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Sibanye Gold Shs Sponsored American Deposit Receipt Repr 4 Shs (NYSE:SBGL)
Q4 2019 Earnings Call
Feb 19, 2020, 3:00 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Neal Froneman -- Chief Executive Officer

Good morning, ladies and gentlemen and awesome occasion to meet, especially just after listing as Sibanye-Stillwater. We have a very long and detailed presentation. I'm not going to go through the detail on every slide, but I would suggest that in your own time, you look at the information. It's good quality. But I'm also happy that we come back to any particular slide at question time if that is what you'd like to do.

The structure of the presentation this morning is, there's a highlight section. I'm then getting to look at roughly where we've come from, a bit of ESG in that. And then we'll get on to some of the results. Charl will then present the financials and I will conclude post that.

As with any good mining presentation, there are forward-looking statements. So please note the safe harbor statement. Highlights for 2019 and I think we should work through these quite carefully and in detail. First and foremost, safety performance increased dramatically from 2018. And that wasn't just by more effort. Of course, a lot of effort went into it, but a lot of fairly radical thinking and a new strategic framework helped us achieve the results. But since August 2018, our ultra-deep level gold mines have been fatality free. That's never ever been achieved in the South African gold mining industry. So that's 10 million fatality-free shifts. In terms of transformation, it continues. And we have restructured our gold operations. I'll talk a little bit more about that. There's been a very significant reduction in the footprint and the assets that we now run. We did complete the Lonmin transaction, and I want to say with very fair Competition Commission conditions.

I think I want to actually say to them well done. I think it was a nice balance between what is necessary for business to do with assets like these and in the national interest of extracting resources in a balanced way, so that all stakeholders will benefit. So that was good.

The increase in our investment in DRDGOLD was also completed. And we'll talk a little bit more about that. Niel Pretorius is here. Neil, are you here? There you are. Thank you. So Niel is really part of the team [Technical Issues]. And of course if you've got any specific questions on DRD, I'm sure he'd be happy to answer those. The gold strike. I do think we should stand back and a lot of analysts did make comments [Technical Issues] very significant and I want to say well-thought-through positioning that we took as a company. We knew there were platinum wage negotiations coming, we had to complete Lonmin. We had to actually look a step ahead of that. We had to integrate Lonmin and you can't do that when you're in a weak position. We had to reset that relationship with that particular union, and we had to reset it to one that is credible, where we sit around the table, we stopped the morning ridiculous things and we [Technical Issues] way that's in the interest of [Technical Issues]. So that was done, and it cost us a lot of money. And certainly I think the rest of the PGM industry benefited from that, but never mind that. It resulted in successful wage negotiations. We have done the analysis. If you look at the settlement that Sibanye-Stillwater achieved, it was much better than our peers. And in fact, we've even done an analysis to see what sort of return we achieved based on the cost of that strike. And I don't want to give you an exact number, but I can assure you that was a smart business decision. So that was absolutely necessary, and we now have a credible, respectful relationship from both sides.

In terms of strong earnings, you've seen the numbers. Our adjusted EBITDA for 2019 came out at ZAR15 billion. That was based on most of it being in the second half. In fact, about ZAR2 billion was in the first half. The balance came in the second half, and I must say that is not the end. If you -- and maybe I must just stop there and mention that as an executive, we had, what we call, a big audacious goal of ZAR16 billion at a time when our numbers showed we are only going to get to ZAR8 billion, ZAR9 billion, ZAR10 billion short [Phonetic]. And we got here, we got here. So that's very pleasing for us. Also I want to say, if you consider that operationally things should be pretty straightforward in 2020, you could double that number for 2020. But please factor into your prices that in the South African PGM sector, the basket price compared to the second half of 2019 has gone up 40%. Again, in the US, it's gone up another 25%. So ZAR30 billion is for a year of adjusted EBITDA is actually not difficult to see and you can then start looking at net debt-to-EBITDA ratios and you'll see, we've actually deleveraged. That's done.

Which brings me onto the next significant issue, which is the balance sheet. It's been significantly derisked. Our target, as you all know was 1.8 times. That was the guidance target. The results will show we actually came in at 1.25 times. And as I say, if you factor in commodity prices today, and remember, there is no wage negotiations in 2020 other than at Kroondal, but that is normally relatively straightforward. But there is no sector wage negotiations. So we should really see further balance sheet deleveraging, and we are now past looking at net debt-to-EBITDA. That will always be a consideration, but now we need to get our gross debt down, and we are targeting gross debt of about $1 billion. I'm sure Charl will talk more about that.

In terms of shareholder value creation, we believe we've created a lot of value. And yes, we've had the commodity prices in our sales, but remember we took decisions based on our view that there will be fundamental deficits in palladium and rhodium and it's not our job to predict prices, but if we get the fundamentals right, you have a high degree of confidence that there will be a price squeeze, and you have that behind you. So it wasn't laggard [Phonetic], and we've been through this in a number of these presentations. We will discuss a bit on the market, but it's almost now a common wisdom that palladium and rhodium are in deficits for the foreseeable future.

So let's talk about what's very important, and you saw some of that with our listing and that is ESG issues. We have developed and you will see toward the end of the presentation that ESG is central to our strategy and we have a strategic framework, much like we developed in safety, and it is set out here. I don't intend to go through each box. The one that I do want to talk about though is environmental. I believe we have the basis to set ourselves apart to our peers in the PGM sector because of our very good environmental positioning. It doesn't mean that others are less important but you're going to see us drive our environmental positioning quite aggressively, and it really goes around the very good base we have in the United States. We have the lowest emission smelters in the world in the PGM sector. Emissions, in general, are lower. As you will see from this presentation, we have very significant recycling. We have world-class agreements with our good neighbors and there is zero litigation around environmental issues. If we can replicate that in South Africa, and we have serious intentions to do so, and that coupled with the fact that PGM is part of addressing global climate issues. That is going to set us apart. It is unique to PGMs and that is going to receive a lot of attention. You can see the associations that we are now members of, and compliance with those organizations is a critical focus area, and you will see more of that.

Just very briefly, I think this is well known and again I'm not going to go through it in detail, but we all know that PGMs are predominantly used in auto cat. We also know the role of platinum in the renewable energy side. And we also know that the hydrogen economy is certainly going to be the economy of the future, whether that's in five years or 10 years or 15 years, it is coming. We are going to be sponsoring a Hydrogen Conference in Japan during the Olympics. And in Japan, they're probably the most advanced, and that's together with SFA. So watch this space. If it's something of interest to you, then certainly you would be more than welcome to join us. That will be in Tokyo.

In terms of safety and that's part of the S in ESG. As I've said earlier, we've had an industry-leading safety performance in gold. Our US PGM operations have been fatal free since 2011, but notice a difference in exposure. They've achieved 2.6 million fatality-free shifts. So obviously a much smaller workforce, more mechanized, which also means that from a mechanization point of view, the risk exposure is much lower. Compare that to the 10 million in gold, and you start realizing the significance of 10 million fatality-free shifts. We've won a number of prizes. And I'm not going to go through that, but there is still a long way to go. The industry as a whole improved. You saw the stats come out of the DMAF [Phonetic]. We had six fatalities in our PGM business. We are not as far advanced in rolling out the framework that I'm going to show you on the next slide. In our PGM business, some of the initiatives take time, require certain conditions and so on, but we will address this and we will get it down to the same levels as we've got in gold. That is the framework and I've presented this in detail a number of times at our results. So I'm not going to go through it in detail, but this is exactly the strategic framework that is being rolled out in our PGM sector -- business. It is the framework that, I would say, has largely been responsible for what's been achieved in gold and it revolves around values, getting value-based decision-making taking place throughout the organization and that's principally done through creating an enabling environment, empowered people, engaged leadership and then fit-for-purpose system. So we have a model. We have a plan and I dare say you will see the results in the not too distant future in the PGM business as well.

So let's just talk about the new base that we've established. And again some of these are not new slides, but important to reflect. So we have clearly [Technical Issues] into a top-tier precious metals company and it's unique. There is no other company in the world that has the combination of gold and PGMs, and I've had a very highly respected letter right out of the US, actually made contact with us, highlight the issue, congratulate us for the positioning and ask us why we are not in silver as well. And that's a very good point. And we took note to that. But nevertheless, look at what we [Technical Issues] just remained a gold company, we would have today been a small gold company. And [Technical Issues] on the right hand side, you can see the combination of PGMs, our recycling business and gold. It's completely, completely different. So we now have a sustainable company. And remember the investment thesis for buying Sibanye shares is that you're going to be part of a company that's going to pay an industry-leading dividend. And I've received the notes from some of our shareholders. And I hope that on the line we take note of that, and I'm going to mention it a few times in this presentation, just in case you missed this comment. We are seriously committed two reestablishing our dividend and we've given guidance that -- and I have to use the legal terminology, that will probably happen in -- with our mid-year results; probably is a very light word, it will happen with our mid-year results. So that's the basis on which we can look forward to sustainable dividends in the future.

We have built a very large reserve and resource base; 63 million ounces of gold and PGM reserves. I'm not going to go through this in detail, but it is interesting. You can do it in your own time if you want to. 40% of that reserve is in South Africa; 38% is in the US. So the US is a significant part of our value base in PGMs. Resources, you would remember in the US, the definition of a resource is a little bit more onerous and we've got big resources in the US. It's just not reflected in these numbers yet, but you can see we've got 309 million ounces of gold and PGM resources as well.

At a PGM conference at the Indaba, I made the point specifically to the end users of these products. They are lots of resources of PGMs. The market needs to come into balance and we can mine our resources and deliver palladium and rhodium, but we can't do it when platinum remains depressed. And I'll get onto that shortly.

How did we get here? I think it's well known, but we just want to make the point that we spent ZAR45 billion acquiring four assets. One, which is a Tier 1 asset and there's not many Tier 1 mining assets in the world, and that being Stillwater, but that if you look at what other PGM companies have invested in their business over many years, that is a very low cost entry point, and one that we are particularly proud of. Here, you can see the entry point and it is at a low in the cycle. And again, we've been through this graph in detail in previous presentation. So I'm not going to go through it in that sort of detail, but it's there for reference purposes. I just want to say in terms of the commodity mix, we are very well positioned, and we're the only PGM producer with about a 50-50 split between palladium and platinum. It's not quite 50-50, it's 51-42 as you can see. But that is much more balanced than any other producer.

I think the other important thing to note is recycling. If you look at the US operations on the right hand side of that slide, you can see that recycling is a big, big part of our production business. We certainly produce more palladium and platinum from recycling than we do from underground mining. So important to note those aspects. It does differentiate us with respect to our peers.

So just looking at future trends before we get onto the results. And again, as I say, it's almost become common knowledge that palladium and rhodium are in deficits, but it's much more complicated than it first seems. Loadings are key issue, and you can see from the bar graph on the left hand side -- apologies. From the bar graph on the left hand side, you can see how loadings have increased in different jurisdictions, and that's palladium loadings, and that's due to stricter and tighter environmental regulations. If you look at palladium and rhodium in China, you can see how the loadings have offset the reduction in car sales or the decrease in compound annual growth rate in the global car pool. So that is what is driving increased palladium and rhodium prices. We get a lot of questions about this less car sales. So what is driving the increase in commodity prices. So that's effect, that was for 2019, and there's [Technical Issues] why it won't be different looking forward for the next few years.

Again, I'm not going to go through this in detail, because we have presented, certainly the slide on the right hand side many times previously. I think -- and again it's interesting to engage with some of the end users. And I think you just flick a switch and you start producing more palladium, rhodium, and even platinum. It doesn't happen like that even if you factor in all of the projects that are currently being considered, with the growth in Russia. And some of that growth is actually -- and I'm not talking about the growth in Russia, I'm just talking about the projects in general. Some of it is very questionable, but nevertheless it's factored into the primary palladium supply and you can see there is not big ramp-ups possible from primary supply. You can also see that a significant amount -- and I'm referring to the bottom slide, a significant amount of supply is also coming from recycling. And if you look at the percentage of spend catalysts, it's actually at a significant level when you think about the process of collecting order cats and decanning them and getting them back into the system. So there's not a lot more supply that we can see coming from secondary sources or recycling. The bottom line is, you have the deficits in the graph on the right hand side with no short-term change in demand and no short-term opportunities to increase supply. So this is a feature of the market today, and looking out for the next four, five years. If you look at rhodium, the situation is actually even more dire and hence why you're seeing the rhodium price doing what it's doing. Because rhodium predominantly comes from UG2 mining in South Africa, the lack of investments since 2008, you can see the decreasing trend in supply. We understand the demand side of rhodium, and hence you get the very large deficits that are occurring in a relatively small market. But again, there is nothing on the horizon to change the direction of these graphs. In the past, rhodium was substituted with palladium, but it happens in a ratio of roughly four to one. So you've never had palladium and rhodium peaking at the same time. You have that today. So substitution of rhodium by palladium is not going to happen easily under these circumstances. So that's the nature of the palladium and rhodium market. If you move on to platinum, probably I'm going to be a little bit controversial here. Platinum is turning, has turned. We have been watching it very carefully. It went to $1000 again today, but we've actually seen the market tightening, and as I say, you need to actually sit back now and say, all right. So if you can't deal with shortages in palladium and rhodium, OK. It's not a shortage of resources, we can open up those resources as mining companies, but we can't flick a switch and do it tomorrow. We also cannot do it if it's going to destroy the market, which is our primary product being platinum, then what has to happen? Well, it's incumbent on the end users to help us get platinum to a position where we're not going to destroy the platinum price. You cannot continue to operate in deficits in palladium and rhodium forever. It will not -- if it's in a deficit, there is ultimately going to be a shortage at some point in time. So the way to deal with this and it's something we recognized a few years back is you have to substitute palladium with platinum in gasoline engines. Diesel demand is weakening. Gasoline engines and hybrids are certainly internal combustion engines of the future and if we're going to be responsible about mining these products in a balance -- in a basket balance, you have to move into substitution. So we've been sponsoring research together with BASF over the last couple of years. And the initial testing or the lab work was done. There has been on-road testing. There's even manufacturers that have tested, and I would suggest that substitution is much closer than what we think. Time will tell. Time will tell, but until you bring -- until you get this basket into a balance, you're going to be short on palladium and rhodium. Once you substitute palladium with platinum, you will create the opportunity to address the rhodium shortage by using palladium and you bring the whole marketing to balance. So I hope you found that useful.

There is one other graph on this slide that I think is important. I hear often how we are underspending and that's why we -- on capital, I should say, stay in business capital. And that's why we are able to bring our cost down. Well, that's absolute rubbish. If you look at the top right hand graph, and this wasn't prepared to defend our position as Sibanye-Stillwater, it was to show there has been a lack of expenditure in general in the sector into primary platinum supply. If you look at that graph on the top right hand side, you can see, on average, we spend the same amount that was spent by previous operators on our business and very much in line with the rest of the industry. So that is not the reason we bring our cost down. I will get to the reasons we are able to move our operations down the cost curve shortly.

Okay. So let's just talk then about the results, and we've put out a much more detailed release, but I think these are just sort of high level views of what's been achieved. You can see from an adjusted EBITDA point of view, the second half of 2019 is a record for us. And you can see what created that. It was positive adjusted EBITDA in gold but very significant contributions from the South African PGM sector and increasing US EBITDA performance. And as you look back, you can see that certainly exceeds anything that was done even at higher gold prices. So we are very pleased with that.

I've been making the point about a balanced portfolio and a portfolio which I've shared with you the market in terms of PGMs and how it underpins us. But if you look at our reserves as a group now, including gold, you can see the split between the South African gold, South African PGMs and the US 2E reserves. If you look at production ounces, you can see that most of the ounces came from the South African platinum business, smaller portion from the US and still a significant amount of ounces coming out gold. But if you look at the profitability or the adjusted EBITDA, you can see that gold actually only accounts now for about 15% of our EBITDA with the balance coming from South Africa and the US PGM business. We've also given you information on the contribution of the various metals to our profitability and the revenue contribution compared to the ounces. So you can see it from a Group perspective. You can see it from a South African perspective and a US perspective. I think the takeaways are really the contribution that rhodium is making 9% of the ounces in South Africa come from rhodium, but 29% of our earnings are coming from rhodium. In the US, it's clearly a palladium story. A large portion is already palladium and of course palladium is at a all-time high. So that's interesting information.

If we look at the specific operating segments, the US contributed 33% of our Group adjusted EBITDA. You can see the combination of mine production and recycling. What's important to me from this graph is the operating margin, the adjusted EBITDA margin of nearly 60% now. That is very nice profitability from an operating point of view. So looking at the notes on the site, high grade, high quality operations. The difficulties we had in the second half of 2019 are largely behind us. There is a small knock-on effect into the first quarter, but unfortunately, it has delayed the Blitz ramp up. We will see if we can pull that back, but I think what we've lost in the last eight months is reflected in the final numbers of the project. We will see what we can do to pull that back. The Fill the Mill project is on schedule, on target and should be able to produce its 40,000 ounces by late 2020, and then of course as you would expect at these commodity prices, we are receiving record recycling inputs.

In terms of the South African PGM operations and well done to Robin and his team, an excellent performance; steady, delivered on guidance. Obviously lots of gearing to the PGM basket price, that's going to flow into 2020 as well, as I said. Compared to the second half of last year, there has been a 40% increase in commodity prices. So we're not going to give you what we estimate the next period to look like. And we've done that before, but I think you now have enough information to do it yourself. And of course, the Marikana operations have been incorporated. So that's the step up in ounces. The small reduction in operating margin is due to the higher-cost Marikana operations that we've brought into the fold. But as you will see from some of the upcoming slides, we're going to obviously address that reversal. So yeah, very good performance from the South African PGM business. Gold, as you know last year was a tough year for gold. We had the strike, which actually wasn't even about gold wages. As I said right at the beginning, it was about trying to stop the Lonmin transaction. It was all about Lonmin. But nevertheless Shadwick and his team took the strike, managed that extremely well. Had to restart an ultra-deep level gold mine, a gold mining in an area where seismicity is a huge issue. Cooling is difficult. Those were all difficult challenges from a seismically active operation that requires steady state performance. That was done without any fatality. So again, under very difficult circumstances, the fatal-free numbers were achieved.

Production rates have been normalized. We've given you an indication here of the difference between 2018 and 2019. I'm not going to go through those in detail. Obviously, we're fortunate to now include production from DRD. I think what's important though is, we now have 13 operating shafts and six processing facilities compared to 19 shafts previously and nine processing facilities. There has been a huge reduction in the operating footprint, which actually positions the gold business to do well in the future.

I know there will be questions on the recent acquisitions. And I think it's incumbent upon us to actually give you some guidance, and Rob is here. Rob and Kevin can give you more detail if you have more detailed questions, but integrating a new business, especially a business that wasn't doing well that had been through very difficult times is not easy. Rob and his team developed a 180-day plan, and it has many facets. In the middle of this plan, there was platinum wage negotiations that they had to deal with. There was of course a major restructuring, which was done without any industrial action and of course the reason we do this is to create sustainability. And you can see from the end of the era, we should really be in a, let's say, a sustainable position from about August of this year. So when you look at the guidance for Marikana, you will see that it's a little bit below where we feel that steady state will be, and it's because in the first half of this year, there is a lot of reorganization, there's a lot of the skills mix issues once you've been through 189 process and so.

I'm also very pleased to be able to give you an update on the synergies. And again, there's a lot of good quality information in the slide. I'm really going to just home in on some of the key numbers. So when we did the due diligence, which was now a few years back, we identified what we call ZAR730 million of annualized potential savings or synergies. What you see in the very right hand column is what we now estimate based on having been on site, having refined these plans, we are looking at getting to about ZAR1.2 billion by the end of 2020. So I want to make it clear, that's not for the whole of 2020. That's the run rate we are going to be at. Rob and Kevin you're happy with that? Okay. Just want to make sure. That is a significant step-up from the ZAR730 million that we said would take three years to get. So I will show you an industry cost curve and we're not going to predict where Marikana ends up, but it will -- certainly you'll see from this type of information is going to make very significant steps forward. What we never included in any of our assessments is what we refer to as savings on refinancing. Lonmin entered into a stream, which we call the PIM prepay and we've refinanced that, and you can see the annualized savings on that we estimated another ZAR210 million. So very nice progress at Marikana.

Just in terms of how we see the world, nice to see that some of our operations are sitting on the left hand side of the industry cost curve. We are going to move Marikana and Rustenburg certainly into the lower half. I think last time we presented this Marikana, we're sitting right on the right hand side. So we've already made some nice progress, but a very I think balanced portfolio, not only from a combination of palladium and platinum, but you can see the potential to have low-cost operations when you look at it on this basis.

Our strategic stake in DRDGOLD, we are very excited about. Of course, DRDGOLD is a business that is well run. Otherwise, we wouldn't have invested in it. We don't intend to run it. Niel and his team are good at what they do. And certainly I think what we can do is share some of our experience in terms of growing into other commodities. We have tailings opportunities in the PGM sector. We certainly have the ability to help them internationalize if that's what they want to do; could certainly start at Stillwater, but there is another element to this business that I think is underrated, and with ESG issues becoming so prominent and almost that first falter. This is a company that cleans up the environment deals with legacy issues and a very, very important part of the E and ESG from our point of view. So we will work together with DRD on those aspects.

Just from a commercial point of view, we did exercise our option to increase our stake to 50.1%. Niel we have to brag a little bit about what it's now worth, ZAR4.1 billion. We've ended in assets which had value, but the market gave us no value for it. Those were some of our selected tailings asset, which DRD has made a huge success with. And of course that removes some of the liabilities from our balance sheet as well. We paid cash of ZAR1 billion and that also gives you an indication that the company is not in the same highly leveraged position that it was literally a few months back. We were able to do that out of our own resources. And because of the very rapid increase in DRD share price, that was done on a basis of ZAR6.46 per share, which at current market value represented a value uplift of about ZAR500 million. So again commercially very smart from our point of view.

In addition, we've received dividends of ZAR52 million in August and ZAR108 million in February this year. So it's been a great investment from our point of view.

I just want to talk a little bit about SFA. SFA we presented as a company we bought to help us develop our battery metal strategy. SFA has turned out to be much more than that. It is a great little business. It has great people. They have been very helpful and influential in improving our understanding of the PGM business and helping us align our ESG strategies on the environmental side. As I alluded to right at the beginning, SFA and Sibanye-Stillwater will be hosting a conference to drive the hydrogen economy initiatives and understandings in Tokyo later this year. And I suggest that you look out for that.

At this stage, I'm going to hand over to Charl, who will take you through the financial performance. Thanks Charl.

Charl Keyter -- Chief Financial Officer

Thanks Neal and good morning ladies and gentlemen, and forgive me if I sound a bit like most ceremonies upfront, but I think two groupings that I really want to thank this morning. Obviously, last time this year, I was a lot pile, my knees were sore. I was praying for recovery in prices and pleading with our lenders to allow us some covenant relief, but happy to say today that after intensive drilling by the risk committees, they supported us and they stood by, and a big thanks, and there are some of them in the room this morning. So thank you to the lenders.

I think secondly to my accounting team, and obviously our new auditors. The results we are seeing this morning is simplified, but it's up to 80 subsidiaries that needs to be consolidated, and Lonmin alone accounts for 40 of those. So you can see it's a big task. And how they managed to burn the candle on both ends, and then ultimately deliver the product today, I think a big thank you to both of them. This is my excited face. So really excited this morning about the results. So if we then move into the financial results.

Let's start with revenue. Revenue for the period increased by 44%. That was on the back of a 69% increase at our US PGM operations or ZAR11 billion. That was driven by 37% higher average 2E basket price and 9% weaker exchange rate and a significant increase in recycling volumes.

SA PGMs increased by 82% or just under ZAR12.5b. And I think what's even more significant, and you will remember that in the first quarter of this year, we barely recognized any revenue for our SA PGM assets following the change from a purchase of concentrate to a toll arrangement. So that number could have been significantly higher. The Marikana operations contributed ZAR11 billion in the seven months that they were part of the business, and then these operations also saw 44% higher average 4E basket prices.

SA gold operations and that includes DRD, however, decreased by 5%. The impact of the industrial action was a 33% impact on our ounces produced from our South African gold operations. And as Neal said, I just want to quote a few numbers this morning. So if you at -- and the first number I will quote is the 2019 number and then I'll give you the spot prices today. If you look at the US dollar basket price, the average for 2019 was just under $1,400 an ounce. Today, it's at about $2,300 an ounce. The SA basket price for our PGMs on a 4E basis average for 2019 ZAR21,700. Today it's at about ZAR36,000 per 4E ounce. And then gold as well also benefiting average for 2019 $1,400 an ounce and today it's at $1,600 an ounce. Now you can factor in those numbers even on these results, and Neal obviously spoke about the impact that that will have on the business. But those are significant increases that will flow through to the bottom line.

If we then move to cost of sales before amortization and depreciation, that increased on the back of a massive increase at our US PGMs because of recycling. Recycling alone increased by just under ZAR7 billion. And remember that the input cost of recycling is largely driven by the market prices of the products that are being recycled. So if those prices goes up, obviously the input cost also goes up for us in the business, specifically on recycling. At both our SA PGM, and I'm going to exclude Marikana for this comparison, the costs reduced. And that was also a factor of not recognizing revenue for the first quarter of the year and then we could drop out the associated costs. And similarly, at the gold operations due to the industrial action, costs were lower period on period.

The adjusted EBITDA of just under ZAR15 billion, is a 75% increase on absolute values, remembering that Marikana has only been part of the business for seven months. If we annualize that, Marikana's contribution was ZAR2.5 billion for the seven months; annualized ZAR4.2 billion. And that if we then on a pro forma basis express the EBITDA, that would have been just under ZAR17 billion or 100% increase. Amortization and depreciation, the main increase there was the inclusion of Marikana. Net finance expenses that was flat period on period and then we had to book a significant loss on financial instruments. And the next slide will illustrate that graphically. But the main driver there was the convertible bond. So, the better the share price, then we have to book a loss on the convertible bond because obviously it's worth more in the hands of the convertible bondholders.

And then there was also two other line items. So obviously, the higher prices -- commodity prices that also drives the benefits to BEE shareholders and obviously Anglo will receive from our Rustenburg operations. That accounted for ZAR1.2 billion and just under ZAR900 million respectively. The gain on acquisition, that was the Lonmin acquisition. You can see that we realized a gain there of ZAR1 billion. I think at today's prices, who knows what that number could have been. But at the point when we valued it, that was the gain that we realized.

Restructuring cost. Again, a significant number. The restructuring cost at the Marikana operations was just under ZAR700 million, and then at our SA gold operations just under ZAR400 million. Royalties; significant royalty payments, and it's worth highlighting that the SA PGM segment paid just under ZAR350 million of royalties. And then the SA gold operations ZAR74 million. Mining and income tax. The current tax for the period was ZAR1.8 billion, but that was offset by significant deferred tax credits, mostly relating to the changes that we saw in the US. Remember last year we had to book a deferred tax debit. Through some renegotiation of contracts, we managed to bring that down and that was the changes in the US. And then also, there is also some deferred tax impacts on the Anglo deferred payment and then also on the BEE shareholding.

The profit for the period has been ZAR433 million compared to a loss of ZAR2.5 billion for 2018. And if we just take out the effect of the revaluation of the convertible bond, then last year, we would have had a loss of ZAR3.2 billion because last year we booked a gain on the convertible. This year, if we take out the effect of the convertible bond derivative, it would have been a profit of ZAR4.3 billion so if we just normalize for that element. If we now go to the next slide, and this illustrates the impact of the convertible bond. And you can see that the shaded area on the back of the graph is the share price and how that has driven the valuation of the convertible bond. The black line that is the conversion line, and that's roughly at about ZAR22 a share. Remember that the reference price was about ZAR16; conversion price about ZAR22. And then there is also soft call option that kicks in from about October this year. And effectively, if the share price trades above ZAR28 for -- it's about 20 trading days, then at our option, we can convert the convertible bond. And you can see even at today's price, which was around about ZAR47 when we opened, we are well within that territory. So the effect of the bond was that on face value ZAR384 million; that's outstanding. But based on December 31 share price, ZAR623 million is what that convertible bond is worth, and the reason why we then had to book that significant loss. It's unrealized loss through the income statement.

Normalized earnings, you'll know that our dividend policy is to pay at least 25% to 35% of normalized earnings. So if we then go on to normalized earnings, you'll see that for the six months ended December 2019, our normalized earnings were ZAR4.5 billion. However, in the first six months of the year, that was a loss, but on a total year basis, normalized earnings of just under ZAR2.4 billion, and that compares to a loss for 2018 of ZAR1.4 billion. To our strategic priority of deleveraging, we've signaled and we've communicated to our shareholders that we would not be paying a dividend in 2019. But you've heard Neal say that with the strong probability, it will start in half one 2020 and we look forward to resume dividend payments. I think what we have done recently, you will see that we've started talking about reducing gross debt. We want to take that down from about $1.8 billion -- $1.7 billion to $1.8 billion right down to $1 billion or about ZAR15 billion. The significance of that is that our earnings can go as low as ZAR6 billion, and we would still be comfortably within our covenant ratios. So that introduces a decent safety margin into the business as well, but it's also prudent to pay down debt.

I think on deleveraging, a lot has been said, but I think this graph just highlights the significant deleveraging that we've seen since March 2019. We had peaked at about 3 times net debt-to-EBITDA. And at the end of 2019, that was down to 1.25 times, remembering that we wanted to be below 1.8 times by year-end. So again, a significant -- well, we are well ahead of that target. The covenant limit was 3.5x for 2019. But that steps down. Remember, we had a period of elevated covenant limits. That steps down to 2.5x, but again we are right in the middle of that. As I've said, we'd like to take the gross debt target from $1.8 billion down to $1.0 billion, but remember we've always said to the market that our comfort level sits at about $1.0 billion. And I would hazard a guess that at today's prices, we are already at those numbers and possibly even below.

If we then go onto our available liquidity. This is just a slide that illustrates our borrowings and our facilities and you'll see that on our dollar RCF, it's a $600 million facility. There is about $400 million drawn and that is mostly to assist us with some working capital needs. More specifically at our US PGM operations, as I've explained, we have been pushing the recycling hard and that has put a strain on our working capital, so the main reason for that.

Rand RCF, which was close to fully drawn this time last year; is now drawn to a level of ZAR2.5 billion and it's a ZAR5.5 billion facility. So if you look at our available liquidity, and we've also got some general overnight facilities, available liquidity sits in the order of about ZAR7 billion to ZAR8 billion as it is today and that picture is improving every day.

And I think this is just our debt maturity slide and you can see well under control. Although there are maturities in '21 and '22 specifically on our revolving credit facilities, remember that these facilities do make provision for extensions. On the dollar facility, we can still apply for further one-year extension. And then on our rand facility, we have the option for further two-year extension. So debt maturities well within control. And I'm not losing sleep at this point in time. That's then my last slide. So I'll hand back to Neal to take us through the conclusion. Thank you.

Neal Froneman -- Chief Executive Officer

Thanks Charl. All right. As I indicated earlier on, we would get to talking more about strategy. And again, nothing really new. Our strategic focus areas are shown. They all go through them now. But what we are focused on as a company is to strengthen our position as a leading precious -- or international precious metals mining company by doing the following things, and probably in order of priority, let's start at the top, building a values-based culture. A lot of that you saw in the safety slide. Those of you that follow business thinking, strategy is clearly important, but culture eats strategy for breakfast. So it's critical to develop the right cultures in a company. So we will be enhancing what I think we already have, is a good culture, but to something that is outstanding.

Our core business is operational excellence. So, focus on safe production is a critical focus area and that is really important in terms of delivering the earnings that you've just seen. Deleveraging our balance sheet is a fundamental priority. But I would almost say that it's done other than bringing down the gross debt, which will just take some time. Addressing our South African discount. And I was asked this question last time. There is two components to this. The one is actually trying to influence a better outcome for business in South Africa, trying to deal with these negative issues that international investors have of our business in South Africa. That's the one aspect, and of course the second aspect is at the right time considering appropriate listings for the company. But our primary focus right now is to grow our business and try and influence the outcomes in South Africa. And it's only once those things are really in order will we look toward value-accretive growth. Now, I want to again say it and Charl said it, and I've said it previously, our next most important priority is to reinstate our dividends. And you've got good guidance on that. Central to this, and this is what's new in our strategy is the whole incorporation of ESG. That is certainly important, but it's not onerous. That is the right thing to do, and I spent the first part of this presentation just showing you exactly how we think and what that framework is starting to look like.

Again, just in case somebody has come on to this call late, strong shareholder value creation returns, the intention to resume dividends. Total shareholder returns are made up of dividends and capital appreciation in the shares. There is a relative performance graph of our share price performance. And as I've said to many analysts, many media interviews is, the rerating that's taken place of platinum companies or PGM companies has really been those least -- I suppose, those that are least risky, such as Anglo Platinum with high-quality assets, Impala that didn't really have large amounts of debt. And then of course, we are highly leveraged with our entry into the PGM sector. And this is our year to outperform. So I believe the market does work like that.

In terms of valuations, we are undervalued. The very first interview I had this morning was we had an all-time high, so where is the upside. Well, there is a lot of upside. James was just telling me our share price is at just over ZAR50. So that's already another ZAR5 today. But the fundamentals are still supportive of a company that's got substantial upside. If you look at EV-to-EBITDA and the two bars are 2020 and 2021 estimates of earnings, you can see that our multiples are uncommanding. Certainly, we should be in the senior PGM space. So you can almost see a doubling in multiples that we should get exposure to.

If you look at price on free cash flow per share, it's the same thing. There is probably significantly more upside when you look at that metric. Net debt to 2020 estimates, again you can see where we are, well below 1x. And I would argue that will probably be even lower. And the same with the enterprise and market cap. We do not have a commanding EV and market cap. So again everything underpins a substantial possibility of a rerating. When we run our life of mine models, our current market cap is just in excess of ZAR100 billion. We are getting NAVs well in excess of ZAR300 billion at current commodity prices today. So we -- there is another metric that we are not allowed to put on paper, but there is three times upside. So I remain confident that there's still significant upside for investors.

Just finally some guidance and I'm not going to go through it in detail. Probably the only one I want to refer to was the Marikana operations, which are a little bit below, let's say, what we would see as a steady state run rate and I would suggest that because the first half of the year, still a lot of reorganizing and disruptions. But there you have the guidance.

All right. So final slide, let me just conclude. ESG framework to guide the running of our business. You've seen it. The improvement in safety is contained in that, looking off the communities around us. And the same applies. We will always do what's right. We can't be bullied by people that demand tenders that don't even live in our communities. So, I hope they are listening. We will become a reference producer in terms of the green space. I gave you some guidance to that.

I think in terms of value creation, we are a significant precious metals producer and we did that through some very smart organic growth and M&A. And we've had successful integrations, there's no reason why Marikana won't be successful. Our gold business remains challenging, but I believe Shadwick and his team are doing the right things. It's been restructured, a smaller footprint, and they will no doubt take it forward in a positive way. Marikana, as I say, the integration, we have a track record, you've seen the plans, you've seen the estimates, and that is looking very positive.

We've increased our strategic stake in DRDGOLD, and that was also strategy, both from a commercial point of view, and of course what we can do together in the future.

Again, if anyone has just come on the call at this point, I want to make it clear that our balance sheet de-risking has essentially taken place, getting down gross debt is the next focus area in terms of that, but it's a very, very high priority to restart dividends with probably with our interim results. So, with that, I'd like to conclude. And of course I'm going to ask my team to handle most of the questions. So thank you very much.

Questions and Answers:

Patrick Mann -- Bank of America -- Analyst

Hi, it's Patrick Mann from Bank of America. Well done on a good set of results. I wanted to ask why not resume or restart the dividend now? I mean as you say, prices are up another 40% year-to-date. On a pro forma basis, you're well below 1 times, and you could have paid a 25% to 35% payout ratio. So, is there any signaling there that you're cautious on these prices or what's the thinking behind not resuming dividends now?

Neal Froneman -- Chief Executive Officer

Thanks, Patrick. And a good question, and it's something we deliberated at our Board meeting as well. Look, I think, in essence, our priority remains deleveraging and we would like to see our net debt position lower before we resume dividends. That's really the answer. If the surge in commodity prices had happened a month or two earlier, we may have made a different decision. So no, it's not, it's not a concern that this is a bit of a bubble. It was we want to get our net debt down. And we had also given guidance at a high level that it would probably only be in August. So we didn't want to surprise our shareholders as well. So we wanted to be consist. I know it would have been a positive surprise, but still it's a surprise.

Suvish -- Analyst

Thank you, Neal. It's Suvish [Phonetic]. My question is around the statement which was released in the past week by DRD, they are moving to the PGMs now. Now, I would be interested, if what has been the influence of the transactions and your price value, in terms of acquiring more from DRD.

Neal Froneman -- Chief Executive Officer

Well, maybe I must DRD to answer that one. Do you mind if ask, I mean, yes, I think we've influenced a bit. But, Niel.

Niel Pretorius -- Chief Executive Officer

Thanks, Neal. I think the -- you made a point earlier that forward-looking strategy is to develop opportunities. And for us to be in the Sibanye slipstream, which is a big slipstream, is a very good place to be. Already we've been given the opportunity to develop these wasteland assets, and to not express the desire and position ourselves to also see if we can get involved in Sibanye's is very significant platinum tailings. If we don't do it, they might pick somebody else and that could be a bad day for us.

Suvish -- Analyst

Thank you.

Neal Froneman -- Chief Executive Officer

Arnold?

Arnold Van Graan -- Nedbank -- Analyst

It's Arnold Van Graan from Nedbank. Question for Charl. So how much additional working capital have you tied up in the recycling business over the past six months? And then, just another question on that, just confirm that you're still not taking any price risk on that material.

Charl Keyter -- Chief Financial Officer

So in terms of working capital tied up, obviously we've effectively doubled that. But where are you on now. Okay, sorry. Just want to make sure I -- yeah, on the recycling, apologies, on the recycling. So we've effectively doubled that, and that's because of the price that's gone up. And we are still not taking price risk on it. So that is confirmed. Obviously, we bought in at a price, and then, we obviously sell it at a price, and we take the marginal of the top.

Neal Froneman -- Chief Executive Officer

Leroy?

Leroy Mnguni -- HSBC -- Analyst

Good morning. This is Leroy Mnguni form HSBC. My question is around the sustainability of your dividend, once you resume. So you've guided the market on a number of potential areas, where you're interested in acquiring assets. Some of them, it seems that could be sizable acquisitions. What are the timing of those based on your expectations? And how will that impact the dividend?

My second question is, given where commodity prices are right now and some of the forecast that you've showed us, would it be cheeky to expect special dividend above your policy when you do resume dividends? And then could you just maybe give us a bit of color on the recycling industry at the moment? The market expects that there will be an increase in supply from recycling. What are some of the headwinds that you're seeing that will prevent an acceleration in supply growth from recycling?

Neal Froneman -- Chief Executive Officer

Okay. So, can I ask Richard to address the last question. I'll just address the -- your first few, Leroy. So, I think that both our shareholders and previous shareholders have made it very clear that we can't keep on stopping and starting dividends. We did it because we had to buy Stillwater and use debt and you can't be leveraged the way we were. I would -- and in fact, our Board has expressed the same -- the same concerns that when we start, we have to start in a smaller way, but however we start, it's going to be sustainable. So, the sustainability of our dividend going forward, irrespective of any further, let's say, use of capital for M&A or projects or whatever it may be has to be sustainable and will be sustainable. We come off a very different base. So, I think you can accept that with confidence that we will have to cut our cloth to suit on any further M&A. And yes, it is something we are considering. But I want to make, again just very clear the priority is deleveraging, reinstating the dividend and if there is anything to do, it's got to be value accretive. We're not deal junkies. We need to replicate what we've done in the PGM sector. So, it's not just because we now have money, we can embark on M&A. We are looking for those value accretive opportunities, but it's only post doing what we're doing now.

The second part of your question is related to extraordinary dividends. And yes, I think we would like to do that if it's appropriate, the one thing we've discussed at Board level, but we've made no decision. So, please let's be clear on that. We've made no decision on this, but there is a chance that we'll consider extraordinary dividends from our gold business once we've paid an ordinary dividend from our PGM business. But that's still a final discussion that's got to take place at Board level. But I think it's appropriate, if you want to be an industry-leading dividend payer, you better be -- do more than just pay ordinary dividends. Rich?

Richard Stewart -- Executive Vice President: Business Development

Thanks very much, Leroy. So I think when it comes to recycling there are three major factors you've got to consider. So, the first one is the age of the costs. So, generally speaking costs get recycled off about 12 years, it's a good average. So what can come on to the market now, I think -- produced 12 years ago, that's going to be a different implication for platinum and palladium in terms of obviously more recently, we've seen a lot of palladium cuts relative to platinum and hence the reason our outlook is for recycling on platinum to be a lot flatter, while palladium will continue to grow.

The second major factor is how much actually gets recycled. Historically, we've seen about 50% of cuts actually make it back. We view that assumption going forward in our model, but given that the market is getting bigger, one may argue that actually might be quite difficult. In absolute terms, it's getting bigger. That might be a difficult number to maintain going forward.

And the third one critically is actually around the ability or the facilities in order to do the recycling. Generally speaking, recycling is done where there is spare capacity in facilities. It's not that economical to build facilities purely for it. So for example, ours is spare capacity, primary production will always take priority and that capacity is limited. So, again, looking at -- we have actually not constrained our models by facilities. But that is a real constraint that is coming across the market now and hence the reason our conscious be turned on that quickly. So we do see that increasing in palladium, in particular. But the other metals still being fairly constrained and flat in terms of secondary supply.

Charl Keyter -- Chief Financial Officer

At the back?

Thobela -- Cachalia Capital -- Analyst

Hi. Thobela from Cachalia Capital. I have a few questions. So the first one is about two years ago you had indicated that the substitution would gear down about between $400 and $500 an ounce, which is the differential between palladium to platinum. And clearly, that hasn't really occurred [Phonetic] sort of the price differential doesn't seem to be a factor. So what do you think is causing the resistance to substitution? I mean what are you seeing, especially given that you have now SFA, which does research into these things, what sort of market data are you seeing from that perspective? That's the first question.

And then the other one is, at what basket price would use that investing in increasing your output, especially given the fact that you've already stated that the US basket price has risen by over 25% this year and then in rand terms that's close to 40%? So at what basket price would you sort of reinvest and putting more output?

And then the other one is, with regards to Lonmin, would there be broad-based generation one closures, especially given where the prices are currently? So would you still just continue with closing those shops? And then related to that, is Lonmin had planned to sort of reduce labor by about 12,600 people. So how many jobs do you think you could save given the movement in the basket price since you took over the operations? That's all.

Neal Froneman -- Chief Executive Officer

Okay. Yeah. There's a lot of questions there. Rob will you pick up the Lonmin stuff and -- but let me try and -- your first question was about substitution. And the first -- we always envisaged together with some of the analysts, one sitting here, that $400 to $500 an ounce was the trigger. But we always qualify that as well by saying that that's the point where I think end users would start doing the work. Today, to make those type of switches there is quite a lot of -- it's quite onerous. There is competing technologies. So, first of all, end users are doing a lot of work in the battery electric space and it's not a big issue for them, a $400 to $500 price difference, it really makes very little difference on a car. But I think they are also concerned about all the permitting issues, the licensing issues and if they get it wrong, the fines are humongous. And I mean, it's a sort of class action you have against someone like Volkswagen.

So I don't think it was just the price and certainly they had other priorities. So I don't think that is why we saw any real progress on substitution. The real progress that we're seeing now is what I explained in the presentation and that is that they are real potential shortages of rhodium and palladium starting to develop. And when a car doesn't move out of the factory, that is -- it's not just the cost of the PGMs and the exhaust pipe, but they've lost that sale and they've ground to a halt. So, yeah, I think there is different factors driving substitution and the work that's being done. But that is happening. That is actually happening. I mean, we far exceeded the $400 to $500 price range.

I think the other thing that we might not get told as bluntly as I'm going to say, when they move into platinum, they are predominantly taking a bet on South Africa, and I don't know that we have such a good track record in the more recent years about a business-friendly environment. And I think they probably sit back and say we're now exposing ourselves to reliance on platinum as well. Palladium, we can get from Russia and North America and so on.

In terms of your next question, I wasn't sure whether you are relating it just to Stillwater when you spoke at the basket price to grow more output or to the entire business. But -- the entire business. Okay. So, Rob will pick up the South African side. Chris is on the phone. But I'm going to just to make it easier, I think, and then ask Chris to comment on the Stillwater side. The -- we have -- Stillwater is certainly capable of producing more if we were to spend more in capital. It's got a huge resource and certainly, it's got long life. So, commercially, I think, it would make sense to produce more. However, I think we are very respectful of the -- of all the stakeholders in that area that have allowed us to go to about 1 million ounces once we've ramped up Blitz and once we've done Fill the Mill. And I don't -- I sense that they would not be happy for us to do more. To pristine area, they are -- there are issues around traffic and so on, and I think we want to respect their rights and probably leave it at that sort of output and rather have the life.

Palladium also, I mean, if you look past 2028, palladium has a lot of exposure to internal combustion engines and things start getting a bit vague there. So, I think if you're not in the palladium business now, you know what, making these investments that take four, five, six years to bring on stream, you're probably not going to get into it and it's risky thereafter.

Rob, do you want to comment on the other questions, including the -- so it doesn't matter what the basket price supports further investment, but in the US, I don't believe we would increase output.

Robert van Niekerk -- Executive Vice President and Head of South African PGM Operations

Good morning, everybody. Insofar, as the Generation 1 shafts are concerned, that was actually part of the restructuring we've just been through. Over the last six months, we closed East 1, which was staffed largely by contractors. We've also closed East 2, sorry, I mean, West 1 and Hossy shaft. So those three Generation 1 shafts have been closed. 4B remains open and it appears as if we've got a life of mine at 4B from anything from 12 to about 24 months and in doing so we managed to save just over 3,000 jobs.

The workforce or the number of employees including contractors has decreased by almost 7,500 people in total since we've acquired those assets. A very small number of those people actually retrenched but there has already been a significant number of reductions over the last seven months.

Insofar, as future production is concerned, we're currently busy looking at K4, we've opened that book again. We're busy doing that evaluation. We're also looking at the Pandora area and we hope to have those evaluations completed by the end of the year. So...

Neal Froneman -- Chief Executive Officer

Yeah. And just to add on, again, I think the current basket price and for instance, Kroondal went over ZAR40,000 a 4E ounce this morning. Supports expansions, but until we see platinum move from a surplus into a more balanced market, it would be irresponsible to produce more just to get the benefits of palladium and rhodium. We really have to think about these things in the basket and get the balance right.

Martin Creamer -- Mining weekly Online -- Analyst

I am Martin Creamer from Mining Weekly Online. Can you give us some of the volume, the estimated volume of Platinum Group Metals in tailings dumps? Can you tell us where is the main volume? Is it South Africa or US? And then what is the bias, is this sort of palladium rhodium bias? And if so, could it not be a -- taken into account, fairly quickly, would it not be in your interest to do that fairly quickly or the technical hold-ups for Platinum Group Metals being taken off tailings dumps?

Neal Froneman -- Chief Executive Officer

Yes, look certainly, I have a view, but why don't you, and -- you've done a bit of work on it already, why don't you just go first, Rich?

Richard Stewart -- Executive Vice President: Business Development

Yeah, thanks Martin. As I couldn't give you across the entire industry, but speaking from our side, I mean at the moment, we've got about 3 million ounces that we have put into proved resources or mineral resources across our various operations that will be Rustenburg and Marikana. There are quite a few dumps that we haven't yet completely drilled according its resources. There is still some upside on that number. Listen, I'd imagine you could times that by three or four for the industry as a whole.

I think the tailings opportunities in -- significantly with PGM, I mean that Neal will comment, because I take it a step further Neal's asked and we've answered, we are certainly going to be doing work together on that, because we do think it's significant. It does of course play quite a significant role at Rustenburg already. So there has been surface treatment. I think the technology has improved, the ability to extract has improved. Similarly at Lonmin, they started on the Marikana operations, they started a project two years ago. So technology exists. As they with, I don't know what is it, 20 years, 30 years worth of learning in gold, there's a lot that we can take across to enhance that at the PGM side. And that is certainly what excites us. And hence the relationship with DRD. Neal, then if you've go anything to add?

Martin Creamer -- Mining weekly Online -- Analyst

Thank you.

Neal Froneman -- Chief Executive Officer

Yeah, the only thing I would add to what Richard has said is, clearly in the US, there is an opportunity, it's not as because South Africa. But what we have in the US is high quality tailings. You're mining 15- to 20-gram a ton, primary production, so your residues are a much higher than they are in South Africa. They're going to be 3 or 4 times higher.

Rene Hochreiter -- Noah Capital -- Analyst

Hi, Neal. Rene Hochreiter from Noah Capital. Congrats on turning Marikana around, and the gold division as well after that strike that you had, and setting up the company, especially with your foresight about two, three years ago and setting up to take advantage of what the markets are, right -- like right now. Just a little bit disappointing, was the AIC cost increases, they were up sharply on the previous year. I Understand about Lonmin, I understand about the strike that you had. But still a little bit disappointing, but what's a little bit more disappointing is that your cost guidance was up on those numbers. So maybe, I know you're taking advantage of the good market at the moment.

Neal Froneman -- Chief Executive Officer

Yeah.

Rene Hochreiter -- Noah Capital -- Analyst

But also in the absence of any further mergers and acquisitions, like you've been trying to do these last few years, which is a right decision, but anyway, what sort of cost increases could we expect going forward from Sibanye in a sort of a steady state situation?

Neal Froneman -- Chief Executive Officer

Yeah, yeah. So I think your disappointment is ours as well. And we've certainly put these cost numbers through the ring here to try and see what is happening. And Rob, maybe you want to comment about what's driving it better. The one thing you've got to factor in this is when you look at unit costs, is the volume aspect, the volume especially, if you look at costs on a dollar per ounce basis, you've got factor in this, is volume increasing or decreasing because of relatively high fixed cost. Nevertheless, we are also cognizant of exactly what you've seen and we understand the disappointment. I think we will do much better, but again Rob and Shadwick you can just comment on your own views. What we've taken opportunity, I think to try and put conservative numbers in the market and that's also part of the problem, you can be so conservative that you disappoint. So, I really do believe we can over deliver, but they are real cost pressures that we're seeing. It's almost like everyone jumps on the bandwagon when they see increasing commodity prices and we get all these applications for increases in contracts and so. That's not -- it's not our team that sits back, says, we've arrived and there is more margin now. It's not that at all. But we take your comments, Rene and we will look at it. So you want -- listen, normally, I think you've seen us do better than inflation year-on-year, once we're in steady state. And how we do that is, we try and work out what we can. For instance through synergies and economies of scale, we try and work out a few percent of that 5% or 6% by renegotiating contracts doing things smarter. We actually consciously do that.

Looking forward, other than electricity, what I can say is, we will probably have an average increase of about 5%, 6% on steady state production on costs. That's what we try to work toward. Electricity pushes you and electricity is 20% flat. Now, if your cost pushes that up by another few percent, because you're talking 12%, 14%, maybe 16% here, hard to give you an exact number. But do you want to -- both of you, just share with Rene and the rest.

Shadwick Bessit -- Executive Vice President: SA Gold Operations

Yeah, Rene look, I think Neal is right. I mean we are also concerned about it. If you look at what we did in the second half of last year, in terms of all in sustaining cost, we averaged about the second half ZAR636 [Phonetic]. We've now given guidance that says ZAR635,000 to ZAR675,000 [Phonetic]. Neal is also right, the high percentage of our cost is fixed. So what we are working on at the moment is to try and reduce the amount of infrastructure that we have to manage. Neal alluded to the fact that we reduced the number of plants, reduced the number of shafts. So we are still in the process of trying to do that. In fact this year, we are planning the process of taking two shafts that are coming to the end of the economic life out of the equation next year as well, to try and reduce that fixed cost base. Because the fixed cost base is about 70% of our cost is fixed. So we -- that's something we absolutely have to do.

I'm also hoping, to be very honest with you, we're going to be on the lower end of our guidance, if not possibly be at that low-end. But there's a lot of work to get us there. But I'm hoping we're going to be on the lower end. So there is work to done, Neal, and I think you are right, we all try and get number down, so that we can get our margin between that cost and the price, a little bit more in a comfortable situation. Thank you.

Neal Froneman -- Chief Executive Officer

Rob?

Robert van Niekerk -- Executive Vice President and Head of South African PGM Operations

Rene, -- about what Shadwick and Neal has said, I think the only other one I want to put it in the mix is the tax royalties, associated with increased metal price. If we look at the tax royalties at spot versus what we were paying last year at the same time it is ZAR400 to ZAR500 range per ounce more. And that's just on tax royalties. So that is the only thing I would like to add the price of electricity and inflation and so on.

Charl Keyter -- Chief Financial Officer

Yeah, just to remind, it's ZAR35 an ounce for the SA PGM assets, but it's ZAR60 an ounce at our US PGM, and that's just year-on-year. Now if you look at from the time when we acquired Stillwater to where the prices of today, that is in excess of ZAR100 an ounce. For every ZAR100 move in commodity prices at Stillwater, it's about ZAR7 an ounce movement. So if you take ZAR2,100, we acquired at ZAR700, that's a ZAR1,400 announced differential, which at ZAR7 to an ounce is close to ZAR100 an ounce. So that plays a significant role.

Rene Hochreiter -- Noah Capital -- Analyst

Okay, thanks very much.

Arnold Van Graan -- Nedbank -- Analyst

Neal, sorry, I just want to continue on this cost line. So is part of the problem not necessarily cost, but cropped up staying business capital. So, and on Slide 19, you showed that your capital expenditure is basically in line with the previous owners. But if you look at it over a longer timeframe, you could see capital numbers are actually down quite a lot. If you go back further, it's down more than that. So is that not one of the big drivers of all-in sustaining costs? Is all these capital numbers should have been spent in the past, it's not fleet replacements and other maintenance that is now being caught up? Is the element of that in driving these all-in sustaining cost levels?

Neal Froneman -- Chief Executive Officer

Yeah, I don't believe so Arnold. It's not like these catch up capital. Our capital numbers are very consistent, and were they not we understand exactly what the difference is and it would be a feasibility study of ZAR60 million units at BlueOak [Phonetic]. And so, no I don't believe it's in those numbers. It's that -- I didn't mention the royalties that Rob brought up, but that's a big part of the cost. But they are real inflationary pressures.

Yes, James, have you got a question?

James Wellsted -- Head of Investor Relations

No, no. Just want to say Arnold, I mean, if you look at the gold capex, it's about, I think ZAR3.3 billion, ZAR3.4 billion. And a lot of that, these extra capital that we're spending are clear for the integration of their shaft. So that's going to come often in the next year also. So there is innovative capex, but it's related to the restructuring going forward. And then quite a lot of the cost increase is obviously, volumes, in the US, behind in terms of the production buildup at Blitz obviously. So that volume, lower volume, obviously has an impact on costs, as we build the production up, that will come back down to where we expect it to be.

Marikana obviously, as the cost synergies come through that will come down as well. And I'm not sure, if Rene, but at Rustenburg, have you factored in the toll going from park to toll. Obviously there, we obviously add the tolling fees on to our costs, but they get a 100% of the basket, which obviously, in this price environment is a lot more beneficial.

Neal Froneman -- Chief Executive Officer

Thanks, James. We got questions on the call?

James Wellsted -- Head of Investor Relations

Yeah. Can we go to the call please.

Operator

Thank you very much, sir. First question comes from Dominic O'Kane with JPMorgan.

Dominic O'Kane -- JPMorgan -- Analyst

Hi. Three quick questions. This question has been asked on M&A, but in a slightly different way. You talked, obviously, we plan to go around that a huge decision on the location of your listing. So is there any interplay between you making decision on the bank [Phonetic] waiting M&A opportunities. So specifically, would you see making a relisting decision as a pre-condition of future M&A.

My second question is on the synergy number. You've upped your total synergy number to around about ZAR2 billion per annum. Could you maybe give us a little bit of insight, what you're seeing on maybe the longer-term mining synergies, specifically, around cross boundary mining in Rustenburg? And then I mean, finally, I'm not sure if this question has been asked, but with respect to long-term -- longer term production guidance of Marikana, could you maybe just give us an indication, we think on the capex, the longer-term capex number of Marikana? So I'm assuming ZAR115 million of capex, there is kind of a, is a high water number.

Neal Froneman -- Chief Executive Officer

Okay, Dominic, I'll ask Rob just to pick up on the Marikana and SA PGM issues. In terms of listing, I think, where we are now thinking is, certainly certain M&A could trigger something that is, let's say, smart. But that's not our primary focus. I think our primary focus is at the right point in time, a listing consideration may make sense. In other words, there is no point in changing your primary listing with a majority of assets in South Africa today. I don't think it will have any impact, and it will be more trouble than it's worth.

I think once you have a much larger international asset base, considerations to a change in primary listing will make a lot more sense and will be far more appropriate. So yeah, I hope that clarifies the first part of your question. If I can then just ask Rob to deal with the second part.

Robert van Niekerk -- Executive Vice President and Head of South African PGM Operations

So, as far as the cross-border, the cross-boundary mining synergies are concerned, we haven't built any of those into the numbers at this stage. Our synergies are going to be significant, especially between the Kroondal operations and the Rustenburg operations, as the Kroondal operations want go deeper, or possibly mine leading to unwind territory and which is owned by Bathopele, but those are predominantly where our specific synergies resolve. We haven't done any work on that. So none of that is brought into the numbers at this stage.

A hard number for the capex at the Marikana operations going forward is approximately ZAR150 million per annum. This coming year, we're looking at spending ZAR1,6 billion, ZAR1,7 billion, and going forward that will probably go up to a little bit more than ZAR2 billion.

Dominic O'Kane -- JPMorgan -- Analyst

Okay.

James Wellsted -- Head of Investor Relations

Thanks, Dominic. Does that answer your questions?

Dominic O'Kane -- JPMorgan -- Analyst

Yes, thank you. Thanks.

Operator

The next question comes from Adrian Hammond of SBG Securities.

Adrian Hammond -- SBG Securities -- Analyst

Hi, Neal. I have three questions. Firstly, you've done some hedging on palladium, was that sort of opportunistic? Or do you have a hedging strategy now going forward? And would you do some more? Secondly, this South African gold portfolio, you've now separated from the platinum assets, do you see SA gold remaining in your portfolio to address your South African discount? And then lastly, just on, I think a small question for the DRD, the Phase II capex of ZAR3.5 billion [Phonetic], where do you see yourself on that matter and how would you fund it please? Thanks.

Neal Froneman -- Chief Executive Officer

Yeah, hi, Adrian. Look I think it's prudent to consider, palladium prices are, you know, we did take a position at ZAR2,500 an ounce. We did an financial instrument. Certainly, I don't know why we would do another ZAR1,000 or ZAR2,500, perhaps a little bit higher we will give consideration to that. We haven't made any financial decision, but I think that could be prudent, especially when you've got a project in buildup phase, we don't want to hedge everything in our portfolio. Shareholders we know like exposure to volatility. So those will be carefully considered. But we will do what is prudent.

In terms of your next question, which was really around the gold business. Look it, certainly part of our South African discount, but I must tell you we like the combination of gold and PGMs, and so do many of our investors that we speak to. They see it as quite unique. And in fact, what we are really starting to understand is that PGMs, although we put it under precious metals banner, or industrial metals. And any global economic turmoil you will see very different PGM prices. And if you couple that with gold being considered a safe haven commodity, which it is, and it responds positively to those type of things, it's nice to have both in the portfolio. If we were to ever do something with our gold business, I think it has to be off the basis of a much bigger gold business to make sure that we retain that golden PGM portfolio.

Your third question, I forgot, but it was -- it was for DRD. So yeah, let me hand it over to Niel Pretorius.

Niel Pretorius -- Chief Executive Officer

Thank you, Neal. Hi, Adrian. Adrian, following the exercise of the auction and also taking advantage of the higher gold price, our cash position looks quite a bit different. I think at the end of the reporting period it was sitting around about ZAR1.5 billion. Considering further that, at the time, when we did the transaction initially with Sibanye-Stillwater, the capital number at the high-end of the estimate, at the high-end of the range was roughly 2.5 times our market cap. Now that's less than a third of our market cap. I think relatively speaking, the ability to fund this may be moved quite a bit.

On top of that, I think we may have mentioned that we are looking at a number of options and not all of those assume the high-end target for capex. We are looking at a different models which could bring the total capex number to well within what our cash position is at this point in time. So maybe the short answer to the question is that, there are other problems that the industry faced, that are bigger than the project funding challenges associated with Phase II of this project. I think it's well within our means both in terms of the lower end and also the higher end of the -- of what we estimate that project capex might be.

Neal Froneman -- Chief Executive Officer

Thanks, Niel.

Operator

Adrian, does that conclude questions?

Adrian Hammond -- SBG Securities -- Analyst

Yes, thank you.

Operator

Thank you very much. The next question comes from Alex Ayoub of Waha Capital.

Alex Ayoub -- Waha Capital -- Analyst

Hi, thank you very much for the presentation, and really, congratulation for these amazing results. I have three questions. The first one relates to the leverage. We understand you want to decrease your leverage to one time, and then focus on paying dividends and potentially an extraordinary dividend. Is the target to keep the leverage around or below one time in the medium-to-long term? That's the first question.

The second question relates to, sorry, can you hear me?

Neal Froneman -- Chief Executive Officer

Yes, we can hear you clearly, Alex. Go ahead.

Alex Ayoub -- Waha Capital -- Analyst

Thanks. The second question and relates to the palladium prices. I think you briefly touched on it and maybe I missed it, but just trying to understand why do they keep on going higher, even when core sales are going down and you're having more and more electric cars coming to the market.

And the third question relates to sensitivities to FX. How much of that have you hedged? And can you just tell us if possible by how much would your EBITDA decrease if rand I appreciate or depreciates by ZAR1? Thanks a lot.

Neal Froneman -- Chief Executive Officer

Okay. I'm going to pass the financial questions on to Charl, and the palladium question on to Richard. Charl, you go first, please.

Charl Keyter -- Chief Financial Officer

Yeah, thank you. So in terms of ZAR1 move, if you just look at our revenue for 2019, it was $5 billion and that was off the back of ZAR15. So, that's about a sixth that will come off the revenue line, which effectively, the net effect of that will be 0.7. So if you take a six of the revenue line, that's about -- what's that's about ZAR700 million, you take off, so it's about ZAR500 million that the EBITDA will decrease by post tax.

In terms of currency hedging, we haven't done any currency hedging. And as Neal said, shareholders are not to favorable when it comes to hedging decisions. And we don't take that lightly. And I can't remember what the first question was...

Alex Ayoub -- Waha Capital -- Analyst

On the leverage, just wanted -- yeah.

Charl Keyter -- Chief Financial Officer

Yes, so I mean there is no absolute answer to that, do we want to keep it at 1 times. I think where we don't have other uses for the cash, i.e., returns to shareholders, any projects, obviously we will pay down debt further to that number. But as we've said, our immediate target is to take the gross debt down to ZAR1 billion. So there is no specific answer to that. But we are very comfortable, as I said at ZAR1 billion, covenants are not an issue and leverage is not an issue. But that's obviously, once we reach that target, we can obviously decide how we go forward on that basis.

Alex Ayoub -- Waha Capital -- Analyst

Understood. Thanks.

Operator

Gentlemen, we have no further questions for the line.

Neal Froneman -- Chief Executive Officer

There is still one more answer.

Richard Stewart -- Executive Vice President: Business Development

So just to quickly address your palladium question without going into too much details, based on very basic supply and demand fundamentals, palladium has been in deficit now for almost 10 years. And those deficits have been made up by surface stockpiles predominantly coming out of ETFs and other working capital requirements. But those have now dried up. Forecast looking going forward is that we're still looking at anywhere up to 1.5 million to 2 million ounce deficits per annum up for the next five years. So these are substantial deficits that are coming through, and really there has not been an answer as to how to change it. The slight drop off in vehicle demand, it has come off a little bit, but we're still looking at an average of about 2.7, 2.8 growth rate per annum globally. That 2.7 to 2.8, the total market penetration of EVs is less than that. So in fact, the number of cars that are growing, that still require PGMs is still growing annually quite substantially. And then as Neal indicated in his presentations, you've got loading is going up. So fundamentally we've got no short-term supplier solutions. We've got increasing demand and certainly for the next five years, there are still substantial deficits coming through. So those prices have been rising, and I do say, there is nothing obvious that suggest that picture is going to change in the short-term anyway.

Neal Froneman -- Chief Executive Officer

Thanks, Richard.

Alex Ayoub -- Waha Capital -- Analyst

That's very clear. Thank you very much.

Operator

Apologizes gentlemen. There are no further questions from the lines now. Thank you.

Neal Froneman -- Chief Executive Officer

All right, thank you. James, got anything?

James Wellsted -- Head of Investor Relations

Yeah, thank you I'll read from the webcast, I've got some questions, which have been sent through. First of all, Steve Shepherd. Congratulations on a positive set of results, guys. Just the beginning, aiming to that. My question is that, given the -- and the valuation of your shares that you've highlighted clearly in this presentation and the powerful cash flow you're enjoying, do you think it would make sense to return value to shareholders by buying back your shares?

Neal Froneman -- Chief Executive Officer

Yeah, Steve, thanks. I appreciate your comments. Absolutely, I think at the time where we actually make a decision on how to utilize, let's say excess cash depending on where our share price is, that could be a very smart thing to do. So this is something we've spoken about. We're not quite there yet on let's say what is the best use of proceeds. There is still a long way to go, but that would certainly form part of the mix.

James Wellsted -- Head of Investor Relations

Okay. Another one from Chris, sorry, from Steve was, could Neal please share with us his latest views on power generation? Is Sibanye-Stillwater going to proceed with its generation plans? And is the government really going to open the group?

Neal Froneman -- Chief Executive Officer

Yeah, very, very complex set of conditions that have to be considered. So I think it's positive that the Minister and the President confirmed it in SONA, have agreed to, let's call it self-generation. That's a big step forward, and I would argue that, that business was responsible for creating the pressures to get those approvals. However, they are still hurdles and it's not that clear to us exactly what the process is going to be. We've got technical teams working with the Department of Energy and the regulator and Eskom, on these things. Because the hurdles to getting into self-generation were not just from approvals from the Department of Energy, but Eskom made it very difficult, they wanted to renegotiate guarantees that are in place. They had unrealistic connection fees. It was -- they were all put in place to make it unattractive for companies to generate their own power. There is a different wind blowing, but there are still -- there is still clarity required in certain areas. So that is all positive. However, and that was made very clear to me that government would not buyback excess power. Now you get into the difficulty of you have to make decisions now, that you're going to commit for 10, 15, maybe even 20-year type of contracts or investment models, because the returns are relatively small. And you're doing that in a climate that I would still argue is not investment friendly. So, it's challenging. It's not simple. There is many facets to this.

In terms of our own projects, the 150-megawatt project for gold is being reconsidered, but it will probably be a smaller project. It can only be a bigger project if we wield power to Rustenburg or we can sell power back into the grid. The life of those mines or quite a bit shorter than they were when we started with the project. And then we have a new operating area, so we have -- our center of gravity has moved to Rustenburg. And we probably need to start from scratch there.

In terms of, is that a good thing to do. Yes, I think it is. But it's going to have to stack up against any other investment, reducing our carbon footprint is becoming important. Our ultra-deep level gold mines consume a lot of energy per ounce produced. And of course, most of that, well all of that energy is coming from Eskom that uses coal. We are be coming very, very sensitive to issues like that. And they could be significant driving forces in terms of what we do in the future regarding exposure to certain assets. So Steve, I don't have an absolute answer for you. But those are the things that need to be considered with regard to self-generation of power.

James Wellsted -- Head of Investor Relations

Thanks. The next question is Chris Nicholson from RMB Morgan Stanley. Has there been any inventory pipeline build at Lonmin's processing operations, i.e. does reported production equal refined sold? And then secondly, and I think we've answered this, oil prices at a level where we can commit to developing projects at Marikana and when? And I think, we said we're looking at them and we'll have an answer by mid-year. But maybe the first question on the inventory, and reported -- produced or sold as produced.

Neal Froneman -- Chief Executive Officer

I see Robert's pointing to Richard.

Richard Stewart -- Executive Vice President: Business Development

I think the short answer on the pipeline is no. There hasn't been any significant change, broadly speaking, it doesn't match. So we haven't had a big buildup. I think what we are doing slightly differently, because of the cash position we are in, we are trying to manage those operations in fast and smoother fashion. I think historically, there were big draw downs at year-ends etc., and then big builds up, which led to quite a variable pipeline. We are trying to run the operations in a fast and smoother manner, which is better for productivity, but there is no significant build ups.

Neal Froneman -- Chief Executive Officer

Thanks, Richard. And I must point out that Richard is responsible for PGM market development and the refining part of our business. So that's really where the pipeline happens. Rob is responsible for the mining, the smelting and the base metal refining. So just to put it in context, why I was pointing to Richard.

James Wellsted -- Head of Investor Relations

Next question, Philippe Vasconcelos [Phonetic]. Good morning, Mr. Froneman. Congratulations to you and your team. I'm a happy shareholder for quite some time. I would like it, if you could, if you made some -- I would like to know if you've made any decisions on EV metal investment.

Neal Froneman -- Chief Executive Officer

No, we haven't. We are still doing that work, Richard, probably second quarter, we could expect some output. But I think again, we never answer these questions. I know journalist is going to say, Sibanye is moving into battery metals in the third quarter now. The priority remains deleveraging, reinstating our dividend then considering these type of things carefully. But second quarter, we should get our first lot of output, Richard, from the study. Yeah. [Indecipherable]

Yeah, yeah, that's right. We won't be in a position to make a decision. We will just have further clarity on what are the metals, where are the best places, we then need to still do a lot of work.

James Wellsted -- Head of Investor Relations

Next question, Matthew Abbott, [Indecipherable] Capital. I think we've answered most of it. So just a question on the excess, on the deleveraging, are we looking to buy back bonds in the open market? The math on the slides is well below the issued amount, obviously, following the buybacks.

Charl Keyter -- Chief Financial Officer

Yeah, so just on that, now I think our first quarter call, will be to pay down our revolving credit facilities. So there is no immediate plans on the bonds.

James Wellsted -- Head of Investor Relations

Thank you. Next question is from Roger Williams at Centaur Asset Management. Just on the outlook on other costs, particularly the care and maintenance costs, does the debt of ZAR1.497 million include convertible bond market value? Or original issue price? And then the costs at Stillwater are around ZAR200 [Phonetic] more than original projections, can we reconcile the difference? And what is the steady state outlook in 2022 at Stillwater?

Neal Froneman -- Chief Executive Officer

So, listen, can we just go through those one by one. So...

James Wellsted -- Head of Investor Relations

Okay, let's go one by one. Okay, so first of all, other costs of approximately ZAR1.8 billion, particularly care and maintenance.

Neal Froneman -- Chief Executive Officer

So Shadwick, a majority of those are your costs.

Shadwick Bessit -- Executive Vice President: SA Gold Operations

Yeah, [Indecipherable]. So from care and maintenance point of view, I think our biggest cost sits on our Cooke operations. We have obviously applied to close those operations, which is essentially Cooke 1, 2 and 3, as well as Ezulwini shaft. So those are the ones that we are considering. There are two shafts that we are considering for next year, before we see closed Driefontein 6 and 7. So that care and maintenance will disappear, so to speak. And then obviously for 2021, there is two more shafts. And the question previously, from a fixed cost point of view, that we also considering taking those ones out of care and maintenance and issue closing them down. So, yeah, these [Phonetic] cost, particularly on the Cooke side that we hope are going to get a favorable outcome to close those operations.

Neal Froneman -- Chief Executive Officer

Yeah. No, we will certainly drive it in that direction, Rob. There's nothing really on your side there. Okay, next question.

James Wellsted -- Head of Investor Relations

On the dates, does it include the converts at the market value or original issue part?

Charl Keyter -- Chief Financial Officer

Maybe just another comment on other cost, there is also some extraneous costs that we had to incur in terms of the strikes. So, those costs will not be repeated in 2020. And that was about ZAR400 million. On the number you are quoting, that's the net debt number of about ZAR1.5 billion, that does include the convert at market value. But that's the net debt. So it also includes cash on the balance sheet.

James Wellsted -- Head of Investor Relations

Okay. And then the question on Stillwater costs. I think we've spoken about the fact that volumes are a little bit lower than what we expected at this time. So that's one of the factors, and then also the royalties is another significant factor adding to costs. And then, steady state outlook would be, as the production builds up, it resumes back to the normal profile with royalties factored in, obviously, at very basic prices, but.

Neal Froneman -- Chief Executive Officer

Yeah, well you've answered it.

James Wellsted -- Head of Investor Relations

I've answered it. Can we -- OK, we've also the solar project. And then last one, I think before we call it the day, because we're already at 12 now. Considering the synergies of more than ZAR1 billion a year, that you've unlocked from the merger between Rustenburg and Marikana, what is the scope for synergies with the Impala lease area. If one presumes that both groups would retain ownership of the underlying metal streams for EU and Competition Commission means?

Neal Froneman -- Chief Executive Officer

Yeah, look I think that could be smart business, but it's not something that we focused on, and certainly it would have to be very carefully considered around competition issues. But yeah, certainly anything is possible, you just need willing parties on both sides.

James Wellsted -- Head of Investor Relations

And then maybe a final one, I guess it's quite relevant, it's from Nkateko at Investec is, congrats on the great safety performance in gold. We haven't received feedback on the 2018 seismic safety incidents. What were the key takeaways?

Neal Froneman -- Chief Executive Officer

Yeah, so the DMRs run that process. That investigation is complete. They haven't come out with a final -- let's say outcome from the investigation. So it would be probably inappropriate for me to say much more than that, other than, I do not believe based on the feedback I've had from our lawyers, Wayne and Nicolas, that we were found wanting in any area. But let's respect the DMR process to come out with a finding.

All right, as James said, thank you for all those questions. It's been great to present these results. It's been great to relist the company yet today. I'd like to acknowledge the effort put in by my team, and as I said this morning, all 80,000 employees, but of course also the support we've had from investors, analysts and our bankers, and the rest of the market. Thank you very much and have a good day.

Duration: 124 minutes

Call participants:

Neal Froneman -- Chief Executive Officer

Charl Keyter -- Chief Financial Officer

Niel Pretorius -- Chief Executive Officer

Richard Stewart -- Executive Vice President: Business Development

Robert van Niekerk -- Executive Vice President and Head of South African PGM Operations

Shadwick Bessit -- Executive Vice President: SA Gold Operations

James Wellsted -- Head of Investor Relations

Patrick Mann -- Bank of America -- Analyst

Suvish -- Analyst

Arnold Van Graan -- Nedbank -- Analyst

Leroy Mnguni -- HSBC -- Analyst

Thobela -- Cachalia Capital -- Analyst

Martin Creamer -- Mining weekly Online -- Analyst

Rene Hochreiter -- Noah Capital -- Analyst

Dominic O'Kane -- JPMorgan -- Analyst

Adrian Hammond -- SBG Securities -- Analyst

Alex Ayoub -- Waha Capital -- Analyst

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