Pan African forecasts a sharp earnings lift as gold sales accelerate
Pan African Resources expects FY26 EPS to rise as much as 151% and headline EPS to more than triple, driven by higher realised gold prices and sales. The company also projects further production growth in FY27, with formal results due next week.
- FY26 EPS forecast at US$17.24c-US$17.96c, up 141%-151%
- FY26 HEPS expected to rise 195%-205%
- Average gold price received increased 54.8% to US$4,235/oz
- Gold sold rose 38.3% to 272,373oz
- FY27 production forecast of 280,000oz-302,000oz
Pan African Resources PLC (ASX:PAF) expects its FY26 earnings per share to more than double, with headline earnings per share forecast to come close to tripling as the gold producer sold substantially more metal at a much higher realised price.
The company expects EPS for the year ended 30 June 2026 to land between US$17.24 cents and US$17.96 cents, compared with US$7.16 cents in FY25. That represents an increase of 141% to 151%. HEPS is forecast at US$17.35 cents to US$17.94 cents, up 195% to 205% from US$5.89 cents.
Higher gold prices and sales drive earnings
Pan African attributed the expected improvement primarily to revenue growth. The average gold price received rose 54.8% to US$4,235 an ounce from US$2,735 an ounce, while gold sold increased 38.3% to 272,373 ounces from 196,926 ounces.
The group expects to deliver its full-year all-in sustaining cost guidance of US$1,870 an ounce, based on an exchange rate of US$1 to ZAR17.00. That cost target provides an important reference point for assessing how much of the stronger gold-price environment translated into operating performance, although the trading statement does not provide the final full-year margin or cash-flow figures.
Share-based payment expense remains a drag
The headline earnings improvement comes despite an expected increase of about US$40 million in the share-based payment liability, recorded among other exceptional expenses. The liability rose as Pan African’s share price appreciated during the reporting period, meaning the accounting charge is linked to the company’s own equity value rather than a deterioration in mine operating costs.
Currency movements also need to be kept in view when the final numbers arrive. Pan African reports in US dollars but operates with South African rand and Australian dollar functional currencies. The average US$/ZAR rate moved to 16.90 from 18.17, while the average US$/A$ rate moved to 1.47 from 1.54, affecting the translation of the group’s underlying financial performance. The weighted average share count also increased to 2.030 billion from 1.979 billion.
Tennant Mines supports FY27 production growth
Pan African expects group production to rise further in the year ending 30 June 2027, targeting between 280,000 ounces and 302,000 ounces. The company said the increase will be largely attributable to higher production from Tennant Mines.
The figures remain a trading statement rather than audited results. Pan African’s formal FY26 results are scheduled for 16 September, when investors will have the complete earnings, cost and cash-flow picture, along with a clearer test of whether the current production range can be converted into sustained output.
Bottom Line?
The immediate catalyst is the 16 September results release, which should show how much of the gold-price windfall became durable operating earnings after costs, currency effects and the US$40 million share-based payment charge.
Questions in the middle?
- Will the final FY26 results confirm the upper or lower end of the EPS and HEPS ranges?
- Can Tennant Mines deliver the production increase embedded in the FY27 guidance?
- How sensitive will reported earnings and cash generation be to gold prices and exchange rates after FY26?
