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:
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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
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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