Sibanye Stillwater Limited Q4 FY2020 earnings call

• ESG initiatives: Committed to carbon neutrality by 2040, targeting 20% renewable penetration by 2030, and recognized for ESG credentials. - COVID-19 protocols: Successfully implemented protocols with South African mining industry COVID-19 death rate 1/3 of national rate, identified vulnerable employees and reduced risk. - Marikana renewal: Restored economic viability, provided ongoing counseling, houses, educational support, and pursued justice and restitution. - Value-based culture: Targeting 30% female workforce by 2025, implemented SoHo concept for remote working, and enhanced inclusivity through virtual connect sessions. - Safety performance: Lost 9 colleagues in 2020 due to safety-related issues, targeting international safety standards. - Reserve base growth: 40% increase in South African PGM mineral reserve base, 7% increase in U.S. PGM mineral reserve base, and South African gold ore reserves stable. - Market outlooks: Platinum fortunes set to turn, palladium in deficit, substitution of palladium with platinum and potential substitution of rhodium with palladium in autocatalysts.

The South African PGM business contributed 60% of adjusted EBITDA, with a 60% EBITDA margin in the second half of 2020. Production in the South African PGM business was 40% higher in H2 compared to H1, and all-in sustaining costs were brought down. The U.S. PGM business contributed 21% of adjusted EBITDA, with underground operations having 63% EBITDA margins and recycling EBITDA increasing from $38 million in 2019 to just over $50 million in 2020. The South African gold operations contributed 19% of adjusted EBITDA, with production increasing in the second half, and all-in sustaining costs reduced due to higher volumes.

• Declared a dividend at the top end of the dividend policy. - Targeting carbon neutrality by 2040. - Aiming for 20% renewable penetration by 2030. - Planning to provide a full update on decarbonization strategy in 2021. - Expecting to fund projects, maintain strong balance sheet, pay predictable dividends, and consider value-accretive M&A.

• Uncertain regulatory policy inhibiting investment. - Risks related to power reliability and rapidly escalating power costs. - Inflationary pressures, especially with imported equipment. - Operational risks in projects like Blitz due to geotechnical issues, ventilation constraints, and regulatory challenges.

Q: Whether Sibanye Stillwater is considering green hydrogen generation and the use of PGM hydrogen fuel sales to provide mobility on our sites, and progress on the 50-megawatt solar PV plant and 200-megawatt additional PV storage wind projects.

A: Neal Froneman said it's early stages for the hydrogen economy, with about 9 months to a year of work needed to outline the strategy. The 50-megawatt PV plant is in progress, and a 200-megawatt plant is being looked at in the Rustenburg area.

Q: Projected value of the hydrogen economy and when the impact on PGM demand is likely to reach a significant level, and roles PGM plays in the hydrogen economy and ensuring adequate PGM supply.

A: Neal Froneman said PGMs like platinum, Iridium, and rhodium play roles in the hydrogen economy, with feed demand forecasts impacted by the hydrogen economy in the second half of the decade.

Q: Views on the rhodium revenue contribution going forward and if it's sustainable.

A: Neal Froneman said substitution is important, with efforts to assist end users in finding alternatives, and fundamentals remain good for PGMs overall.

Q: Probability of paying a dividend significantly above the 35% of normalized earnings threshold in the near term considering organic growth investments and other projects.

A: Neal Froneman said the dividend is related to normalized earnings and will be sustainable and predictable, with potential to increase as earnings profile improves.

Q: What drove the free cash flow swing in the U.S. PGM operations between H1 and H2 2020 and expected working capital unwind in the first half of 2021.

A: Charl Keyter said the big swing was due to change in working capital, specifically with the recycling facility, and efforts to free up working capital through inventory financing are ongoing.

Q: What will be done with leftover cash, including dividend and M&A opportunities.

A: Neal Froneman said the dividend is not fixed, and excess cash may be used for value-accretive M&A or returned to shareholders if not needed for projects.

Q: How to think about K4 production and its impact on the overall SA PGM profile over the longer term, and expected working capital release in 2021.

A: Neal Froneman and Charl Keyter said K4 is a significant project with long-term production, and efforts are underway to release working capital from South African operations.