Sibanye-Stillwater, a global precious metal mining firm founded by South African magnate Neal Froneman, had a difficult fiscal year in 2023, posting a net loss of $2 billion, a dramatic contrast to the $1.1 billion profit achieved the previous year.
The company’s slump is mostly due to a $2.52 billion impairment charge from its palladium mine in the United States, as well as a steep decrease in platinum, palladium, and rhodium prices.
The dismal financial performance follows Sibanye’s aggressive purchase strategy, which included battery metal properties in France, Finland, Australia, and the United States. To offset the impact and safeguard the long-term viability of its South African platinum group metals (PGM) operations, the business has announced cost-saving initiatives.
During a results call, Sibanye-Stillwater CEO Neal Froneman addressed the company’s approach, saying, “We are going to raise additional capital, but the perception that it will be a rights issue is completely incorrect.” Froneman acknowledged the need for additional reorganization, particularly at Sibanye’s US PGM operations and the Sandouville nickel refinery in France.
The financial instability at Sibanye in 2023 has taken a toll on shareholders, including Froneman, who owns a 0.3 percent interest in the corporation. Froneman, a key figure in the company’s transformation into a top producer of precious metals, has seen the market value of his shares plummet dramatically.
Sibanye’s Johannesburg Stock Exchange shares have fallen by more than 26% this year alone, reducing the company’s market capitalization to R51.5 billion ($2.72 billion). Froneman’s stake, currently at R152.74 million ($8.06 million), highlights the broader issues facing the precious metals business as prices fall.
Sibanye is not alone in seeing a drop in platinum group metals (PGM) prices as a result of global economic uncertainty and a trend toward electric vehicles. South African mining businesses are dealing with the need for reorganization and job losses in order to manage the difficult market conditions.
