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Hi Mike

Your profit figures are very close to mine with similar assumptions.

I agree also re PE. I’d be surprised if we were valued at 12x next years profits unless gold price continues to rise. Should that happen who knows what happens to the share price

I also noticed the AISC discrepancy - slightly worrying to make such a mistake.

My sense though is that the share price will continue to rise nicely , esp. if we get some good broker recommendations. I’d be disappointed if we are not comfortably over £1 in the next six months. Doubling over the next 12 months is certainly doable with a fair wind.

I’m looking forward to hearing what Mike thinks next year’s results will be. Forecasts are obviously fancy guesswork, but we’ve got some very useful clues in production guidance and AISC. The early RMS, which now seems to disappeared, was accompanied by masses of very helpful figures. I haven’t tried to go deep into them and do lots of detail modelling; simply prepared a very high-level shy.

If gold is able to hold its current price, sales were to be of the order of 275,000 oz, and protection costs were in line with management estimates, we would see very big increase in pre-and post tax profits next year. My figure for post tax profits is c. $350 million. At current PE’s (about 11), this would imply a share price heading towards towards £2. Knowing what PE ratio to use is a bit tricky. We are lower and some of our competitors, but the higher ratios are also in anticipation of rising profits. It may well be that the PEs will come back and not be as high in 12 months time.

Lots of ifs, buts, maybes and caveats.

Please, somebody else do the sums rather than relying on me. Easy to make a mistake.

Regardless of the exact numbers, it’s hard to think this stock doesn’t have a lot further to go.

The RNS was there at 7.05 and has now disappeared. very strange.

Thanks Mike. It’s good to challenge each other. We don’t want an echo chamber where we simply parrot the same views. I always look forward to reading what you write.

We’ll know more tomorrow, but I feel a jump in anticipated profits in 26 plus a much higher PE could result in a substantial price hike over the next 12 months. Lots of ifs and buts, of course.

Thanks Mike.

As you note, the key, beyond future profitability, is the PE ratio.

As you note, we look very low relative to other miners. Let’s see what tomorrow holds and then whether your “forecast” looks solid. We can then look at comparative PE ratios and that will give us a good sense of the potential future share price.

My sense remains that this stock still has a lot of upside - comfortably over £1 - turbo charged by yesterday’s news about a main listing. Let’s hope the brokers (by whom I’m not entirely convinced) put together compelling forecasts which will entice new institutional shareholders. I’ve always felt they’ve been too cautious with their price targets.

Us putting together a forecast for next year will be much easier once we’ve seen the 2025 results and stripped out the effects of the hedge and the curious accounting for the Australian acquisition. These confuse we long-term holders, let alone people thinking about buying the stock.

It’s also evident that the rising gold price has raised all gold mining stocks – the rising tide raising all boats phenomenon. I remain convinced that PAF is a diamond (excuse the metaphor) amongst gold shares and that we deserve a comparative re-rating regardless of the increasing gold price. I’m hoping that will occur over the next 6 to 12 months as the results of (the excellent) management efforts and strategic diversification into Australia become evident. From what I can judge, we still look cheap relative to many gold mining stocks.

Normal caveats supply – we still have a lot of dependency on the basket case that is South Africa so things can go wrong. But all the signs are incredibly promising, even if gold were not to increase by another dollar.

Would someone who understands these matters please explain to me why we sometimes get violent price movements at the end of the trading day? Today is a great example: the price ay which the shares were trading as the market closed were suddenly marked back by trade which seem to have occurred a couple of hours earlier.

Other than this, it was a great day.

Fingers firmly crossed for Wednesday

As I’ve argued on these posts, this is great news for the stock. I believe worth at least another 10 or 20% over time.

Headlines from the announcement:

INTENTION TO MOVE FROM AIM TO LONDON MAIN MARKET

Pan African is pleased to announce its intention to apply for the Company’s ordinary shares ……. to be admitted to …….the (London) main market for listed securities….

Pan African, guided by a highly experienced management team, has delivered consistent commercial and financial success since its listings on the AIM Market ……underpinned by substantial production growth.

With its current portfolio of high-margin, quality operations across South Africa and Australia, the Company is on track to increase annual gold production for the financial year ending 30 June 2026 (’FY26’) to between 275,000oz and 292,000oz, an increase of approximately 40% compared to the production for the financial year ended 30 June 2025 …..

The Group’s gold production is completely unhedged from 1 July 2025, and able to fully benefit from the current record high gold prices……

Pan African’s Board of Directors believes that the proposed move to the Main Market could enhance the Company’s corporate profile and broaden the Company’s access to a wider pool of UK and global investors, supporting its next phase of growth……

Great analysis, Mike.

I think you’re in the right ball park. Will be able to have an even better estimate once we see the year end figures on September 10.

The only matter we differ on is that I would push for a main market listing; it shouldn’t take too much management time and my sense is we would get much better institutional backing once it was done. We are doing well as we are; my belief is that a full listing would mean doing even better…..🤞🏻

As was also noted below, we will soon be 1/4 of the way through the year. Management should soon have a good feel for whether the Australian production is on target and therefore for the total production for the whole year - subject, of course, the usual caveats

I’m looking forward to reading your estimate for 26, Mike……. ☺️

Disappointing drop today. But the stock has been nothing if not volatile.

Thanks, Mike. I’ve been looking at it as well. What I find encouraging is the pointers towards 26. Compare this years average sales price of $2735 to c. $3500 /oz and volumes increasing from 197,000 to c 275,000+ and we have the makings of a bumper 2026. Obviously lots of ifs and buts, but potentially tremendous once Australia comes on stream and if the gold price holds up.

If you’re correct about the main market, that is wonderful news. I’m very confident that the board are aware of the issue and the sense I have gained is they are minded to move in that direction. I emphasise, I don’t know what is happening. But I do know they are aware of the issue and understand it.

I’m completely guessing, but I believe that if the company were to move to the main market, it would immediately give the shares a material % upward bump.

For what it’s worth, I think you are correct, Patryk. I foresee £1 as well within range. This year’s results of next year‘s forecast, as we keep saying, will be very important. Let’s hope we are happy. It’s definitely fingers crossed time at the moment.

As I’ve repeatedly said, management are excellent but their communications have been poor. There’s a story here that could be told so much better than it has been. That’s so far to the advantage of we shareholders who bought early, but we now need management to provide a professional, clear compelling story to underpin the share price and help drive it forward.

If my memory serves me correctly (which often doesn’t), the tax question was raised at the AGM last year. I don’t think there was a satisfactory answer. I normally prefer dividends over share buy- backs, but in this case it would be better to have share buy- backs.

If the company were to go onto the main market, as wondered about yesterday, then maybe this would also trigger a solution to the tax problem?

Out of curiosity, I started plotting the progress of four gold miners on August 4 – exactly 1 month ago

PAF. UP 22.7%

AGI. UP 25.6%

KGC. UP 25.9%

NEM. UP 20.2%

No science in the selection., other than I think they’re reasonably pure gold miners.

The sector is on fire. Our rise isn’t exceptionally and nothing to do with the impending results. Everything to do with the market waking up to the fact that it current goal prices, these miners will be printing money.

You’re right about the basic steps, Waterloo.

I haven’t read anywhere that the company is contemplating moving to the main London market; it just strikes me that if I was on the board of directors and given the growth of the company, it is something I would be seriously considering. Guesswork of course on my part. But in my opinion it’s yet another factor which underpins the current share price and makes the stock attractive.

Per Chat GPT 🤞🏻🤞🏻, here are five key advantages of a Main Market Premium Listing over AIM:

• Access to Index Inclusion: Eligibility for FTSE indices (e.g. FTSE 100, 250, SmallCap), which attracts passive and institutional investment funds.

• Broader Investor Base: Many institutions, pension funds, and overseas investors have mandates that allow investment only in Premium Listed companies.

• Enhanced Liquidity & Valuation: Greater investor demand and visibility typically improve share liquidity and can support higher valuation multiples.

• Reputation & Credibility: Premium Listing signals stronger governance, transparency, and regulatory oversight, enhancing corporate profile with stakeholders.

• Lower Cost of Capital: The combination of wider investor access and increased confidence can reduce the cost of raising equity (and sometimes debt).

Makes a lot of sense to me to move there.

It is only a matter of time before PAF moves onto the main exchange.

The board know this, they surely must do. I’m confident it’s “when”, not “if”.

Hi Mike,

Completely agree with you on the share buyback. I’ was only responding to some of the other comments. My only point of substance being that if you’re going do it, even with these trivial amounts , it is best to buy the shares as cheaply as possible.

I agree with your assessment about printing cash, and we’re going to find out very soon whether we are correct. I hope that the messaging from the board is better than at the last half year, which was a muddle. In particular, a clear view as to what ‘26 holds, (but appropriately cautious so that we don’t have a letdown at the half year), will be very valuable.

They should have bought as many as possible as quickly as possible.

Cancel as many shares as possible to leave more equity for the rest of us.

Simple

Let’s hope you’re right about the money printing.

The huge benefit from share buy-backs is in reducing the number of shares in issue, thereby leaving more net assets and profits for the rest (fewer) of us as the company grows That’s why the cheaper the shares can be bought the better. More shares get cancelled. Companies buying their own shares is no different from the rest of us buying them, in the sense that the logic should be “buy as many as possible when they are cheap”.