VALTERRA Platinum is to pay shareholders a special dividend of R5.3bn – R20 per share – taking its final dividend for the 2025 financial year to R11.5bn, equal to R43/share and representing 71% of headline earnings for the year.
A base cash dividend of R6.2bn, equal to R23/share, was declared in terms of Valterra’s payout policy of 40% of headline earnings. This takes the total dividend for the group’s maiden financial year since demerging from Anglo American to R45/share.
The payout is an extraordinary recovery in fortunes for Valterra, largely driven by an 89% improvement in platinum group metal prices in the second half of 2025 to finish the year at a basket price of $2,562/oz.
Valterra produced about 10% less PGMs in concentrate after an operationally tricky first half in which rains interrupted the group’s Amandelbult operations especially hard. However, the consequent reduction in matte and concentrate production, and lower refined production was partly offset by the release work-in-progress metal inventory.
PGM prices were higher in the year as a result of major investment demand. Some of this was stimulated by the opening of derivative trading in China (GFEX) and some reports of US stockpiling amid tariff threats from the Trump administration.
But there were specific demand-side factors affecting sentiment as well. The European Union and Canada (in the current financial year) have allowed more time for the adoption of battery electric vehicles which will therefore see longer-than-anticipated use of internal combustion engines and hybrid vehicles which is positive for PGM demand.
This optimism translated into a higher average realised price for Valterra’s metals. It reported a 26% and 22% year-on-year increase in the dollar and rand basket price of its metals to $1,852 and R32,611 per PGM ounce respectively.
Valterra has stripped out R6bn in capital costs and R12.3bn in operational costs over the last two years. Operational costs were R5bn lower in 2025, R1bn better than forecast. After absorbing for lower production from Amandelbult flooding, unit costs were contained to a 5% increase for the year under review.
Valterra posted 98% stronger headline earnings of R63.48/share for the year.
The balance sheet was also transformed from the interim period with cash flow surging, assisted by R2.5bn in Amandelbult-related insurance income. As of June 30, the group reported net debt of R4.9bn but by December 30 it was in net cash of R11.5bn.
More to come
“We expect the strong fundamental drivers to continue underpinning PGM prices over the medium to long term,” said Craig Miller, CEO of Valterra Platinum in commentary to the firm’s published numbers. “We move into 2026 with momentum, clarity and an unwavering focus on value creation,” he said.
Miller then told media in a call the company expected as much as a 240% year-on-year increase in free cash flow assuming the realised PGM rand basket price so far this year of about R42,000 to R43,000/oz was sustained.
Asked if the prospects were good for another outperformance on the payout, Miller said that “in line with our commitment to consecutive dividend declarations, you can expect us to maintain that through the remainder of the year”.
“We have realised R18bn in capital and cost efficiencies over 24 months, and the business is in really good shape. So, together with higher prices, we are going to be disciplined in how we return cash to shareholders,” he added.
“We believe the market should view this update in a positive light given the better-than-expected dividend and the continued positive operational momentum reflected in management’s guidance,” said UBS analyst Steve Friedman in a morning note. The bank has a buy rating and a target price of R210/share.
Shares in Valterra surged just over 11% in Johannesburg to trade at R176.50/share, a tripling in valuation in the last 12 months. “We continue to consider Valterra as one of the go-to stocks in the sector,” said Arnold van Graan, an analyst for Nedbank Securities.
