Multinational mining and metals processing group Sibanye-Stillwater has reported an 89% year-on-year increase in adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) to R4.1-billion, or $222-million, for the quarter ended March 31.

This compares with the adjusted Ebitda of R2.1-billion, or $115-million, reported for the first quarter of 2024.

CEO Neal Froneman says the higher Ebitda reflects the benefits of the group’s diversification and restructuring efforts.

Notably, a higher gold price drove a 178% increase in the South African gold operations’ adjusted Ebitda to R1.8-billion, or $98-million, while the South African platinum group metal (PGM) operations benefited from restructuring and achieved a 74% year-on-year increase in adjusted Ebitda to R2.5-billion, or $137-million.

The group’s South African gold operations were impacted by operational challenges in the first quarter, which constrained production, particularly at the Beatrix and Driefontein mines, but these have since been addressed.

In turn, the Kloof mine is undergoing a transition to a higher-volume, lower-grade future production profile.

South African gold production for the quarter amounted to 106 001 oz, marking a 15% year-on-year decrease compared with the same quarter of last year.

The South African PGM operations recorded production of 376 123 oz, which was 3% lower year-on-year.

The US PGM operations have also benefited from restructuring and anticipated Section 45X credits, which relates to Section 45X of the Internal Revenue Code – a production tax credit – established by the Inflation Reduction Act to incentivise domestic production of minerals in the US.

Adjusted Ebitda for the US PGM operations for the first quarter (excluding provision for Section 45X credits) improved by $2-million, or R31-million, year-on-year to a loss of $9-million, or R172-million.

Including the estimated Section 45X credit of $6-million, or R111-million, for the first quarter, the adjusted Ebitda loss reduces further to about $3-million, or R55-million, in the quarter.

Sibanye-Stillwater’s US PGM operations produced 71 991 oz in the quarter under review, which was 41% lower year-on-year owing to the Stillwater West mine having been placed on care and maintenance.

Moreover, the group’s Century zinc operation, in Australia, contributed an adjusted Ebitda of R178-million, or $10-million, in the reporting quarter despite extreme weather and flooding in the prior year and the company having to implement weather-resilience measures.

Froneman foresees an increase in group cash flow in 2026 once construction of the Keliber lithium project, in Finland, has been completed.

The Keliber lithium project, as well as the GalliCam project, in France, have been designated as strategic projects by the European Commission, with the GalliCam project due to receive €144-million in grant funding from the EU Innovation Fund.

In turn, project capital for the Keliber project has been calculated at €300-million (about $326-million, or R5.9-billion) this year. The project is scheduled for hot commissioning of the refinery during the first half of next year, following which the group’s capital commitments will reduce and benefit cash flow.

Sibanye-Stillwater had previously guided capital expenditure (capex) of €215-million, or about R4.3-billion, for Keliber this year. The increase follows the March review of the project’s capex requirements, considering additional regulatory requirements and changes to the scope of the project.

The GalliCam project involves repurposing of the Sandouville nickel refinery to produce precursor cathode active material, and a prefeasibility study which will be completed during the last quarter of this year.

In turn, the Keliber project involves a concentrator in Päiväneva and an openpit mine called Syväjärvi to produce lithium.

Sibanye-Stillwater maintains its operating guidance for the year at between 255 000 oz and 270 000 oz from the US PGM operations, between 300 000 oz and 350 000 oz from the US PGM recycling operations, between 1.75-million and 1.85-million PGM ounces from the South African operations and between 514 000 oz and 546 000 oz of gold from the South African gold operations.