EXXARO Resources CEO, Mxolisi Mgojo is to relinquish his role a year early paving the way for CEO in waiting Nombasa Tsengwa to lead the company from August.
In terms of succession plans announced in March last year, Mgojo was to step down on May 31, 2023 when he reached the retirement age of 63.
Tsengwa joined the former Kumba Resources as general manager for safety, health and environment in 2003 and became directly involved in operational management from 2010 when she was appointed GM of Exxaro’s tied coal and Mpumalanga operations. She was appointed executive head of coal operations in 2016.
Commenting in a trading statement today, the South African coal producer also said it had appointed Kgabi Masia as head of its minerals division. Masia was previously president of South32’s South African Energy Coal (SAEC) before it was sold to Seriti Resources.
Masia has additional experience in the production of manganese and aluminium and will help lead Exxaro’s stated strategic push into asset diversification.
The company said in September that the company intended to diversify into manganese, copper and bauxite production with the aim of cutting its reliance on earnings from coal. This would be through merger and acquisition activity, some outside of South Africa if it was successful buying bauxite. It said at the time “… deal movement [was] underway”.
According to a presentation by Tsengwa “… Our new Exxaro Minerals business could represent 50% of expected coal EBITDA (earnings before interest, tax, depreciation and amortisation) within 10 years”.
Exxaro is poised to post a strong performance for its 2022 financial year, the details of which will be presented to the market on Thursday. According to its trading statement, higher prices for export and domestic coal will more than offset a panoply of logistical difficulties posed by theft of overhead cables on the coal line.
Mgojo said at Exxaro’s interim results presentation last year that the performance of the rail’s owner and operator, the state-run Transnet, had been the worst he had witnessed. Coal export sales plunged 30% to 4.1 million tons (Mt) in the six months to end-June (six months to end-June 2020: 5.9Mt).
Kumba also benefited from an outstanding performance of Kumba Iron Ore in which it has an indirect stake through a 20% stake in subsidiary company, Sishen Iron Ore Company. Kumba paid out all of its record earnings on surging iron ore prices.
Exxaro’s headline earnings per share for the 12 months ended December would be 50% to 60% higher year-on-year.
