Gold production increased by 14.7% to 92,941 ounces, primarily due to a boost in output from the Evander mine in South Africa.
WATCH: Pan African Resources on track to achieve production guidance as projects progress 'very nicely'
Group profit after taxation increased by 125.8% to US$21.9mln, helped by the production boost from Evander, strong gold prices and favourable strength in the US dollar.
Adjusted underlying earnings (EBITDA) increased by 83.4% to US$44.2mln. Earnings per share more than doubled to US$0.014 cents per share.
“Despite the increase in the group’s overall all-in sustaining costs for the current reporting period, all-in sustaining costs at our tailings businesses operated at exceptional margins, with Elikhulu producing at an AISC of US$708 per ounce and our Barberton Tailings Retreatment Plant reporting an AISC of US$643 per ounce,” said Pan African chief executive Coobus Loots.
“We are pleased to maintain our previous guidance of gold production of 185,000 ounces, at an AISC below USD1,000 per ounce, for the full 2020 financial year," he added.
Strong cash flows
In a note to clients, analysts at City broker Peel Hunt commented: “Deleveraging in H1 2020 was not as strong as we had hoped, but the P&L beat and our conservative gold price forecasts imply strong cash flows in H2 2020.
“The Evander 8 shaft and New Consort pillar mining activities will commence within weeks; this should lower PAF cost levels significantly in the year ahead.”
Peel Hunt reiterated a ‘buy’ rating and 16p target price on Pan African shares, which in early trading were 3.8% higher at 12.70p.
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