Pan African Resources PLC
Annual Report 2009

Plain-text annual report

The African Focused Gold Mining Company Annual Report 2009 Table of Contents Introduction 1 2 3 4 5 Nature of Our Business Salient Features Share Statistics & Shareholding Geographic Location Company Structure Commentary 2009 8 10 Chairman’s Report Chief Executive Officer’s Review Review of Assets 20 26 30 34 Mining Operation: Barberton Mines (Pty) Ltd (‘Barberton Mines’) Near-Term Production: Phoenix Platinum Mining (Pty) Ltd (‘Phoenix Platinum’) Growth Project: Manica gold project (‘Manica’) New Business Mineral Resource Management 38 39 40 Group Mineral Resource Management Qualifying Statements & Analysis Quality Assurance & Quality Control (‘QAQC’) Corporate Governance 44 46 47 48 Board of Directors Executive Management - Pan African Resources Executive Management - Barberton Mines Corporate Governance Financial Statements 56 59 60 62 63 64 65 66 Directors’ Report Statement of Director’s Responsibilities Independent Auditors’ Report Consolidated & Company Income Statements Consolidated & Company Balance Sheets Consolidated & Company Cash Flow Statements Consolidated & Company Statements of Recognised Income Notes to the Financial Statements Additional Information 104 108 Insert Notice of AGM Glossary of Terms Form of Proxy Pan African Resources PLC (hereinafter referred to the “Company’, ‘Pan African Resources’ or ‘Pan African’) (Incorporated in England & Wales under the Companies Act 1985 with registration number 3937466 on 25 February 2000) Share code on AIM: PAF (Primary listing) Share code on AltX: PAN (Secondary listing) ISIN: GB0005300496 Pan African is a gold mining Group that produces approximately 100,000oz per year. Its focus is on developing low cost, high margin production or near production projects. The Group is largely debt free, is unhedged and is able to fund all of its current on-mine capital from internal cash flows. Investment Focus: Production and growth focus driven by: • • • Low cost base; High margins; and Significant potential for long term growth in reserve base. Resilient financial performance Continued production improvement from the Barberton mining operations Acquisition of a further low cost / high margin mining project √ √ √ √ √ √ √ √ √ √ √ √ √ Headline earnings per share growth of 64% to 0.85p (2008: 0.52p) ‡ Earnings per share decreased by 30% to 0.40p (2008: 0.52p) EBITDA increased by 67% to £22.9 million (excluding impairment) (2008: £13.7 million) Dividend of 0.02555p declared Total cash cost decreased by 1.42% to US$469/oz (2008: US$: 476/oz) Gold sales increased by 35% to £53 million (2008: £39.3 million) Underground gold production increased by 15% to 94,909oz (2008: 82,436oz) Headgrade improved by 16% to 10.32g/t (2008: 8.9g/t) Proven and probable reserve base increased by 26% to 619,000oz (2008: 490,000oz) Acquired 100% of the Phoenix Platinum processing project for £5.2 million (NPV of £27.6 million) Test work confirmed higher than anticipated 4PGE grades of between 2.1g/t and 3.0g/t Cash cost of

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