self-imposed stoppages in the second half of 2024 at Dishaba mine, during which independent audits were conducted and lessons learnt shared and implemented across the organisation,” Miller pointed out.