Announcements 2020

Interest payment notification – NHM009

Northam bondholders are advised of the following interest payment due on Monday, 26 October 2020:


Northam bondholders are advised of the following interest payment due on Monday, 26 October 2020:

Bond Code: NHM009
ISIN No: ZAG000158866
Coupon: 7.508%
Interest Period: 27 July 2020 to 25 October 2020
Interest Amount Due: R1 871 857.53
Payment Date: 26 October 2020
Date Convention: Following Business Day

Johannesburg
21 October 2020

Debt Sponsor
One Capital

Northam increases its Zambezi preference share holding to approximately 70% by acquiring R3.5 billion of Zambezi preference shares

Northam shareholders are referred to the announcement dated 18 August 2020 (“previous announcement”) pertaining to the acquisition by Northam of preference shares in Zambezi Platinum (RF) Limited (“Zambezi”) (“Zambezi preference shares”).


Northam shareholders are referred to the announcement dated 18 August 2020 (“previous announcement”) pertaining to the acquisition by Northam of preference shares in Zambezi Platinum (RF) Limited (“Zambezi”) (“Zambezi preference shares”).

Northam is pleased to announce that, since the date of the previous announcement, it has acquired an additional 37 179 697 Zambezi preference shares for a total cash consideration of approximately R3.5 billion (“ZPLP acquisitions”). Following the ZPLP acquisitions, Northam holds 111 909 248 Zambezi preference shares (“Northam owned prefs”), representing approximately 70% of all Zambezi preference shares in issue.

The face value of the Northam owned prefs as at 15 October 2020, calculated as the initial issue price of the Zambezi preference shares plus accumulated preference share dividends, amounts to approximately
R9.1 billion.

As stated in the previous announcement, Northam’s acquisition of Zambezi preference shares will reduce the preference share dividend expense and liability included in Northam’s consolidated financial statements, as well as Northam’s potential financial exposure under the guarantee it provided to holders of Zambezi preference shares, should the guarantee be called upon. Furthermore, should Zambezi elect to redeem the Zambezi preference shares through a distribution of ordinary shares in Northam (“Northam shares”) held by Zambezi, then the redemption of the Zambezi preference shares held by Northam, at such time, will result in a distribution of Northam shares to Northam, thereby reducing the number of Northam shares in issue.

The ZPLP acquisitions have been fully funded through Northam’s internal cash resources.

The ZPLP acquisitions are not categorised transactions in terms of the JSE Limited Listings Requirements and information relating thereto is provided for information purposes only.

Paul Dunne, Northam’s Chief Executive Officer said “Northam has continued to return significant value to shareholders by accelerating the purchase of Zambezi preference shares to the current 70% holding. This strategy will positively impact future earnings and earnings per share and will add to the success of our empowerment transaction. Furthermore, Northam no longer considers the back-up guarantee provided in favour of the Zambezi preference shareholders to be a dilution risk to Northam ordinary shareholders and this is a significant milestone for the Company. Our mines and operations have proved to be resilient following the COVID-19 induced national lockdown and the commitment demonstrated by the Northam employees in restoring operations to normality has been outstanding”.

Johannesburg
15 October 2020

Corporate Advisor, JSE Sponsor and Debt Sponsor to Northam
One Capital

Attorneys to Northam
Cliffe Dekker Hofmeyr Inc.

Interest payments notification – NHM006 AND NHM007

Northam bondholders are advised of the following interest payments due on Friday, 16 October 2020:


Northam bondholders are advised of the following interest payments due on Friday, 16 October 2020:

Bond Code: NHM006
ISIN No: ZAG000158577
Coupon: 7.1%
Interest Period: 16 July 2020 to 15 October 2020
Interest Amount Due: R2 208 227.57
Payment Date: 16 October 2020
Date Convention: Following Business Day

Bond Code: NHM007
ISIN No: ZAG000158593
Coupon: 7.6%
Interest Period: 16 July 2020 to 15 October 2020
Interest Amount Due: R2 704 582.15
Payment Date: 16 October 2020
Date Convention: Following Business Day

Johannesburg
13 October 2020

Debt Sponsor
One Capital

Upgrade to Northam’s long term and short term credit rating, with a stable outlook

Northam is pleased to advise shareholders and noteholders that the credit rating agency, Global Credit Rating Co. (“GCR”), has upgraded Northam’s national scale long term credit rating to A(ZA) (from the previous rating of A-(ZA)) and short term credit rating to A1(ZA) (from the previous rating of A2(ZA)), with a stable outlook .


Northam is pleased to advise shareholders and noteholders that the credit rating agency, Global Credit Rating Co. (“GCR”), has upgraded Northam’s national scale long term credit rating to A(ZA) (from the previous rating of A-(ZA)) and short term credit rating to A1(ZA) (from the previous rating of A2(ZA)), with a stable outlook.

The upgrade primarily reflects Northam’s strengthened earnings profile and expectations of continued robust free cash flows and financial metrics on the back of favourable commodity prices. Other factors sighted by GCR include, inter alia, the surge in Northam’s profitability over recent years enhanced by rising production volumes, the positive manner in which Northam managed and recovered from the impact of COVID-19, the group’s globally competitive cost position and Northam’s track record of maintaining conservative financial policies. GCR continues to view Northam’s liquidity as strong.

The stable outlook reflects GCR’s view that the group will pursue a conservative financial profile and will continue to benefit from its ongoing production ramp up against supportive pricing levels, which should translate into robust margins and cash flows to sustain strong credit metrics over the next 12 to 18 months.

GCR’s announcement in regard to Northam’s credit rating is available from GCR’s website at https://gcrratings.com/announcements/gcr-upgrades-northams-issuer-ratings-to-aza-a1za-onstrengthening- earnings-and-conservative-financial-profile-outlook-stable/.

Johannesburg
8 October 2020

Corporate Advisor, Sponsor and Debt Sponsor
One Capital

Release of annual financial statements of the guarantor

Northam wishes to advise Noteholders that the annual financial statements of Booysendal Platinum Proprietary Limited for the year ended 30 June 2020 and the auditor’s unqualified audit report thereon, are available for inspection, during office hours, at the registered office of the company.


Northam wishes to advise Noteholders that the annual financial statements of Booysendal Platinum Proprietary Limited for the year ended 30 June 2020 and the auditor’s unqualified audit report thereon, are available for inspection, during office hours, at the registered office of the company.

Johannesburg
2 October 2020

Debt Sponsor
One Capital

Notice of an acquisition of a beneficial interest in Northam securities

In accordance with section 122(3)(b) of the Companies Act, No. 71 of 2008, as amended, and paragraph 3.83(b) of the JSE Limited Listings Requirements, Northam shareholders are advised that the company has received notification that Coronation Asset Management Proprietary Limited, on behalf of its clients (“Coronation”), has acquired a beneficial interest in Northam securities (the “Acquisition”).


In accordance with section 122(3)(b) of the Companies Act, No. 71 of 2008, as amended, and paragraph 3.83(b) of the JSE Limited Listings Requirements, Northam shareholders are advised that the company has received notification that Coronation Asset Management Proprietary Limited, on behalf of its clients (“Coronation”), has acquired a beneficial interest in Northam securities (the “Acquisition”).

Following the Acquisition, Coronation now holds 5.03% of the total issued ordinary share capital of the company.

Johannesburg
14 September 2020

Sponsor
One Capital

Interest payments notification – NHM012 AND NHM015

Northam bondholders are advised of the following interest payments due on Monday, 14 September 2020:


Northam bondholders are advised of the following interest payments due on Monday, 14 September 2020:

Bond Code: NHM012
ISIN: ZAG000160136
Coupon: 7.692%
Interest Period: 15 June 2020 to 13 September 2020
Interest Amount Due: R584 332.79
Payment Date: 14 September 2020
Date Convention: Following Business Day

Bond Code: NHM015
ISIN: ZAG000164922
Coupon: 7.242%
Interest Period: 15 June 2020 to 13 September 2020
Interest Amount Due: R9 027 698.63
Payment Date: 14 September 2020
Date Convention: Following Business Day

Johannesburg
9 September 2020

Debt Sponsor
One Capital

Listing of tap issue – NHM016

The JSE Limited (“JSE”) has granted approval for the listing of a tap issuance of NHM016 Senior Unsecured Floating Rate Notes (“Notes”), issued under the Northam Platinum Limited ZAR10 000 000 000 Domestic Medium Term Note Programme, dated 3 August 2012, as amended and supplemented from time to time (“Programme”), as guaranteed by Booysendal Platinum Proprietary Limited, with effect from 7 September 2020.


The JSE Limited (“JSE”) has granted approval for the listing of a tap issuance of NHM016 Senior Unsecured Floating Rate Notes (“Notes”), issued under the Northam Platinum Limited ZAR10 000 000 000 Domestic Medium Term Note Programme, dated 3 August 2012, as amended and supplemented from time to time (“Programme”), as guaranteed by Booysendal Platinum Proprietary Limited, with effect from 7 September 2020.

The details pertaining to the tap issue of NHM016 series are as follows:

Instrument Type: Senior Unsecured Floating Rate Notes
Total Notes in Issue: ZAR5 806 715 839.00 including this issue
Instrument Code: NHM016
Tranche Number: 3
Nominal Amount: ZAR165 966 845.00
Issue Price: 100.573288%
Interest Rate: 3 Month ZAR-JIBAR plus 425 bps per annum
Interest Rate Determination Date(s): 11 August, 11 November, 11 February, and 11 May (or the first Business Day of each Interest Period) of each year until the Maturity Date
Coupon Rate Indicator: Floating
Issue Date: 7 September 2020
Interest Commencement Date:
Maturity Date:
Final Redemption Amount:
11 August 2020
11 May 2025
100% of Nominal Amount
Last Day to Register: By 17h00 on 31 July, 31 October, 31 January and 30 April of each year until the Maturity Date or if such day is not a Business Day, the Business Day before each Books Closed Period
Books Closed Period: 1 August to 10 August, 1 November to 10 November, 1 February to 10 February and 1 May to 10 May of each year until the Maturity Date (all dates inclusive), or if any early redemption occurs, 10 Days prior to the actual Redemption Date
Floating Interest Payment Date(s): 11 August, 11 November, 11 February, and 11 May of each year until the Maturity Date, or, if such day is not a Business Day, the Business Day on which interest will be paid, as determined in accordance with the Applicable Business Day Convention
ISIN: ZAG000167750
Business Day Convention: Following Business Day
Other: The applicable pricing supplement (“APS”) contains additional terms and conditions to the Terms and Conditions as contained in the Programme, (“Additional Terms and Conditions”)
Summary of Additional Terms and Conditions: The Additional Terms and Conditions pertain to the applicable guarantee and the amendment of Condition 16.1 (Senior Notes) by including additional Events of Default in terms of Condition 16.1.1.9 (Other) of the Terms and Conditions. Investors should refer to Appendix “A” of the APS for full details of the Additional Terms and Conditions, available on Northam’s website: https://www.northam.co.za/downloads/send/96-files/1319-applicable-pricing-supplement-nhm016-04-september-2020

The Notes will be immobilised in the Central Securities Depository (CSD) and settlement will take place electronically in terms of JSE Rules.

Johannesburg
4 September 2020

Sole Arranger, Dealer and Debt Sponsor to Northam in respect of the Notes
One Capital

Attorneys to Northam, the Arranger and the Dealer in respect of the Notes
Bowman Gilfillan Inc.

Interest payment notification – NHM013

Northam bondholders are advised of the following interest payment due on Wednesday, 9 September 2020:


Northam bondholders are advised of the following interest payment due on Wednesday, 9 September 2020:

Bond Code:

NHM013

ISIN:

ZAG000162181

Coupon:

6.342%

Interest Period:

9 June 2020 to 8 September 2020

Interest Amount Due:

R81 525.11

Payment Date:

9 September 2020

Date Convention:

Following Business Day

Johannesburg
4 September 2020

Debt Sponsor
One Capital

Another record year for Northam

Johannesburg, 28 August 2020.  Northam Platinum has issued its annual results for the year ended 30 June 2020.  The following documents, making up the suite of 2020 published reports, are available on the Northam website at www.northam.co.za for review. 


…COVID-19 challenges notwithstanding…

Johannesburg, 28 August 2020.  Northam Platinum has issued its annual results for the year ended 30 June 2020.  The following documents, making up the suite of 2020 published reports, are available on the Northam website at www.northam.co.za for review. 

The suite of reports includes:

KEY FEATURES FOR THE YEAR

  • Record revenue of R17.8 billion
  • Record operating profit of R5.3 billion
  • Estimated COVID-related production loss of 108.7 koz 4E
  • Net debt contained to R3.3 billion
  • First production of ~35 koz from Eland
  • ZPLP ownership at 46.7% (R6.0 billion market value)

Speaking to the investment community today, chief executive Paul Dunne commented on the significant impact of the COVID-19 pandemic. “At our operations we have lost five employees to the virus, one of these being a contractor employee. We recognise that premature and unexpected loss of life can have a devastating impact and our sincere condolences go out to the families of the deceased.

“Our operations were badly affected by the national lockdown and phased restart. It is testament to the efforts of mine management, working closely with organised labour and the regulators, that we limited this impact, restarting operations in a safe and sustainable manner.”

As a response to the pandemic, Northam has prioritised the health and well-being of its employees and host communities, and developed an action plan to minimise the social and economic impacts, which comprised:

  • Paying employees and protecting their jobs
  • Implementation of comprehensive health measures and safety protocols to reduce the potential for infection
  • Driving towards operational normalisation, maintaining a focus on safe and sustainable production - Booysendal and Eland are back at full production and Zondereinde is getting there
  • Managing the company’s cash position by trimming capex and restructuring our DMTN programme.

The direct cost estimate of COVID-19 is approximately R1 billion. In order to assist with COVID-19 relief efforts Northam donated funds to the group’s two community trusts.

PERFORMANCE REVIEW
Metal production was flat year on year at 515 370 oz 4E, given the COVID-19 related loss of more than 100 koz, which effectively neutralised the record H1 production levels. However, on the back of a 67.4% increase in rand denominated basket prices, revenue reached a record high of R17.8 billion.  This translated into record operating profit of R5.3 billion and record EBITDA of R6 billion. Net debt was contained to R3.3 billion, and the net debt to EBITDA ratio was held well within the target of 1:1.

The average US dollar sales prices achieved during the year under review improved for most metals.  Palladium and rhodium both performed well, increasing by 52.4% and 169.8%, respectively.  Both these metals continued their upward trends subsequent to the financial year end. Platinum however, making up roughly 60% of the sales volume of Northam’s precious metals 4E basket, continues to be the laggard. The average price achieved during the year was USD858/oz (F2019: USD824/oz), which impacted the 4E basket price achieved. Platinum now only contributes 28.0% (F2019: 46.3%) to the 4E basket. Any upward movement in the platinum price will have a positive impact on the profitability of the group.

Now in the fourth phase of its strategic journey of developing low-cost long-life quality assets, Northam has continued to purchase Zambezi preference shares during the year, and post year end. Its current holding is 46.7% of all shares in issue, and the current value is R5.6 billion which is effectively a value return to shareholders.

Group operational overview
The group’s equivalent refined metal from own operations fell by 0.9% to 515 370 oz 4E (F2019: 519 954 oz 4E. This is 108 685 oz 4E below target and is directly related to the losses associated with the lockdown and the restart of mining activities.

The brunt of losses was felt at the conventional Zondereinde mine; the mechanised Booysendal mine recovered well and group losses were partially offset by additional processing of surface sources at Eland mine.

Group unit cash costs per equivalent refined platinum ounce increased by 28.2% to R29 281/Pt oz. This increase in unit cash cost is the result of the high fixed cost component of underground mining, allied with the production losses incurred.

Total group capital expenditure reduced year on year to R2.4 billion, owing to planned cutbacks and project completion. A decision to temporarily scale back on specific growth projects in the interest of liquidity management was made after the onset of the COVID-19 pandemic.

Projects that have been temporarily scaled back include;

  • the Central Merensky module at Booysendal mine,
  • aspects of the number 3 shaft project at Zondereinde mine and
  • the stoping build-up at Eland mine.

Despite the decision to reduce growth capital spend, the group continues to deliver on its strategy of developing low-cost, long-life assets in order to position itself at the lower end of the industry cost curve.

Scale backs have been structured to minimise the impact on project critical paths. As such, the overall impact on the group’s growth is limited.

At Zondereinde mine, stoping is ramping up within the western extension section and further progress has been made on the deepening project. The pilot hole for the planned number 3 shaft has been completed and reaming to ultimate shaft diameter will commence during the first half of F2021. At the metallurgical facilities, upgrades to the material handling infrastructure are nearing completion. The coming years will see work start on capacity increases at both the original smelter furnace and the base metal removal plant.

The development of Booysendal South is progressing on schedule and on budget, with surface infrastructure construction almost complete and underground development at the UG2 mine on track. Work on the North aerial rope conveyor is continuing, but COVID-19 related stoppages have led to planned commissioning being delayed to December 2021. North Merensky mine build-up will continue.

At Eland mine, processing of surface materials has out-performed budget and will continue. Development of the Kukama decline system has progressed well. An early mining demonstration is ongoing, as is strike development to connect with the Maroelabult section. Despite the decision to pull back on stoping build-up, primary development at Eland mine will continue.

In conclusion
Going forward, Northam guided to PGM production in the range of 650 koz to 670 koz 4E with unit cash costs to be between R28 500 and R29 000/Pt oz, for the next two years. Sales will follow production and will allow for the number 1 furnace rebuild scheduled this year. The capital forecast, for both F2021 and F2022 is estimated at between R2.3 billion and R2.5 billion. At current rand basket price levels the company should generate healthy cash flows.

Paul Dunne pointed to a second meaningful ramp up in production, predominantly coming from the Booysendal South mine. “Growth from all operations will contribute to our medium-term annual production target of 1 million oz 4E over the forecast period.”

Issued by R&A Strategic Communications, Johannesburg, Tel +27 (0)11 880 3924;

Marion Brower +27 71 493 0387; Taryn van Olden 079 527 6882