“Our financial position remains strong and our capital allocation framework remains a guiding principle for growth and diversification opportunities consistent with our strategy,” Froneman emphasized.
“As highlighted in February 2022, we have maintained capital discipline in anticipation of softer market conditions. We remain prudent with our capital investments and are leveraging our balance sheet to fund external growth during this challenging period .
“We recognize the need for appropriate debt management and focus on our leverage position during periods of decline or volatility in profitability and earnings,” Froneman added in a Mining Weekly release.
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The third quarter got off to a rocky start with three tragic deaths in the first five weeks, but there were no fatalities in the remaining three months to the end of September.
The meeting pointed out that since 2021, safety performance indicators have continued to grow, and other lagging indicators have generally remained stable year-on-year.
The platinum group metals (PGM), gold and green metals company looks forward to further improving safety over time and is focused on ensuring the year ends without any serious incidents.
Sibanye reiterated his consideration of the business environment and his intention to consider restructuring, if necessary, in areas where it is not possible to maintain a commercially viable business.
Against this backdrop, there may be a restructuring of the South African gold and South African platinum group metals businesses.
“The potential closure or resizing of high-cost and underperforming mines will ensure that operations remain profitable and sustainable at current precious metals prices and beyond, while maintaining a significant impact on the improving outlook for commodity prices,” Froneman said. .”
Despite the repositioning of the U.S. platinum group metals business in mid-2022 due to expected changes in the macroeconomic environment and a deterioration in the medium-term palladium price outlook, palladium prices fell more than expected in 2023, and the decline was weaker and faster than expected.
While mine output at the U.S. platinum group metals business improved in October, the ongoing impact of persistent inflation and labor shortages means costs remain significantly higher than planned. We are considering further repositioning to address these factors driving high costs.
As expected, third-quarter operating results improved at France’s Sandouville nickel refinery and Australia’s Century zinc processing plant, with both companies’ operations recovering from first-half disruptions. Improved operating performance resulted in Century’s business making a positive contribution to adjusted comprehensive earnings before interest, taxes, depreciation and amortization (Ebitda) in the third quarter, reversing an adjusted Ebitda loss in the second quarter.
However, despite improved operating results in the third quarter, the Sandouville refinery remained in the red due to continued inflationary cost pressures, higher maintenance costs and a further decline in average nickel prices.
Current operations are not commercially viable at current nickel prices and management has made significant progress in optimization studies aimed at ensuring a sustainable future for the Sandouville refinery.
“Positively, as part of these optimization studies, teams from the European region and Sandouville have identified innovative alternatives to the current process and are currently evaluating their commercial and technical feasibility. In the meantime, we are continuing to advance the battery research into the recycling and production of grade nickel products,” said Froneman.
Addressing the losses incurred by these businesses will ensure the continued execution of Sibanye’s strategy and position the company for future value creation.
Against this background, the construction of a lithium concentrator in Päiväneva, Finland, and the development of the Syväjärvi open-pit mine were launched. This puts the Keliber lithium project at the forefront of the European battery ecosystem as an integrated lithium hydroxide supplier of battery-grade metals until 2026, when lithium supply shortages are expected to intensify.
Platinum Group Metals Recycling Business in the United States
The global autocatalyst recycling industry remains sluggish, mainly due to an uncertain global economic outlook, recession concerns, and rising interest rates that dampen consumer demand for new vehicles. Light commercial vehicles have a longer service life and fewer scrapped vehicles.
Taking these factors into account, recycling operations processed 873 tons of material, a 46% decrease from the same period last year. At the end of the third quarter, recycling inventory was approximately 24 tons, a decrease of 18 tons compared with the same period last year.
The recent increase in global vehicle sales has led to upward revisions to 2023 sales forecasts and is a promising indicator of future recycling growth. Despite these positive developments, the recycling sector continues to face recent challenges, driving efforts to pursue and achieve volume-led growth. This also includes exploring opportunities beyond traditional autocatalyst feedstock sources.
