Edison Investment Research - Pan African Resources PLC (PAF) Pan African Resources - Taking the rough with the smooth

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Edison Investment Research

Alison Turner

Pan African Resources - Taking the rough with the smooth

In its operational update, released last week, Pan African Resources (PAF) reduced its production guidance for FY23 by c 12.5% from 195–205koz to 175koz. The reduction was due to instability and disruptions in the electricity supply to PAF’s operations (c 10koz), a slower ramp up to continuous operations at Barberton and faulting at the Kimberley reef at Evander, coupled with a delay in transitioning to full production at 24 Level. In addition, we anticipate that PAF will record a small loss of US$5.3m on account of the synthetic forward sale of ounces announced in February regarding its Mintails financing. However, these effects have also been mitigated by a weak rand and a strong gold price such that, while we have reduced our FY23 normalised EPS forecast by 8.4% (from 4.17c/share to 3.82c/share) our core valuation of PAF has risen by 4.8% (see below).

30/05/2023 1 EN

Underlying

Pan African Resources PLC

Pan African Resources is a mid-tier African-focused precious metals producer. Co.'s business activities were conducted through the following business segments: Barberton Mines (including Barberton Tailings Retreatment Plant), located in Barberton, South Africa; Evander Mines (including Evander Mines' Tailings Retreatment Plant), located in Evander, South Africa;Corporate; and Pan African Resources Funding Company Proprietary Limited.

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GB0004300496 London Stock Exchange United Kingdom

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Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Alison Turner

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Pan African Resources - Taking the rough with the smooth

Pan African Resources: 2 directors

Pan African Resources - A happy valentine

Pan African Resources - Anticipating a happy valentine

Basilea Pharmaceutica - Cresemba milestone payments continue to roll in

AAC Clyde Space - Solid start to the year with further order growth

Tinexta - Typical seasonality in Q124

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