JSE- and NYSE-listed precious miner Sibanye-Stillwater expects to report profit attributable to the owners of the group of between R28.72-billion and R29.89-billion, or between $1.75-billion and $1.82-billion, for the financial year ended December 31, 2020.

The profit compares with and is substantially higher than profit attributable to the owners of the group of R62-million, or $4-million, reported for the 2019 financial year.

Sibanye’s earnings per share (EPS) are expected to be between R10.53 and R10.95, compared with EPS of 2c for the period ended December 31, 2019.

In dollar terms, EPS is expected to be between $0.64 and $0.67 for 2020.

Headline earnings per share (HEPS) are expected to be between R10.47  and R10.89, compared with a headline loss a share of 40c reported for the period ended December 31, 2019.

In dollar terms, HEPS are likely to be between $0.64 and $0.66, compared with a loss of $0.03 in 2019.

Sibanye says the expected increase in earnings was underpinned by a solid group operational performance for 2020, despite the Covid-19 disruptions, as well as higher metal prices and a weaker rand.

The main drivers of this operational performance were the production contribution from the Marikana operations for the full 12-month period, following the acquisition of Lonmin in June 2019.

It also reflects the realisation of significantly higher than forecast synergies, along with a notable return to profitability from the South African gold operations, following the strike in the first half of 2019.

Also boosting Sibanye’s performance were average precious metal prices being significantly higher year-on-year, with the average four-element (4E) platinum group metals (PGMs) basket price 83% higher year-on-year, at $2 227/oz of 4E PGMs.

The average two-element (2E) PGMs basket price was 36% higher year-on-year, at $1 906/oz of 2E PGMs, while the average rand gold price had increased by 43% year-on-year to $1 747/oz.

Depreciation of the rand relative to the dollar also boosted revenue, with the exchange rate, on average, 14% weaker for the period at R16.46.

However, these increases were partially offset by higher mining and income tax expenses, a loss on the early settlement of the dollar convertible bond and a fair value loss on deferred payment relating to the acquisition of the Rustenburg operation.