NORTHAM PLATINUM LIMITED - Northams long term credit rating upgraded

2017-10-13 10:40:00

NHM NHM002 NHM003 201710130014A
Northam’s long term credit rating upgraded

NORTHAM PLATINUM LIMITED
Incorporated in the Republic of South Africa
(Registration number 1977/003282/06)
Share code: NHM ISIN: ZAE000030912
Debt issuer code: NHMI
Bond code: NHM002 Bond ISIN: ZAG000129024
Bond code: NHM003 Bond ISIN: ZAG000129032
(“Northam” or the “group”)


NORTHAM’S LONG TERM CREDIT RATING UPGRADED


Northam wishes to advise shareholders that the credit rating agency, Global Credit Rating Co.
(“GCR”), has upgraded Northam’s long term credit rating to A-(ZA) from BBB+(ZA) and reaffirmed
Northam’s short term credit rating at A1-(ZA), with the outlook being accorded as Stable.

Northam’s credit rating upgrade was achieved despite the current and ongoing challenges being
faced by the mining industry, further illustrating the group’s resilience and ability to maintain a strong
capital base and liquidity position.

Northam’s credit rating upgrade is based on the following key considerations:

•    The realisation of projected benefits of Northam’s fully funded R6.6 billion black economic
     empowerment transaction through the acquisition of quality platinum group metal (“PGM”)
     assets at favourable prices.
•    Additional sources of production being expected from Northam’s recent transactions, including
     the acquisition of the Tumela block and the Eland Platinum mine, and further geographical and
     segmental diversification through the acquisition of the PGM recycling assets in the United
     States of America.
•    A 60% increase in Northam’s operating profit as a result of improved metal prices, lower costs
     of production, general economies of scale and the implementation of stringent cost controls.
•    The easing of Northam’s corporate risk profile as a result of Booysendal North maintaining
     steady state production for two years and becoming the second operational mine of the group.
•    A strong improvement in Northam’s operating cash flows, up from R952.7 million for the financial
     year ended 30 June 2016 to R1.1 billion for the financial year ended 30 June 2017.
•    A strong capital base, with R1.8 billion in cash as at 30 June 2017, well in excess of the
     R425 million in interest bearing obligations, as well as the availability of a R1.0 billion revolving
     credit facility (which increases to R1.5 billion H2 F2018), asserting Northam’s strong liquidity
     position in the medium-term.
•    A further positive rating migration is predicted on the development of Booysendal South and
     recently acquired ore bodies, which should see a continued widening of the group’s operating
     margins and sustainability of cash flows and credit protection metrics.

GCR has published an announcement in regard to Northam’s credit rating (available from GCR
at http://globalratings.net).

Johannesburg
13 October 2017

Corporate and Debt Advisor, Sponsor and Debt Sponsor
One Capital

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