Sibanye Gold H1 Earnings Call Highlights

Key Points

• Record first-half financial results: Revenue increased 64% year over year to nearly ZAR 90 billion, while adjusted EBITDA more than doubled to ZAR 31.8 billion. Operating cash flow surged 551% to almost ZAR 21 billion, supporting an interim dividend of ZAR 5.7 billion, or 201 cents per share.
• Debt reduction and strong South African operations: Sibanye reduced gross debt 18% to ZAR 32.1 billion, while South African PGM and gold operations generated significant cash flow amid higher commodity prices. PGM adjusted EBITDA rose 302% and gold adjusted EBITDA reached a record ZAR 9 billion.
• Growth projects approved and lithium ramp-up continues: The board approved the Burnstone gold project in South Africa and Mt Lyell copper-gold project in Tasmania, with production targeted from 2029. At the Keliber lithium project in Finland, mining and concentrator commissioning are progressing, with refinery startup dependent on operating performance and lithium-market conditions.

Sibanye Gold NYSE: SBSW reported record revenue and operating cash flow for the first half of 2026, supported by higher commodity prices and stable operating delivery across its South African gold and platinum-group metals operations.

The company said revenue rose 64% year over year to nearly ZAR 90 billion, while adjusted EBITDA increased 111% to ZAR 31.8 billion, representing a 35% margin. Cash generated by operations climbed 551% to just under ZAR 21 billion, with a 65% EBITDA-to-cash conversion rate.

CFO Charl Keyter said headline earnings per share rose to 601 South African cents, from 190 cents in the first half of 2025. The board declared an interim dividend of ZAR 5.7 billion, or 201 cents per share, at the upper end of the company’s policy range of 25% to 35% of normalized earnings.

“The dividend implies a yield of 8% if we look at an annualized number,” Keyter said, adding that the company’s trailing 12-month yield was 6.6%.

Cash Flow Supports Debt Reduction and Project Spending

Sibanye-Stillwater reduced gross debt to ZAR 32.1 billion at the end of the first half, from ZAR 39.3 billion at the end of the second half of 2025. Keyter said the reduction represented 18% in six months, leaving the company with net gearing of 0.18 times and liquidity headroom of about ZAR 48 billion.

The company remains focused on cutting gross debt by 50% over two to three years, although management said stronger cash generation could accelerate that goal. Capital expenditure totaled ZAR 8.2 billion during the half, with approximately 60% directed to ore-reserve development and sustaining capital and 40% to projects.

Management said it expects to fund recently approved organic projects while continuing to prioritize shareholder returns, balance-sheet resilience and debt reduction. The company said it may also evaluate funding structures such as streaming and offtake arrangements for projects.

South African PGM and Gold Operations Generate Most Cash

Chief Regional Officer for Southern Africa Richard Cox said the South African PGM business produced 790,000 4E ounces, down 2% year over year and in line with guidance. The decline was primarily related to surface production, while underground output excluding Mimosa rose 1%.

The South African PGM segment recorded adjusted EBITDA of ZAR 19.2 billion, up 302% from the prior-year period, as the PGM basket increased 67%. Its all-in sustaining cost margin was 44%, while its EBITDA margin was 45%. Notional free cash flow was ZAR 10.4 billion.

Cox said the K4 operation contributed 10,600 ounces, up 24%, while chrome generated ZAR 1.1 billion in operating profit. Chrome production declined to 950,000 tonnes from about 1.16 million tonnes in the prior-year period, largely due to the planned closure of the BTT concentrator after its associated tailings-storage resource was depleted.

In the South African gold business, production declined 2% to 294,000 ounces. Underground production fell 9%, while surface production increased 13% and accounted for 36% of the production mix. Gold sold rose 5% and the average gold price increased 35%.

Gold adjusted EBITDA reached a record ZAR 9 billion, up 87% year over year, with a 39% margin. Notional free cash flow was ZAR 3.9 billion, up 267%.

Cox said higher costs reflected planned maintenance and infrastructure work, including shaft maintenance, winder upgrades, water pumping costs at Driefontein and plant upgrades at Cooke. He said the spending was intended to address known operational constraints and support future life extension rather than representing a cost overrun.

Burnstone and Mt Lyell Approved

The board approved the Burnstone gold project in South Africa and the Mt Lyell copper-gold project in Tasmania, adding them to the company’s approved project pipeline alongside Thembelani, Sipumelele and Western Limb Tailings Retreatment.

Burnstone is expected to produce about 130,000 ounces of gold annually at steady state, with a 25-year life based on a targeted 2.7 million ounces of reserves. Head of Projects Ralph Lombard said the project has expected capital expenditure of about ZAR 6.2 billion, including ZAR 3.5 billion for infrastructure development. The company plans to spend ZAR 98 million in 2026 for project setup and recruitment.

The project is expected to reach steady-state output of about four tonnes of gold annually. Lombard said existing shaft, decline and surface infrastructure should reduce development requirements, with processing targeted to begin in the first quarter of 2029 following stockpile development.

Mt Lyell is expected to require approximately $340 million of project capital and has a projected 23-year life. The project is expected to produce around 26,000 tonnes of copper annually at steady state, along with approximately 16,000 ounces of gold and 116,000 ounces of silver. Sibanye-Stillwater expects to spend about $7.5 million this year on project setup, recruitment and mobilization.

Lombard said the Tasmanian operation benefits from existing infrastructure, including a decline, ventilation and water-pumping systems, although the concentrator will be new and the vertical shaft is planned for refurbishment. The mine will use renewable hydropower, according to the company.

International Operations and Lithium Ramp-Up

The U.S. PGM operations produced 138,000 ounces of palladium and platinum, down 2% year over year but within guidance. COO of International and Recycling Operations Charles Carter said the operations reported adjusted EBITDA of $66 million and a 28% margin. Notional free cash flow remained negative at $28 million, though cash outflow improved 52% from the prior-year period.

Carter said Sibanye-Stillwater is advancing mechanization at Stillwater East and East Boulder, including trials of mechanized bolting and planned changes to task mining and team-based incentive systems. He said the company is targeting a cost level near $1,000 per ounce by 2028, but described union labor negotiations and workforce adoption of the new operating model as critical steps.

The recycling business generated $164 million in adjusted EBITDA at a 13% margin and $103 million in cash generation. Carter said the business processed the equivalent of 2.8 million ounces of precious metals, benefiting from higher volumes and integration of recently acquired operations.

At the Keliber lithium project in Finland, mining began in February and the company had mined 218,000 tonnes and built a 186,000-tonne stockpile. The concentrator commissioning process is underway, with the company now focused on improving concentrate grade and quality. Capital spent to date was EUR 719 million, within the EUR 783 million budget.

Management said a decision on refinery startup later this year will depend on concentrator performance, ore quality and lithium-market conditions. If the refinery is not started, the company said it could sell spodumene concentrate instead.

The company said full-year guidance was largely unchanged, except for an increase in South African gold operating-unit-cost guidance and the inclusion of roughly ZAR 100 million each for Burnstone and Mt Lyell during the second half.

About Sibanye Gold (NYSE:SBSW)

Sibanye Gold NYSE: SBSW is a precious metals mining company headquartered in Johannesburg, South Africa. The company's core operations focus on the extraction, processing and exploration of gold. Through its South African gold mining operations, Sibanye Gold produces doré bars, gold in concentrate and carbon-in-leach product, leveraging both underground and surface mining techniques. The company also generates by-products such as uranium, copper and nickel, reflecting its commitment to maximizing resource recovery.

In addition to its South African footprint, Sibanye Gold has expanded into the platinum‐group metals (PGM) sector through its acquisition of Stillwater Mining Company in 2017.

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