Integrated Annual Report 2014

Key features

FINANCIAL AND NON-FINANCIAL PERFORMANCE

FOR THE YEAR ENDED 31 DECEMBER 2014
   2014201320122011
Group operating statistics     
Gold producedkg49,43244,47438,05945,005
 '000oz1,5891,4301,2241,447
Ore milled000t18,23513,62412,18514,648
Gold priceR/kg440,615434,663434,943369,139
 US$/oz1,2671,4081,6521,590
Operating costR/t785879888673
Operating profitRm7,4697,3585,7306,752
Operating margin%34383541
Total cash cost1R/kg295,246273,281285,851220,224
 US$/oz8498851,086949
All-in sustaining cost2R/kg372,492354,376382,687296,531
 US$/oz1,0711,1481,4531,277
All-in cost2R/kg375,854354,376382,687296,531
 US$/oz1,0801,1481,4531,277
All-in cost margin3%15181220
Group sustainability statistics      
Taxation and royalties paidRm1,9975541,394486
Employee wages and benefitsRm6,6656,1565,7915,591
Total employeesNumber44,41136,27442,08438,033
Fatalities*Number1291618
LTIFR4 5.876.136.905.79
Cyanide consumptiont11,7583,7593,3953,224
tCO2e emissions (Scope 1 and 2)5t5,174,688 4,407,6714,769,2834,550,698
Electricity consumptionMWh4,274,2903,773,9193,835,1944,070,499
Water withdrawalMl116,85176,63764,78849,197
Socio-economic development spendRm1,0541,050853670
Group financial statistics6      
Income statement      
RevenueRm21,78119,33116,55416,613
Net operating profitRm4,2144,2543,3674,559
Profit for the yearRm1,5071,6982,9802,563
Profit for the year attributable to owners of SibanyeRm1,5521,6922,9802,564
Basic earnings per sharecents186260297,960,000256,410,000
Diluted earnings per sharecents182255297,960,000256,410,000
Headline earnings per sharecents170355297,790,000256,130,000
Dividend per sharecents1253773,130,000242,330,000
Weighted average number of shares'000835,936650,62111
Diluted weighted average number of shares'000854,727664,28811
Number of shares in issue at end of period'000898,840735,07911
Statement of financial position      
Property, plant and equipmentRm22,70415,15116,37615,359
Cash and cash equivalentsRm5631,492292363
Total assetsRm27,92219,99519,69818,492
Net assets/(liabilities)Rm14,9869,423(9,673)(11,976)
Stated share capitalRm21,73517,246
Borrowings7Rm3,1701,9914,220
Total liabilitiesRm12,93610,57229,37130,468
Statement of cash flows     
Cash from operating activitiesRm4,0536,3602,6213,861
Cash used in investing activitiesRm(4,309)(3,072)(3,126)(3,005)
Cash (used in)/flows from financing activitiesRm(673)(2,088)434(1,529)
Net increase/(decrease) in cash and cash equivalents Rm (930) 1,201 (71) (673)
Other financial data          
EBITDA8Rm7,4697,3585,7306,752
Net debt (cash)9Rm1,5064993,928(363)
Net debt to EBITDA10ratio0.200.070.69(0.05)
Net asset value per shareR16.6712.80(9,672,700.00)(11,975,600.00)
Average exchange rate11R/US$10.829.608.197.22
Closing exchange rate12R/US$11.5610.348.578.13
Share data      
Ordinary share price – highR29.5216.30n/a13n/a13
Ordinary share price – lowR12.346.73n/a13n/a13
Ordinary share price at year endR22.5512.30n/a13n/a13
Average daily volume of shares traded'0002,868,8424,754,958n/a13n/a13
Market capitalisation at year endRbn20.39.04n/a13n/a13
Note
  • 1 Sibanye presents the financial measures “total cash cost”, “total cash cost per kilogram” and “total cash cost per ounce” which have been determined using industry standards promulgated by the Gold Institute and are not IFRS measures. The Gold Institute was a non-profit international industry association of miners, refiners, bullion suppliers and manufacturers of gold products that ceased operation in 2002, which developed a uniform format for reporting production costs on a per ounce basis. The Gold Institute has now been incorporated into the National Mining Association. The guidance was first adopted in 1996 and revised in November 1999. An investor should not consider these items in isolation or as alternatives to cost of sales, net operating profit, profit before taxation, profit for the year, cash from operating activities or any other measure of financial performance presented in accordance with IFRS. While the Gold Institute provided definitions for the calculation of total cash costs, the calculation of total cash cost per kilogram and the calculation of total cash cost per ounce, these may vary significantly among gold mining companies, and by themselves do not necessarily provide a basis for comparison with other gold mining companies. Total cash costs is defined as cost of sales cost as recorded in the income statement, less amortisation and depreciation and off-site (ie central) general and administrative expenses (including head office costs) plus royalties and production taxes. Total cash cost per kilogram is defined as the average cost of producing a kilogram of gold, calculated by dividing the total cash costs in a period by the total gold sold over the same period. Management considers total cash cost and total cash cost per kilogram to be a measure of the on-going costs of production. For a reconciliation of operating costs to total cash cost, see Management’s discussion and analysis of the financial statements.
  • 2

    Sibanye presents the financial measures “All-in sustaining cost”, “All-in cost”, “All-in sustaining cost per kilogram”, “All-in sustaining cost per ounce”, “All-in cost per kilogram” and “All-in cost per ounce”, which were introduced during the year ended 31 December 2013 by the World Gold Council (the “Council”). Despite not being a current member of the Council, Sibanye adopted the principles prescribed by the Council. The Council is a non-profit association of the world’s leading gold mining companies established in 1987 to promote the use of gold from industry, consumers and investors and is not a regulatory organisation. The Council has worked with its member companies to develop a metric that expands on IFRS measures such as cost of goods sold and currently accepted non-IFRS measures to provide relevant information to investors, governments, local communities and other stakeholders in understanding the economics of gold mining operations related to expenditures, operating performance and the ability to generate cash flow from operations. This is especially true with reference to capital expenditure associated with developing and maintaining gold mines, which has increased significantly in recent years and is reflected in this new metric.

    All-in sustaining cost, All-in cost, All-in sustaining cost per kilogram, All-in sustaining cost per ounce, All-in cost per kilogram and All-in cost per ounce metrics are intended to provide additional information only, do not have any standardised meaning prescribed by IFRS and should not be considered in isolation or as alternatives to cost of sales, profit before taxation, profit for the year, cash from operating activities or any other measure of financial performance presented in accordance with IFRS. All-in sustaining cost, All-in cost, All-in sustaining cost per kilogram, All-in sustaining cost per ounce, All-in cost per kilogram and All-in cost per ounce as presented in this document may not be comparable to other similarly titled measures of performance of other companies. Other companies may calculate these measures differently as a result of differences in the underlying accounting principles, policies applied and accounting frameworks such as in U.S. GAAP. Differences may also arise related to definitional differences of sustaining versus development capital activities based upon each company’s internal policies.

    Total All-in cost excludes income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed to normalise earnings.

    All-in cost is made up of All-in sustaining cost, being the cost to sustain current operations, given as a sub-total in the All-in cost calculation, together with corporate and major capital expenditure growth.

    For a reconciliation of operating costs to All-in cost, see Management’s discussion and analysis of the financial statements.

  • 3 All-in cost margin is defined as revenue minus All-in cost divided by revenue.
  • 4 Rate per million man hours worked.
  • 5 The Scope 1 and 2 emissions include fugitive mine methane. The Scope 3 emissions for 2014 total 863,009 tCO2e and fugitive mine methane emissions for 2014 total 660,256 tCO2e. We have chosen to report our Scope 1 and Scope 2 emissions separately from our Scope 3 emissions as Scope 1 and Scope 2 emissions are under our direct control while Scope 3 emissions represent the effect of our business activities across the supply chain. Although it is not a mandatory Intergovernmental Panel on Climate Change reporting category, we are also reporting our fugitive mine methane emissions in the Free State province of South Africa in line with the transparency principle of the ISO GHG quantification standard.
  • 6 The selected historical consolidated financial data set out above have been derived from Sibanye’s audited consolidated financial statements for those periods and as of those dates and the related notes which have been prepared in accordance with IFRS. The other operating data presented has been calculated as described in the footnotes to the table.
  • 7 Borrowings that have recourse to Sibanye is R2,036 million which excludes the Burnstone Debt. Borrowings also exclude related-party loans.
  • 8 EBITDA is defined as net operating profit before depreciation and amortisation. EBITDA may not be comparable to similarly titled measures of other companies. Management believes that EBITDA is used by investors and analysts to evaluate companies in the mining industry. EBITDA is not a measure of performance under IFRS and should be considered in addition to, and not as a substitute for, other measures of financial performance and liquidity reported in accordance with IFRS.
  • 9 Net debt represents borrowings and bank overdraft less cash and cash equivalents. Borrowings are only those borrowings that have recourse to Sibanye and therefore exclude the Burnstone Debt. Borrowings also exclude related-party loans. Net debt excludes Burnstone cash and cash equivalents.
  • 10 Net debt to EBITDA ratio is defined as net debt as at the end of a reporting period divided by EBITDA of the last 12 months ending on the same reporting date.
  • 11 The daily average of the closing rate during the relevant period as reported by I-Net Bridge.
  • 12 Sourced from I-Net Bridge, being the closing rate at period end.
  • 13

    Sibanye, previously a wholly owned subsidiary of Gold Fields. The Company separated from Gold Fields in February 2013 to become an independent and publicly traded company.

    2013 statistics exclude Cooke Operations.

    Certain non-financial data was audited for the period 1 January 2014 to 31 December 2014, and included Cooke, Kloof, Driefontein and Beatrix Operations. Financial data reflects data from 15 May 2014 to 31 December 2014 for Cooke.

  • * The 12 fatalities reported excluded one fatality that occurred at Cooke before Sibanye took over management responsibility for this operation since 1 March 2014.