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Gold miner Pan African counts on gold price to maintain strong growth, says CEO

Wed, 16th Sep 2020 17:23

* Firm could maintain growth if gold price is steady

* Company to be debt free by June 2021

* Weak rand against dollar natural hedge for gold miners

JOHANNESBURG, Sept 16 (Reuters) - South African gold miner
Pan African Resources could maintain its
strong rate of profit growth and dividend payout in the current
financial year if gold prices remain at current levels, its
chief executive Cobus Loots said on Wednesday.

Pan African, which produced around 180,000 ounces of gold
metal last year to beat its own guidance, posted a 92.4%
increase in its headline earnings per share (HEPS) - South
Africa's main profit measure - to 2.29 U.S. cents for the year
ended June 2020, it said in a statement.

"The earnings growth had been on the back of much lower gold
prices that were there most part of last year. If gold prices
are resilient, then that bodes well," Loots told Reuters in an
interview.

He did not want to comment on specific numbers but said the
momentum could be continued.

Pan African will pay a final dividend for the year at 312.9
million rand ($19.21 million), more than six times what it paid
out last year.

Record gold prices, which surpassed the milestone of $2000
per ounce early August, have given a lifeline to South African
gold miners, and have been helped by a weak currency.

Gold prices rose by up to 28% in the last fiscal year while
the rand depreciated against the dollar by around 18%. This made
the local currency production cost of the metal cheaper, while
while the selling price, in dollars, was higher.

The company aims to be net debt free by June 2021, the
41-year old chief executive of the mining company said.
(Reporting by Promit Mukherjee;Editing by Elaine Hardcastle)

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