EM CEEMEA CREDIT: Sibanye Stillwater: Q3 Operating Update

(SGLSJ; Ba2neg/BB-neg/BBneg)

• South Africa’s mining and metals processing group Sibanye-Stillwater posted a strong Q3 operating update on a supportive environment for underlying metals, both gold and PGM. In secondary market, we look at recent spread performance vs pure-player, larger gold miners Gold Fields, AngloGold Ashanti, Endeavour as well as Navoi. Our feeds show SGLSJ 29s charting at z+292bp area near the local lows, some 155bp tighter YtD (source: Bloomberg).
• In our read, Southern Africa gold production remains a key driver, boosted to almost 179koz in Q3, a sound rebound from a lower Q2 level as the group recovered from earlier operational constraints, despite being marginally lower y/y. We gain comfort from the latest FY25 guidance confirmed at 480-514koz. FY cost and related capex guidance have also been confirmed at $$2,473-2,643/oz and ZAR3.5bn respectively. Segment adjusted EBITDA is reported at USD212mn, +177% y/y, on higher sale prices.
• PGM saw increased basket prices supportive of adjusted EBITDA reported for Southern Africa’s operations at USD281mn, +213% y/y, with positive contribution from US operations at USD33mn, over +100% y/y. In terms of production, strong growth in South Africa at 493koz, with mixed y/y moves in US operations, showing underground prod’n lower y/y at 73koz and recycling higher y/y at 82koz.
• Elsewhere, there was nil production in Q3 for European Nickel (on going plant ramp down in France) whilst Keliber Lithium project progresses with Q3 capex at €75mn in line with FY guidance at €300mn. Marginally lower y/y Zinc production in Australia on calendar changes to planned maintenance shutdowns affecting y/y analysis, segment adjusted EBITDA sat at USD28mn, lower y/y.