Cobus Loots

ANOTHER year but the same old story as the Pan African share price stubbornly refused to perform despite the gold price going through the $2,000-per-ounce mark several times during 2023 and the rand gold price going as high as R1.2m per kilogram. By mid-December the Pan African share price at 395c was pretty much where it started the year in January at around 370c while Gold Fields was up 64% over this period and DRDGold 36% higher. That underperformance may lie behind the action of half of Pan African’s shareholders who voted at the AGM in November to reject the company’s executive pay scheme.

In terms of the 2023 scheme Loots will get paid a total remuneration of $2.07m compared with $1.4m under the 2022 implementation plan. Clearly Loots getting a 48% pay rise while the share price underperforms is sticking in shareholders’ craws. The main problem last year was that Pan African fell short on its production guidance which it was forced to revise to 175,000 ounces for the year to June from the previous estimate of 195,000 to 205,000 oz. Loots expects a recovery in financial 2024 to at least 180,000 to 190,000 oz following a bullish January production update with a further step-up in the 2025 financial year but that depends on the successful commissioning of the Mogale Tailings Retreatment plant at Mintails.

As of November, Loots was sounding upbeat with commissioning on track while the various operations were performing either in line with predictions or beating those predictions. Mintails is expected to start production at the end of 2024 and add some 50,000 oz/year to group production boosting total annual output by about 25%.