Northam Platnum CEO Paul Dunne
Image: Simphiwe Mbokazi/African News Agency(ANA).
Northam Platinum share prices shot up over 7% on Friday morning after it declared a record interim cash dividend of R2,8 billion, or 700 cents per share, up multiple times from the 15 cents declared at the interim stage last year.
The dividend, which arose from strong financial results driven in no small measure by rising platinum group metals, is also much more than the 200 cents a share that was paid out at the last financial year to end June 30, 2025. The share price was seen trading at R454,19 on the JSE on Friday morning, a price that has risen 369% over a year.
This followed a 60% increase in sales revenue to R23,25 billion. Operating profit, however, increased by 439,2% to R1,08bn. Headline earnings per share were higher by more than 1000% to R2,01bn. Earnings before interest, tax, depreciation, and amortisation increased by 322,9% to R1.76bn. Total metal sold came to 519,192 oz 4E, which was 13,7% higher than a year before.
CEO Paul Dunne said despite some recent speculative froth, they believe the underlying market factors driving pricing are fundamental and should support the much-needed development of new operations. The extended timelines for mining development mean that the primary supply of PGMs will continue to fall, and thus current prices are likely to remain firm in the medium term.
Tightening supply and Northam’s growth in both PGM and chrome production were also resulting in growth in market share. "We deliberately funded our growth strategy via debt financing and internal cash flows. This has allowed us to significantly grow our production and market share without shareholder dilution. Northam will continue to allocate capital in this manner to ensure the sustainability of our operations well into the future," said Dunne.
Existing demand for platinum metals remained, and new demand drivers were emerging. The recent relaxation of decarbonisation targets in Europe and the US, combined with tightening enforcement of emissions legislation in China, bode well for automotive demand for PGMs.
"The growth in artificial intelligence is requiring ever-increasing data storage capacity, which is driving demand for platinum, palladium, and ruthenium. Ruthenium is also finding new applications in industrial chemical processes, such as the production and recycling of nylon. New developments in China, where grey hydrogen production is encouraging growing fleets of fuel cell-powered mining trucks and machinery, can be expected to yield the improvements in efficiencies necessary for broader adoption of this technology, in which PGMs are essential," he said.
"I am particularly proud of our improvements in safety performance. I am also pleased that the additional cost containment measures we have implemented are yielding results," he said.
On projects, the ramp-up at Eland mine continued with increased ore volumes and improved recoveries. Northam had purchased the mine in late 2017 from Glencore, which had placed the operation on care and maintenance in 2015.
Eland now contributes more than 20% of group chrome concentrate production. Eland mine hosts a mineral resource base of over 14 Moz 4E that boasts high platinum, rhodium, and chrome loading. At steady state, scheduled for 2029, the mine will produce 150,000 oz 4E in concentrate per year and provide employment for over 2,500 people.
Another of the group''s projects is the Booysendal South Tailings Storage Facility (TSF), which was acquired in 2015 as part of the purchase of the Everest mine from Aquarius Platinum. Work is underway to expand the facility to cater for the remaining life of mine of Booysendal South and to allow for a higher deposition rate. The capacity of the TSF is the last remaining bottleneck for an increase in the milling rate.
The environmental authorisation, water use licence, and construction licence for the expansion of the Booysendal South TSF have been received. Work has started on ground clearance, and the project is expected to take around 18 months to complete. The upgraded TSF will allow for a lower rate of rise on the existing facility.
The addition of the Western extension will allow Zondereinde mine to increase its annual production to 350,000 oz 4E and has extended its remaining life of mine to more than 30 years. During the six months, underground tunnel development within the Western extension section progressed on plan, with over 2,000 metres of additional access tunnels. Some 50,000 oz 4E more per annum will ultimately accrue to Zondereinde mine’s production profile from the Western extension expansion project.
Development and equipping of a shaft complex, comprising three vertical shafts, is in progress. Pilot drilling of 4 shaft, designed for rock hoisting, is complete, and reaming will soon commence. Subsequent equipping of the shaft is expected to be completed in 2028, ultimately assisting in optimal ore extraction from the Western extension.
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