Sibanye Stillwater : Annual Financial Report 2019

Ni

Cu

Pd

Ru

O U R M I N I N G I M P R OV E S L I V E S

Rh	Ir

Au

Pt	ANNUAL
	FINANCIAL
	REPORT

Cr	2019

FOWARD-LOOKING STATEMENTS

The information in this report may contain forward-looking statements within the meaning of the "safe harbour" provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements, including, among others, those relating to Sibanye Stillwater Limited's ("Sibanye-Stillwater" or the "Group") financial positions, business strategies, plans and objectives of management for future operations, are necessarily estimates reflecting the best judgment of the senior management and directors of Sibanye-Stillwater. All statements other than statements of historical facts included in this report may be forward-looking statements. Forward-looking statements also often use words such as "will", "forecast", "potential", "estimate", "expect" and words of similar meaning. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances and should be considered in light of various important factors, including those set forth in this disclaimer. Readers are cautioned not to place undue reliance on

such statements.

The important factors that could cause Sibanye-Stillwater's actual results, performance or achievements to differ materially from those in the forward-looking statements include, among others, our future business prospects; financial positions; debt position and our ability to reduce debt leverage; business, political and social conditions in the United States, South Africa, Zimbabwe and elsewhere; plans and objectives of management for future operations; our ability to obtain the benefits of any streaming arrangements or pipeline financing; our ability

to service our bond instruments; changes in assumptions underlying Sibanye-Stillwater's estimation of their current mineral reserves and resources; the ability to achieve anticipated efficiencies and other cost savings in connection with past, ongoing and future acquisitions, as well as at existing operations; our ability to achieve steady state production at the Blitz project; the success of Sibanye-Stillwater's business strategy; exploration and development activities; the ability of Sibanye-Stillwater to comply with requirements that they operate in a sustainable manner; changes in the market price of gold, PGMs and/or uranium; the occurrence of hazards associated with underground and surface gold, PGMs and uranium mining; the occurrence of labour disruptions and industrial action; the availability, terms and deployment of capital or credit; changes in relevant government regulations, particularly environmental, tax, health and safety regulations and new legislation affecting water, mining, mineral rights and business ownership, including any interpretations thereof which may be subject to dispute; the outcome and consequence of any potential or pending litigation or regulatory proceedings or other environmental, health

and safety issues; power disruptions, constraints and cost increases; supply chain shortages and increases in the price of production inputs; fluctuations in exchange rates, currency devaluations, inflation and other macro-economic monetary policies; the occurrence of temporary stoppages of mines for safety incidents and unplanned maintenance; the ability to hire and retain senior management or sufficient technically skilled employees, as well as their ability to achieve sufficient representation of historically disadvantaged South Africans in management positions; failure of information technology and communications systems; the adequacy of insurance coverage; any social unrest, sickness or natural or man-made disaster at informal settlements in the vicinity of some of Sibanye-Stillwater's operations; and the impact of HIV, tuberculosis and the spread of other contagious diseases, such as coronavirus ("COVID-19"). Further details of potential risks and uncertainties affecting Sibanye-Stillwater are described in Sibanye-Stillwater's filings with the Johannesburg Stock Exchange and the United States Securities and Exchange Commission, including the Integrated Annual Report 2019 and the Annual Report on Form 20-F for the fiscal year ended 31 December 2019.

These forward-looking statements speak only as of the date of the content. Sibanye-Stillwater expressly disclaims any obligation or undertaking to update or revise any forward-looking statement (except to the extent legally required).

OUR 2019 REPORTS

These reports cover the financial year from 1 January 2019 to 31 December 2019.

Ni
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Pd		O U R M I N I N G I M P R OV E S L I V E S
Ru
Rh	Ir		INTEGRATED 2019REPORT
Au	Pt	2019
	INTEGRATED
		REPORT
	Cr

Ni
Cu		2019	RESOURCESMINERAL RESERVESMINERALAND 2019REPORT
Pd
	O U R M I N I N G I M P R OV E S L I V E S
Ru
Rh	Ir
	Pt	MINERAL
	RESOURCES
Au		AND MINERAL
		RESERVES
		REPORT
	Cr

Ni
Cu			REPORTSUMMARISED NOTICEANDANNUALOF MEETINGGENERAL2019
Pd		O U R M I N I N G I M P R OV E S L I V E S
Ru		2019
Rh	Ir
	Pt	SUMMARISED
	REPORT AND
	NOTICE OF
Au		ANNUAL
	GENERAL
		MEETING
	Cr

Ni
Cu
Pd		O U R M I N I N G I M P R OV E S L I V E S	FINANCIALANNUAL 2019REPORT
Ru		2019
Rh	Ir
Au	Pt	ANNUAL
	FINANCIAL
		REPORT
	Cr

Sibanye Stillwater Limited (Sibanye-Stillwater), a leading international precious metals producer, mining and processing platinum group metals (PGMs) and gold. We have a geographically diverse portfolio of operations and projects in the United States (US) and southern Africa (SA). The Group is domiciled and headquartered in South Africa.

ABOUT OUR REPORTS

The 2019 suite of reports describe Sibanye-Stillwater's progress in delivering on our strategy and related strategic focus areas, and on our purpose and vision to create value, responsibly and sustainably, over the short, medium and long term. The Integrated Report is the primary report in the suite and includes coverage of our performance on environmental, social and governance aspects.

In compiling our suite of reports, we considered and/or complied with the following frameworks, standards, and guidelines, among others:

International Integrated Reporting		Global Reporting Initiative (GRI)		King Report on Corporate Governance
Framework		Standards		for SA, 2016 (King IV)
International Council on Mining		Johannesburg Stock Exchange (JSE)		Companies Act South Africa, 71
and Metals (ICMM)		Listings Requirements		of 2008, as amended
International Financial Reporting		South African Institute of		South African Code for the
Standards (IFRS)		Chartered Accountants Financial		Reporting of Exploration Results,
		Reporting Guides		Mineral Resources and Mineral
				Reserves (SAMREC Code, 2016
				edition)

SUPPORTING FACT SHEETS AND DOCUMENTS AVAILABLE ONLINE INCLUDE:

• Care for iMali: Taking care of personal finance
• Biomonitoring of rivers and biodiversity
• Working together: Good Neighbor Agreement (GNA)
• Generating clean energy: Beatrix methane capture and destruction project
• Combatting illegal mining
• Social and labour plans: Summary of projects in South Africa
• Environmental incidents in 2019: Level 3 and higher
• GRI Content Index 2019
• King IV Disclosure 2019
• Definitions of sustainability/ESG indicators

Ni
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Pd		O U R M I N I N G I M P R OV E S L I V E S
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Au	Pt	COMPANY
	FINANCIAL
		STATEMENTS
	Cr	2019

COMPANY FINANCIAL STATEMENTS 2019

Online

All of our 2019 reports, together with supporting information, are available on our website at: www.sibanyestillwater.com

We welcome your feedback

Your feedback, comments and suggestions help ensure that we cover the issues that matter to you. Please direct your suggestions and comments to:

James Wellsted, Head of Investor Relations at:

[e-mail]

www.sibanyestillwater.com

2

ANNUAL FINANCIAL REPORT

CONTENTS

OVERVIEW

4 Five-year financial performance

8 Management's discussion and analysis of the financial statements

ACCOUNTABILITY

1. Statement of responsibility by the Board of Directors

1. Company secretary's confirmation
2. Report of the Audit Committee

34 Directors' report

40 Report of independent registered public accounting firm

CONSOLIDATED FINANCIAL STATEMENTS

46 Consolidated income statement

1. Consolidated statement of other comprehensive income
2. Consolidated statement of financial position
3. Consolidated statement of changes in equity
4. Consolidated statement of cash flows
5. Notes to the consolidated financial statements

The audited consolidated financial statements for the year ended

31 December 2019 have been prepared by Sibanye-Stillwater's group financial reporting team headed by Jacques Le Roux. This process was supervised by the Group's CFO, Charl Keyter and authorised for issue by Sibanye-Stillwater's Board of Directors on 22 April 2020.

ANCILLARY INFORMATION

123 Shareholder information

126 Administration and corporate information

On 24 February 2020, Sibanye Stillwater Limited and Sibanye Gold Limited implemented a scheme of arrangement in terms of section 114 of the South African Companies Act, 2008, which resulted in, amongst other things, Sibanye Gold Limited's operations being reorganised under Sibanye Stillwater Limited, which became the parent company of the group (the Reorganisation). See "Consolidated financial statements-Notes to the consolidated financial statements-Note 38.1 Sibanye Gold Limited scheme of arrangement". The historical financial statements included in this report are those of Sibanye Gold Limited. Accordingly, in this annual financial report, references to "Sibanye-Stillwater" shall include Sibanye Gold Limited and its subsidiaries prior to the implementation of the Reorganisation and, Sibanye Stillwater Limited and its subsidiaries, subsequent to the implementation of the Reorganisation, as the context requires.

Sibanye-Stillwater Annual Financial Report 2019

3

FIVE-YEAR FINANCIAL PERFORMANCE

		2019	2018	2017	2016	2015
Group operating statistics
US PGM operations1
Production		1,411
Ore milled	'000t	1,339	855	-	-
Platinum produced	'000 2Eoz	133	134	85	-	-
Palladium produced	'000 2Eoz	460	459	291	-	-
PGM produced	'000 2Eoz	594	593	376	-	-
PGM sold	'000 2Eoz	578	594	355	-	-
PGM recycled	'000 2Eoz	853	687	517	-	-
Price and costs		20,287
Average basket price	R/2Eoz	13,337	12,330	-	-
	US$/2Eoz	1,403	1,007	927	-	-
Operating cost2	R/t	4,200	3,353	3,081	-	-
	US$/t	290	253	232	-	-
	R/2Eoz	9,978	7,576	7,001	-	-
	US$/2Eoz	690	572	526	-	-
Adjusted EBITDA3	Rm	7,291	4,152	2,143	-	-
Adjusted EBITDA margin4		27	26	23	-	-
All-in sustaining cost5	R/2Eoz	11,337	8,994	8,707	-	-
	US$/2Eoz	784	677	651	-	-
All-in sustaining cost margin6	%	45	37	29	-	-
All-in cost5	R/2Eoz	14,763	11,651	11,097	-	-
	US$/2Eoz	1,021	880	821	-	-
All-in cost margin6	%	29	18	10	-	-
Capital expenditure		3,393
Total capital expenditure	Rm	2,833	1,654	-	-
SA PGM operations
Production		31,624
Ore milled	'000t	25,841	26,196	11,612	-
Platinum produced	'000 4Eoz	948	685	695	239	-
Palladium produced	'000 4Eoz	489	364	372	136	-
PGM produced	'000 4Eoz	1,608	1,176	1,194	421	-
PGM sold	'000 4Eoz	1,306	1,176	1,194	421	-
Price and costs7		19,994
Average basket price	R/4Eoz	13,838	12,534	12,209	-
	US$/4Eoz	1,383	1,045	942	832	-
Operating cost2	R/t	724	474	467	373	-
	US$/t	50	36	35	25	-
	R/4Eoz	14,699	11,019	10,831	7,993	-
	US$/4Eoz	1,017	832	814	545	-
Adjusted EBITDA3	Rm	8,796	2,882	1,594	350	-
Adjusted EBITDA margin4		32	19	12	9	-
All-in sustaining cost5	R/4Eoz	14,857	10,417	10,399	10,404	-
	US$/4Eoz	1,027	787	782	709	-
All-in sustaining cost margin6	%	20	28	16	8	-
All-in cost5	R/4Eoz	14,875	10,472	10,401	10,404	-
	US$/4Eoz	1,027	791	782	709	-
All-in cost margin6	%	20	27	16	8	-
Capital expenditure		2,248
Total capital expenditure	Rm	1,000	1,035	327	-

Sibanye-Stillwater Annual Financial Report 2019

4

FIVE-YEAR FINANCIAL PERFORMANCE continued

		2019	2018	2017	2016	2015
SA gold operations
Production		41,498
Ore milled	'000t	27,199	19,030	20,181	19,861
Gold produced	kg	29,009	36,600	43,634	47,034	47,775
	'000oz	933	1,177	1,403	1,512	1,536
Gold sold	kg	28,743	36,489	43,763	46,905	47,775
	'000oz	924	1,173	1,407	1,508	1,536
Price and costs		648,662
Gold price	R/kg	535,929	536,378	586,319	475,508
	US$/oz	1,395	1,259	1,254	1,242	1,160
Operating cost2	R/t	446	648	937	862	825
	US$/t	31	49	70	59	65
	R/kg	637,681	490,209	408,773	369,707	342,857
	US$/oz	1,372	1,151	956	784	836
Adjusted EBITDA3	Rm	(969)	1,362	5,309	9,920	6,235
Adjusted EBITDA margin4	%	(5)	7	23	36	27
All-in sustaining cost5	R/kg	717,966	557,530	482,693	450,152	422,472
	US$/oz	1,544	1,309	1,128	954	1,031
All-in sustaining cost margin6	%	(11)	(4)	10	23	11
All-in cost5	R/kg	735,842	583,409	501,620	472,585	430,746
	US$/oz	1,583	1,370	1,173	1,002	1,051
All-in cost margin6	%	(13)	(9)	6	19	9
Capital expenditure		2,066
Total capital expenditure	Rm	3,248	3,410	3,824	3,345

1. The US PGM operations' underground production is converted to metric tonnes and kilograms, and performance is translated into SA rand. In addition to the US PGM operations' underground production, the operation processes recycling material which is excluded from the 2E PGM production, average basket price, operating cost, All-in sustaining cost and All-in cost statistics shown. PGM recycling represents palladium, platinum, and rhodium ounces fed to the furnace
2. Operating cost is the average cost of production, and operating cost per tonne is calculated by dividing the cost of sales, before amortisation and depreciation and change in inventory in a period by the tonnes milled in the same period, and operating cost per kilogram and ounce is calculated by dividing the cost of sales, before amortisation and depreciation and change in inventory in a period by the gold or platinum group metals (PGM) produced in the same period
3. The Group reports adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) based on the formula included in the facility agreements for compliance with the debt covenant formula. Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Adjusted EBITDA is not a measure of performance under IFRS and should be considered in addition to, and not as a substitute for, other measures of financial performance and liquidity. For a reconciliation of (loss)/profit before royalties and tax to adjusted EBITDA, see -Consolidated financial statements-Notes to the consolidated financial statements- Note 26.9: Capital management
4. Adjusted EBITDA margin is calculated by dividing adjusted EBITDA by revenue
5. Sibanye-Stillwaterpresents the financial measures "All-in sustaining costs", "All-in costs", "All-in sustaining cost per kilogram", "All-in sustaining cost per ounce", "All- in cost per kilogram" and "All-in cost per ounce", which were introduced during the year ended 31 December 2013 by the World Gold Council (the Council). Despite not being a member of the Council at the time, Sibanye-Stillwater adopted the principles prescribed by the Council. The Council is a non-profit association of the world's leading gold mining companies established in 1987 to promote the use of gold from industry, consumers and investors and is not a regulatory organisation. The Council has worked with its member companies to develop a metric that expands on International Financial Reporting Standards (IFRS) measures such as cost of goods sold and currently accepted non-IFRS measures to provide relevant information to investors, governments, local communities and other stakeholders in understanding the economics of gold mining operations related to expenditures, operating performance and the ability to generate cash flow from operations. This is especially true with reference to capital expenditure associated with developing and maintaining gold mines, which has increased significantly in recent years and is reflected in this metric
   All-in sustaining costs, All-in costs, All-in sustaining cost per kilogram, All-in sustaining cost per ounce, All-in cost per kilogram and All-in cost per ounce metrics are intended to provide additional information only, do not have any standardised meaning prescribed by IFRS and should not be considered in isolation or as alternatives to cost of sales, profit before tax, profit for the year, cash from operating activities or any other measure of financial performance presented in accordance with IFRS. All-in sustaining costs, All-in costs, All-in sustaining cost per kilogram, All-in sustaining cost per ounce, All-in cost per kilogram and All-in cost per ounce as presented in this document may not be comparable to other similarly titled measures of performance of other companies. Other companies may calculate these measures differently as a result of differences in the underlying accounting principles, policies applied and accounting frameworks such as in US GAAP. Differences may also arise related to definitional differences of sustaining versus development capital activities based upon each company's internal policies
   All-in costs excludes income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed to normalise earnings
   All-in costs is made up of All-in sustaining costs, being the cost to sustain current operations, given as a sub-total in the All-in costs calculation, together with corporate and major capital expenditure growth
   For a reconciliation of cost of sales, before amortisation and depreciation to All-in costs, see -Overview-Management's discussion and analysis of the financial statements-2019 financial performance compared with 2018-Cost of sales-All-in costs
6. All-insustaining cost margin is defined as revenue minus All-in sustaining costs divided by revenue. All-in cost margin is defined as revenue minus All-in costs divided by revenue
7. The total SA PGM operations unit cost benchmarks (including capital expenditure) exclude the financial results of Mimosa, which is equity accounted, and excluded from revenue and cost of sales

Sibanye-Stillwater Annual Financial Report 2019

5

FIVE-YEAR FINANCIAL PERFORMANCE continued

		2019	2018	2017	2016	2015
Group financial statistics1
Income statement		72,925
Revenue	Rm	50,656	45,912	31,241	22,717
Cost of sales, before amortisation and depreciation	Rm	56,100	41,515	36,483	20,709	16,380
Amortisation and depreciation	Rm	(7,214)	(6,614)	(5,700)	(4,042)	(3,637)
Profit/(loss) for the year	Rm	433	(2,521)	(4,433)	3042.7	538
Profit/(loss) for the year attributable to owners of	Rm	62	(2,500)	(4,437)	3,473	717
Sibanye-Stillwater
	2
Basic earnings per share	cents	(110)	(229)	225	47
Diluted earnings per share	cents	2	(110)	(229)	225	47
Headline earnings per share	cents	(40)	(1)	(12)	162	44
Dividend per share	cents	-	-	60	175	72
Weighted average number of shares	'000	2,507,583	2,263,857	1,933,850	1,544,650	1,534,955
Diluted weighted average number of shares	'000	2,578,955	2,263,857	1,933,850	1,546,811	1,540,626
Number of shares in issue at end of period	'000	2,670,029	2,266,261	2,168,721	929,004	916,140
Statement of financial position
Property, plant and equipment	Rm	57,480	54,558	51,445	27,240	22,132
Cash and cash equivalents	Rm	5,619	2,549	2,062	968	717
Total assets	Rm	101,072	84,923	76,072	41,721	28,266
Net assets	Rm	31,138	24,724	23,998	16,469	14,985
Stated share capital	Rm	40,662	34,667	34,667	21,735	21,735
Borrowings2	Rm	23,736	24,505	25,650	8,974	3,804
Total liabilities	Rm	69,934	60,199	52,074	25,252	13,281
Statement of cash flows
Net cash from operating activities	Rm	9,464	12,197	2,741	4,406	3,515
Net cash used in investing activities	Rm	(4,865)	(7,744)	(28,144)	(9,444)	(3,340)
Net cash (used in)/from financing activities	Rm	(1,470)	(4,101)	26,807	5,446	(21)
Net increase in cash and cash equivalents	Rm	3,129	352	1,403	408	155
Other financial data		14,956
Adjusted EBITDA3	Rm	8,369	9,045	10,270	6,235
Net debt4	Rm	20,964	21,269	23,176	6,293	1,362
Net debt to adjusted EBITDA5	ratio	1.40	2.54	2.56	0.60	0.21
Net asset value per share6	R	11.66	10.91	11.07	17.73	16.36
Average exchange rate7	R/US$	14.46	13.24	13.31	14.68	12.75
Closing exchange rate8	R/US$	14.00	14.35	12.36	13.69	15.54
Share data		35.89
Ordinary share price - high	R	17.16	33.26	70.23	32.26
Ordinary share price - low	R	16.76	6.82	14.15	21.98	13.66
Ordinary share price at year end	R	35.89	10.02	15.78	25.39	22.85
Average daily volume of shares traded	'000	21,383	10,567	9,080	6,165	3,024
Market capitalisation at year end	Rbn	95.8	22.7	34.2	23.6	20.9

1. The selected historical consolidated financial data set out above have been derived from Sibanye-Stillwater's consolidated financial statements for those periods and as at those dates which have been prepared in accordance with IFRS. Headline earnings per share is calculated in terms of the guidance issued by the South African Institute of Chartered Accountants (SAICA), see -Consolidated financial statements-Notes to the consolidated financial statements-Note 10.3: Headline earnings per share
2. This represents total borrowings as per the consolidated financial statements, see-Consolidated financial statements-Notes to the consolidated financial statements- Note 26: Borrowings
3. The adjusted EBITDA is based on the formula included in the facility agreements for compliance with the debt covenant formula. Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Adjusted EBITDA is not a measure of performance under IFRS and should be considered in addition to, and not as a substitute for, other measures of financial performance and liquidity. For a reconciliation of (loss)/profit before royalties and tax to adjusted EBITDA, see -Consolidated financial statements-Notes to the consolidated financial statements-Note 26.9: Capital Management
4. Net debt represents borrowings and bank overdraft less cash and cash equivalents. Borrowings are only those borrowings that have recourse to Sibanye-Stillwater, and, therefore, exclude the Burnstone Debt and include the deriative financial instrument. Net debt excludes cash of Bursntone.
5. Net debt to adjusted EBITDA (ratio) is defined as net debt as at the end of a reporting period divided by adjusted EBITDA of the last 12 months ending on the same reporting date
6. Net asset value per share (ratio) is defined as total assets as at the end of a reporting period minus total liabilities as at the end of a reporting period divided by the total number of shares in issue on the same reporting date
7. The average exchange rate during the relevant period as reported by IRESS. The average exchange rate for the period through 15 April 2020 was R15.81/US. The following table sets forth the high and low exchange rates for each month during the previous six months

Month ended	High	Low
31	October 2019	15.40	14.51
30	November 2019	15.17	14.59
31	December 2019	14.87	13.96
31	January 2020	15.03	13.93
29	February 2020	15.83	14.67
31	March 2020	15.21	18.07
Through 15 April 2020	19.35	13.93

Sibanye-Stillwater Annual Financial Report 2019

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FIVE-YEAR FINANCIAL PERFORMANCE continued

8 The closing exchange rate at period end. The closing exchange on 15 April 2020, as reported by IRESS, was R18.69/US$. Fluctuations in the exchange rate between the rand and the US dollar will affect the US dollar equivalent of the price of the ordinary shares on the JSE, which may affect the market price of the American Depositary Receipts (ADRs) on the NYSE. These fluctuations will also affect the US dollar amounts received by owners of ADRs on the conversion of any dividends paid in rand on the ordinary shares

Sibanye-Stillwater Annual Financial Report 2019

7

MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS

The following discussion and analysis should be read together with Sibanye-Stillwater's consolidated financial statements including the notes, which appear elsewhere in this annual financial report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties. See Forward-looking statements for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in this annual financial report. The comparison of the Group's 2018 financial performance to the Group's 2017 financial performance can be found on pages 167 to 189 of Sibanye Gold Limited's Annual Report on Form 20-F for the year ended 31 December 2018 filed with United States Securities and Exchange Commission on 8 April 2019.

Introduction

Sibanye-Stillwater is an independent, global, precious metals mining company producing a mix of metals that includes PGMs and gold. Domiciled and with its head office in South Africa, Sibanye-Stillwater owns and operates a portfolio of high-quality operations and projects that are located as follows:

US PGM operations

The East Boulder and the Stillwater (including Blitz) mines are located in Montana, in the United States. The Columbus Metallurgical Complex, which smelts the material mined to produce PGM-rich filter cake, also conducts PGM recycling activities.

SA PGM operations

The Kroondal, Rustenburg, Marikana and Platinum Mile operations are located on the western limb of the Bushveld Complex in South Africa, while Mimosa is on the southern portion of the Great Dyke in Zimbabwe. Platinum Mile is a retreatment facility. Mimosa is a 50:50 joint venture with Impala Platinum Holdings Limited.

SA gold operations

The Driefontein, Kloof and Cooke surface operations are located on the West Rand of the Witwatersrand Basin, while Beatrix is in the southern Free State goldfields of the Basin. Sibanye- Stillwater also has an interest in surface tailings retreatment facilities located from the East Rand to the West Rand through our 38.05% stake in DRDGOLD Limited (DRDGOLD) and is currently a de jure shareholder post the exercise of the option to increase its shareholding to 50.10%, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-

Note 38.2: DRDGOLD increase in shareholding.

Projects

Our projects are:

• Marathon, a PGM project in Ontario, Canada
• Altar and Rio Grande, copper- gold projects in the Andes in north-west Argentina, close to the Chilean border
• Denison project, a PGM project in Ontario, which was previously held in a subsidiary company of Lonmin
• Hoedspruit, Zondernaam and Vygenhoek, PGM projects in South Africa
• Burnstone and the southern Free State gold projects in South Africa

At our PGM operations in South Africa and Zimbabwe, the primary PGMs produced are platinum, palladium and rhodium, which together with gold, are referred to as 4E (3PGM+Au). Production by ratio is approximately 59% (2018:58%) platinum (Pt), 30% (2018:32%) palladium (Pd), 9% (2018:8%) rhodium (Rh) and 2% (2018:2%) gold (Au). During 2019 Sibanye-Stillwater changed to a toll arrangement to smelt and refine concentrate from its Rustenburg operations but retains ownership of the refined 4E metal produced. At its Marikana operations all concentrate is refined by its precious metal refinery, Kroondal and Platinum mile operations remain on a purchase of concentrate agreement.

The US PGM operations primarily produce palladium and platinum (78% palladium and 22% platinum), referred to as 2E (or 2PGM). The PGM- bearing ore mined is processed and smelted to produce a PGM-rich filter cake. A third party refines the filter cake to produce refined PGMs.

The major sources of demand for PGMs are for use in autocatalysts and jewellery. Combined, these two areas accounted for around 56% (2018: 69%) of gross platinum demand in 2019. Autocatalysts alone accounted for 32% (2018: 40%) of gross platinum demand and for 88% (2018: 85%) of gross palladium demand in 2019.

Sibanye-Stillwater mines, extracts and processes gold-bearing ore at its SA gold operations to produce a beneficiated product, doré, which is then refined at Rand Refinery Proprietary Limited (Rand Refinery) into gold bars with a purity of at least 99.5% in accordance with the London Bullion Market Association's standards of Good Delivery. Sibanye-Stillwater holds a 44% interest in Rand Refinery, one of the largest refiners of gold globally, and the largest in Africa. Sibanye-Stillwater sells the refined gold to its customers who are international banks based in South Africa and a residual amount, below 5%, is sold to Rand Refinery.

The main sources of demand for gold are as a store of value (such as central bank holdings), as an investment (exchange traded funds, bars and coins), jewellery and for various industrial purposes.

In 2019, Sibanye-Stillwater delivered attributable PGM production of 0.59Moz (2E) (2018: 0.59Moz (2E)) and 1.61Moz (4E) (2018: 1.18Moz (4E)),

and produced 29,009kg (0.93Moz) (2018: 36,600kg (1.18Moz)) of gold, from its US PGM, SA PGM and SA gold operations respectively.

During the year, Sibanye-Stillwater recognised a profit of R433 million (2018: loss of R2,521 million), of which R62 million profit (2018: R2,500 million loss) is attributable to the owners of Sibanye-Stillwater.

At 31 December 2019, Sibanye-Stillwater had 2E PGM mineral reserves of 26.9Moz (2018: 25.6Moz), 4E PGM mineral reserves of 28.2Moz

(2018: 20.4Moz), and gold mineral reserves of 15.4Moz (2018: 16.6Moz).

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

The following financial review provides stakeholders with greater insight into the financial performance and position of the Group during the periods indicated.

Factors affecting Sibanye-Stillwater's performance

Commodity prices

Sibanye-Stillwater's revenues are primarily derived from the sale of the PGMs and gold that it produces, from its own mines and its recycling facilities. For mined production, Sibanye-Stillwater does not generally enter into forward sales, commodity derivatives or other hedging arrangements in order to establish a price in advance of the sale of its production, unless these derivatives are used for risk mitigation and project funding initiatives. As a result, Sibanye-Stillwater is normally fully exposed to changes in commodity prices for its mined production. Metals from recycled material, which is solely produced at the Columbus metallurgical facilities in Montana, are sold forward at the time the material is purchased and they are delivered against the forward sales contracts when the ounces are recovered. This negates commodity price volatility and exposure during the outturn period of approximately sixty to ninety days.

As detailed previously, PGM and gold hedging is considered under one or more of the following circumstances: to protect cash flows at times of significant capital expenditures; financing projects; or to safeguard the viability of higher cost operations, see -Consolidatedfinancial statements-

Notes to the consolidated financial statements-Note 34.2: Risk management activities.

Historically, platinum, palladium and rhodium prices have been subject to wide fluctuations and are affected by numerous factors beyond Sibanye-Stillwater's control, including international macroeconomic conditions and outlook, levels of supply and/or demand, any actual or potential threats to the stability of supply and/or demand, inventory levels maintained by users and producers, liquidity of above ground excess inventories, actions of participants in the commodities markets and currency exchange rates, particularly the rand to the US dollar.

In addition, platinum, palladium and rhodium exchange-traded funds (ETFs) have added a further element of unpredictability and volatility to the pricing environment and may increase volatility in PGM prices, particularly during structurally tight markets. ETF investors may exhibit procyclical behavior, purchasing shares in ETFs during times of rising prices and selling holdings during periods of declining prices. This behavior may exacerbate short term price volatility. The market prices of platinum, palladium, rhodium and other PGMs have been, and may in the future be, subject to rapid short-term changes.

The volatility of the price of platinum is illustrated in the platinum price table below (which shows the annual high, low and average of the London market price of platinum). Over the period from 2017 to 2019, the platinum price has fluctuated between a high price of US$1,046/oz and a low price US$770/oz.

			US$/oz1,2
Platinum	High		Low	Average
2016	1,178	821	990
2017	1,046	884	950
2018	1,025	770	879
2019	985	777	864
2020 (through 31 March 2020)	1,030	605	906

1. Rounded to the nearest US dollar
2. Metal price sourced from IRESS

The London market price of platinum was US$971/oz at 31 December 2019 and was US$772/oz on 15 April 2020.

The volatility of the price of palladium is illustrated in the palladium price table below (which shows the annual high, low and average of the London market price of palladium). Over the period from 2017 to 2019, the palladium price has fluctuated between a high price of US$1,993/oz and a low price US$706/oz.

			US$/oz1,2
Palladium	High		Low		Average
2016	770	470	624
2017	1,067	706	886
2018	1,265	857	1,038
2019	1,993	1,260	1,570
2020 (through 31 March 2020)	2,814	1,589	2,452

1. Rounded to the nearest US dollar
2. Metal price sourced from IRESS

The London market price of palladium was US$1,917/oz at 31 December 2019 and was US$2,233/oz on 15 April 2020.

The volatility of the price of rhodium is illustrated in the rhodium price table below (which shows the annual high, low and average of the London market price of rhodium). Over the period from 2017 to 2019, the rhodium price has fluctuated between a high price of US$6,150/oz and a low price US$770/oz.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

			US$/oz1,2
Rhodium
High		Low	Average
2016	825	625	696
2017	1,715	770	1,155
2018	2,600	1,690	2,255
2019	6,150	2,460	4,040
2020 (through 31 March 2020)	13,800	5,500	11,205

1. Rounded to the nearest US dollar
2. Metal price sourced from IRESS

The London market price of rhodium was US$6,060 at 31 December 2019 and was US$7,200/oz on 15 April 2020.

The market price of gold has historically been volatile and is affected by numerous factors over which Sibanye-Stillwater has no control, such as general supply and demand, speculative trading activity and global economic drivers. Further, over the period from 2017 to 2019, the gold price has fluctuated between a high price of US$1,546/oz and a low price US$1,149/oz.

The volatility of the price of gold is illustrated in the gold price table below (which shows the annual high, low and average of the London afternoon fixing price of gold).

Gold			US$/oz1,2
High		Low		Average
2016	1,366	1,077	1,250
2017	1,351	1,149	1,257
2018	1,360	1,177	1,269
2019	1,546	1,270	1,393
2020 (through 31 March 2020)	1,687	1,472	1,583

1. Rounded to the nearest US dollar
2. Metal price sourced from IRESS

The London afternoon fixing price of gold was US$1,523/oz at 31 December 2019 and was US$1,719/oz on 15 April 2020.

Exchange rate

Sibanye-Stillwater's SA PGM and gold operations (with the exception of Mimosa) are all located in South Africa, and its revenues are equally sensitive to changes in the US dollar PGM (4E) basket and gold prices, and the rand/US dollar exchange rate (the exchange rate). Depreciation of the rand against the US dollar results in Sibanye-Stillwater's revenues and operating margins increasing. Conversely, should the rand appreciate against the US dollar, revenues and operating margins would decrease. The impact on profitability of any change in the exchange rate can be substantial. Furthermore, the exchange rates obtained when converting US dollars to rand are set by foreign exchange markets, over which Sibanye-Stillwater has no control. The relationship between currencies and commodities, which includes the PGM (4E) basket and gold prices, is complex, and changes in exchange rates can influence commodity prices, and vice versa.

As a general rule, Sibanye-Stillwater does not enter into long-term currency hedging arrangements and is mainly exposed to the spot market exchange rate. Sibanye-Stillwater's SA PGM and gold operations' costs are primarily denominated in rand (with the exception of Mimosa), and forward cover could be considered for significant expenditures based in foreign currency or those items which have long lead times to production or delivery, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note34.2: Risk management activities.

Costs

Sibanye-Stillwater's cost of sales, before amortisation and depreciation comprise mainly labour and contractor costs, power and water, and consumable stores which include, inter alia, explosives, timber, cyanide, steel balls, flotation collector, and other consumables. Sibanye-Stillwater expects that its cost of sales, particularly the input costs noted above, are likely to continue to increase in the near future and will be driven by inflation, general economic trends, market dynamics and other regulatory changes. In order to restrict these cost inputs, there is a continuous programme throughout the Group to improve efficiencies and productivity. The SA gold operations have been restructured through a S189 consultation process as a consequence of ongoing financial losses experienced at the Beatrix and Driefontein mines with the process concluding on 5 June 2019. The recently acquired Marikana operations have also been restructured through a S189 consultation process pursuant to ongoing financial losses experienced at these operations with certain shafts having reached the end of their economic reserve lives. The aim of the restructuring was the rationalisation of overheads and the realisation of other synergies and efficiencies required to restore profitability and ensure the sustainability of the remaining shafts at the Marikana operations. This process was concluded on 16 January 2020.

The South African inflation rate or Consumer Price Index (CPI) was 4.1% in 2019 (2018: 4.7%). Inflation in the mining industry has historically been higher than CPI driven by above inflation wage increases and electricity tariffs.

Sibanye-Stillwater's operations are labour intensive. Labour represented 37% and 38% of cost of sales, before amortisation and depreciation during 2019 and 2018, respectively.

At the US PGM operations the collective bargaining agreement covering certain employees at the Stillwater Mine and the Metallurgical Processing facilities concluded the wage negotiations in April 2019. The new five-year agreement has similar terms to the prior agreement, with minor revisions. In terms of the agreement there was a 2.75% increase for all job categories effective from 15 April 2019, followed by annual increases of 2.5% for 2020, 3.0% in 2021, 2.5% in 2022 and 3.0% in 2023, of which all these effective increases are annually on 1 June.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Negotiations with the United Steel Workers International Union (USW) regarding East Boulder were concluded towards year-end 2017. A new four-year wage contract was signed that included a two-year extension. The next wage negotiations will be in December 2021. The agreed wage increases were a 1.0% increase effective 1 January 2018 and a US$1,000 bonus that was paid by 1 February 2018, followed by annual increases of 2.0% for 2019, 2.5% in 2020 and 2.0% in 2021.

Sibanye-Stillwater concluded a three-year wage agreement at the SA PGM operations on 15 November 2019, for its Rustenburg and Marikana operations which comprise the majority of its SA PGM operations, with the Association of Mineworkers and Construction Union (AMCU) at the Marikana operation and AMCU and UASA (formerly known as United Association of South Africa) at the Rustenburg operation in respect of wages and conditions of service for the period 1 July 2019 to 30 June 2022. The agreement allows for increases to the basic wage of Category 4- 9 surface and underground employees for both the Marikana and Rustenburg operations of R1,000 per month or 5% whichever is the higher in the first year, R1,000 per month or 5% whichever is the higher in the second year and R1,000 per month or 5% whichever is the higher in the third year. The pensionable base pay will increase by 3.5% for the Marikana operation over each of the next three years while the Rustenburg pensionable base pay and allowance base will increase by 5% over each of the next three years. In both operations the rock drill operators' allowance also increases by R100 per month for each of the three years. Miners, artisans and officials will receive R1,000 per month or 5% whichever is the higher per year for the three years.

The SA gold operations, signed a three-year wage agreement on 14 November 2018 with the National Union of Mineworkers (NUM), Solidarity and UASA in respect of wages and conditions of service for the period from 1 July 2018 to 30 June 2021. The agreement allows for increases to the basic wage of Category 4-8 surface and underground employees of R700 per month in the first and second years, and R825 per month in the third year. Miners, artisans and officials will receive increases of 5.5% in year one and 5.5% or CPI (whichever is greater) in years two and three of the agreement. In addition to the basic wage, the parties agreed to an increase in the current living-out allowance and Sibanye-Stillwater also agreed to increase incrementally the current minimum medical incapacity benefit.

At the SA gold operations on 19 November 2018, AMCU gave notice that its members would embark on protected strike action at our SA gold operations from the evening shift on 21 November 2018. On 17 April 2019, the November 2018 strike ended with AMCU and Sibanye-Stillwater concluding the Strike Settlement Agreement. In terms of the Strike Settlement Agreement, AMCU and the Group agreed to a facilitated post-strike conflict relationship building programme. AMCU signed the 2018 Wage Agreement and the Group agreed to an ex gratia payment of R4,000 for each employee at Sibanye-Stillwater's South African gold operations. The parties also agreed to withdraw all of the pending disputes relating to the strike that had been referred to the Labour Court.

Despite above inflation increases in electricity tariffs, power and water, it comprised 11% and 12% of cost of sales, before amortisation and depreciation in 2019 and 2018, respectively.

The effect of the abovementioned increases, especially being above the average inflation rate, has adversely affected and, may continue to adversely affect, the profitability of Sibanye-Stillwater's SA PGM and gold operations. Further, Sibanye-Stillwater's SA PGM and gold operations' costs are primarily denominated in rand, while revenues from PGM and gold sales are in US dollars. Generally when inflation is high the rand tends to devalue, thereby increasing rand revenues, and potentially offsetting any increase in costs. However, there can be no guarantee that any cost saving measures or the effects of any potential devaluation will offset the effects of increased inflation and production costs.

Production

Sibanye-Stillwater's revenues are driven by its production levels and the price it realises from the sale of PGMs, gold and associated co- and by- products, as discussed above. Production can be affected by a number of factors including mining grades, safety related work stoppages, industrial action, and other mining related incidents. These factors could have an impact on production levels in the future.

Sibanye-Stillwater's US PGM operations is in the process of improving production levels with the Blitz project currently underway. At the SA PGM operations the Marikana operations had its production plans optimized for efficiencies and cost savings with the intention of realizing these benefits during the 2020 financial year. Sibanye-Stillwater's SA gold operations are in their mature life stage and have encountered lower mining grades and yields.

Sibanye-Stillwater's SA PGM and gold operations are subject to South African health and safety laws and regulations that impose various duties on Sibanye-Stillwater's mines while granting the authorities powers to, among other things, close or suspend operations and order corrective action relating to health and safety matters. During 2019, Sibanye-Stillwater's SA PGM operations experienced 35 work stoppages (2018: 44) and the SA gold operations experienced 85 work stoppages (2018: 219).

In recent years, the South African mining industry has experienced increased union unrest. The entry of unions such as AMCU, which has become a significant rival to the traditionally dominant NUM, has resulted in more frequent industrial disputes, including violent protests, intra- union violence and clashes with police authorities. On 21 November 2018, a strike was called by AMCU at the SA gold operations and response plans were put in place to maintain peace and stability in order to ensure the safety of Sibanye-Stillwater's employees as far as possible, mitigate financial losses by optimising production through the concentration of underground mining activity to specific operating areas, and reducing fixed costs by switching off services and utilities across areas where production activity was suspended. Despite these plans having been implemented across the SA gold operations, the strike action continued to impact on our operations to varying extents in the 2019 year. The strike was resolved on 17 April 2019 after an agreement was reached but there was a delayed ramp up to full production which was only achieved during quarter four of 2019.

Sibanye-Stillwater's key focus is to maintain profitable operations and sustain current production levels for a longer period than had previously been envisaged, through an increased focus on productivity. Furthermore, focus will be on realising the extensive reserves and resources potential that still exists.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Royalties, carbon tax and mining tax

South African mining operations pay a royalty tax. The formula for calculating royalties takes into account the profitability of individual operations.

Carbon tax is a new tax in response to climate change, which is aimed at reducing greenhouse gas emissions in a sustainable, cost effective and affordable manner. In South Africa the Carbon Tax Act of 2019 came into effect on 1 June 2019.The South African Government introduced Carbon tax based on a polluter-pays-principle and the aim of which is to help ensure that companies and consumers take the negative adverse costs (externalities) of climate change into account in their future production, consumption and investment decisions. The group has provided for carbon tax of R12.9 million for 2019 (2018: Rnil).

Under South African tax legislation, gold mining companies and non-gold mining companies are taxed at different rates. Sibanye-Stillwater's SA gold operations are subject to the gold tax formula on their respective mining incomes. The formula calculating tax payable, is affected by the profitability of the applicable mining operation. In addition, these operations are ring fenced, so each operation is taxed separately and, as a result, taxable losses and capital expenditure at one of the operations cannot be used to reduce taxable income from another operation. Depending on the profitability of the operations, the tax rate can vary significantly from year to year.

A number of US tax bills were implemented during 2018 which affected the US PGM operations of which the most significant change resulted in tax now being calculated on all US entities falling under common control. With contract changes during 2019, the US PGM operations experienced a shift of its tax exposure out of New Jersey state resulting in a deferred tax rate adjustment of R1,574.1 million (benefit).

Capital expenditure

Sibanye-Stillwater will continue to invest capital in new and existing infrastructure and possible growth opportunities. Therefore, management will be required to consider, on an ongoing basis, the capital expenditure necessary to achieve its sustainable production objectives against other demands on cash.

As part of its strategy, Sibanye-Stillwater may investigate the potential exploitation of mineralisation below its current infrastructure limits as well as other capital-intensive projects.

In 2019, Sibanye-Stillwater's total capital expenditure was R7,707 million (2018: R7,081). Sibanye-Stillwater expects to spend approximately R10.5 billion on capital in 2020, which includes the capital expenditure of DRDGOLD and the Marikana operations.

The actual amount of capital expenditure will depend on a number of factors, such as production volumes, the commodity prices and general economic conditions and may differ from the amount forecast above. Some of these factors are outside of the control of Sibanye-Stillwater.

Recent acquisitions

Lonmin acquisition

On 14 December 2017, Sibanye-Stillwater announced that it had reached an agreement with Lonmin Plc (Lonmin) on the terms of a recommended all-share offer to acquire the entire issued and to be issued ordinary share capital of Lonmin (the Lonmin Acquisition). The Lonmin Acquisition was effected by means of a scheme of arrangement between Lonmin and the Lonmin shareholders under Part 26 of the UK Companies Act. Under the initial terms of the Lonmin Acquisition, each Lonmin shareholder was entitled to receive: 0.967 new Sibanye-Stillwater shares for each Lonmin share (Initial offer), which was subsequently increased on 25 April 2019.

On 15 May 2018, Sibanye-Stillwater received South African Reserve Bank approval for the proposed acquisition of Lonmin and on 28 June 2018, the proposed Lonmin transaction was unconditionally cleared by the UK Competition and Markets Authority. On 21 November 2018, Sibanye- Stillwater announced that the Competition Tribunal had approved the proposed acquisition of Lonmin, subject to specific conditions. In addition to the conditions agreed between Sibanye-Stillwater and the Competition Commission, a further condition had been imposed by the Competition Tribunal, namely a moratorium on retrenchments at the Lonmin operations for a period of six months from the implementation date.

On 25 April 2019, the boards of Sibanye-Stillwater and Lonmin reached agreement on the terms of an increased recommended all-share offer pursuant to which Sibanye-Stillwater, and/or a wholly owned subsidiary of Sibanye-Stillwater, was to acquire the entire issued and to be issued ordinary share capital of Lonmin (the Increased Offer). Under the terms of the Increased Offer, Lonmin shareholders were entitled to receive one new Sibanye-Stillwater share for each Lonmin share.

The Lonmin Transaction (or scheme) was approved by the UK Court on 7 June 2019 (effective date) and all the conditions precedent to the Lonmin Transaction were fulfilled. Sibanye-Stillwater obtained control of Lonmin on this date. The effective date of the implementation of the Lonmin Transaction was 10 June 2019, when Lonmin's listing on the Financial Conduct Authority's Official List and the trading of Lonmin shares on the London Stock Exchange's Main Market for listed securities was suspended, and 290,394,531 new Sibanye-Stillwater shares were listed on the Johannesburg Stock Exchange.

The year end of Lonmin has been changed to 31 December 2019 and Lonmin is consolidated from the effective date. Results of Lonmin (Marikana operations) are presented for the seven months ended 31 December 2019 following completion of the acquisition, see -Consolidated

financial statements-Notes to the consolidated financial statements-Note 14.1: Lonmin acquisition.

SFA (Oxford) acquisition

On 21 February 2019, Sibanye-Stillwater announced it had agreed to acquire SFA (Oxford) Limited (SFA Oxford), an established analytical consulting company that is a globally recognised authority on PGMs and has for several years provided in-depth market intelligence on battery materials and precious metals for industrial, automotive, and smart city technologies.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

The acquisition was subject to the fulfilment of various conditions precedent which were completed on 4 March 2019. Sibanye-Stillwater obtained control on this date.

Results of SFA (Oxford) are presented for the ten months ended 31 December 2019 following completion of the acquisition, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note14.2: SFA (Oxford) acquisition.

Qinisele Resources acquisition

On 29 October 2019, Sibanye-Stillwater entered in to a sale of shares agreement (the agreement) to buy the entire issued share capital of Qinisele Resources, a boutique advisory company that specialises in corporate finance, investor relations and research for a total of R54.8 million.

The acquisition was subject to the fulfilment of various conditions precedent which were completed on 31 October 2019. Sibanye-Stillwater obtained control on this date.

Results of Quinsele are presented for the two months ended 31 December 2019 following completion of the acquisition, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note14.3: Qinisele Resources acquisition.

Acquisition costs

Sibanye-Stillwater incurred R284 million (2018: R117 million) on acquisition costs related to the Lonmin acquisition.

Sibanye-Stillwater has pursued and may continue to pursue growth opportunities that allow it to leverage its existing processing capacity and infrastructure and to extend its operating life. Such growth may continue to occur through the acquisition of other companies and assets, development projects, or by entering into joint ventures. Sibanye-Stillwater may incur acquisition and integration related costs with regard to any operations or entities that it acquires or seeks to acquire in the future.

2019 financial performance compared with 2018

Group profit for the year increased from a loss of R2,521 million in 2018 to a profit of R433 million in 2019. The reasons for this increase are discussed below.

The primary factors explaining the movements in profit/(loss) are set out in the table below.

			% Change
Figures in million - SA rand	2019	2018	2019/2018
Revenue	72,925	50,656	44
Cost of sales	(63,315)	(48,129)	32
Finance expense	(3,303)	(3,135)	5
Share-based payments	(363)	(299)	22
(Loss)/gain on financial instruments	(6,015)	1,704	(453)
Gain on foreign exchange differences	326	1,169	(72)
Share of results of equity-accounted investees after tax	721	344	110
Impairments	(86)	(3,041)	(97)
Gain on derecognition of borrowings and derivative financial instrument	-	230	(100)
Occupational healthcare expense	40	(15)	(364)
Gain on acquisition	1,103	-	100
Restructuring costs	(1,252)	(143)	776
Transaction costs	(448)	(403)	11
Care and maintenance costs	(766)	(577)	33
Change in estimate of environmental rehabilitation obligation	(89)	67	(233)
Strike related costs	(402)	(32)	1,169
Net other	68	380	(82)
(Loss)/profit before royalties, carbon tax and tax	(856)	(1,224)	(30)
Royalties	(431)	(213)	102
Carbon tax	(13)	-	100
(Loss)/profit before tax	(1,300)	(1,437)	(10)
Mining and income tax	1,733	(1,084)	(260)
Profit/(loss) for the year	433	(2,521)	117

The consolidation of the Marikana operations operational and financial results for seven months in 2019 and the inclusion of DRDGOLD's operational and financial results for the full year in 2019 compared with five months in 2018, skews the direct comparison of the 2019 with the 2018 financial results of the Group.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Revenue

Revenue increased by 44% to R72,925 million in 2019 from R50,656 million in 2018, driven by rising precious metals prices during the second half of 2019, as well as the inclusion of the Marikana operations from June 2019, which contributed R11,188 million to Group revenue.

Revenue from the US PGM operations increased by 69% to R26,865 million in 2019 from R15,873 million in 2018, due to a higher average 2E basket price received, which increased by 39% to US$1,403/2Eoz in 2019 from US$1,007/2Eoz in 2018, mainly as a result of increased palladium prices which contributed to the higher basket price combined with a rand that weakened by 9% against the US dollar and a 24% increase in recycling volumes in 2019.

Revenue from the SA PGM operations increased by 82% to R27,578 million in 2019 from R15,154 million in 2018, due to a higher average 4E basket price received, which increased by 44% to R19,994/4Eoz in 2019 from R13,838/4Eoz in 2018, mainly as a result of increased palladium and rhodium prices and the inclusion of revenue from the Marikana operations of R11,188 million in 2019. The Rustenburg operations had a 45% decrease in 4Eoz sold due to the build-up in inventory as part of the transitioning to the Toll processing during the first four months of 2019.

The increase in revenue from the PGM operations offset a 5% decline in revenue from the SA gold operations to R18,644 million in 2019 from

R19,657 million in 2018. Revenue from the SA gold operations of R15,023 million in 2019, excluding DRDGOLD of R3,621 million (2018:

R1,048 million), declined by 19% due to the industrial action which had a direct impact on production followed by a slow ramp up to normal production capacity during quarter four of 2019.

Revenue increased by 10% to R50,656 million in 2018 from R45,912 million in 2017. The solid production results from both the US and SA PGM operations and higher PGM basket prices, offset lower revenue from the SA gold operations, due to the operational disruptions and a flat rand gold price year-on-year.

Revenue from the US PGM operations increased by 73% to R15,873 million in 2018 from R9,162 million in 2017, due to the inclusion of revenue for the full year in 2018 compared with eight months in 2017, additional production from Blitz, and a 9% increase in the average basket price received.

Revenue from the SA PGM operations increased by 14% to R15,154 million in 2018 from R13,276 million in 2017, mainly due to a 10% increase in the average basket price received.

Revenue from the SA gold operations, excluding DRDGOLD of R1,048 million, declined by 21% due to the significant operational challenges experienced during the first half of 2018, additional safety interventions and the AMCU strike at the end of 2018, which affected production.

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Cost of sales

Cost of sales increased by 32% to R63,315 million in 2019 from R48,129 million in 2018, with the incorporation of the Marikana operations for seven months which accounted for R8,940 million of this increase. Cost of sales increased by 14% to R48,129 million in 2018 from R42,182 million in 2017, with the incorporation of DRDGOLD for five months which accounted for R1,078 million of this increase.

The primary drivers of cost of sales are set out in the table below.

The analysis that follows provides a more detailed discussion of cost of sales, together with the total cash cost, All-in sustaining cost and All-in cost.

			% Change
Figures in million - SA rand	2019	2018	2019/2018
Salaries and wages	21,163	15,710	35
Consumable stores	12,784	9,328	37
Utilities	6,089	5,049	21
Mine contracts	3,566	3,198	12
Recycling	13,969	7,196	94
Other	2,095	4,564	(54)
Ore reserve development costs capitalised	(3,566)	(3,530)	1
Cost of sales, before amortisation and depreciation	56,100	41,515	35
- US PGM operations	19,569	11,721	67
- SA PGM operations	9,757	12,096	(19)
- Marikana operations	8,440	-	100
- SA gold operations, excluding Cooke and DRDGOLD	14,981	15,985	(6)
- Cooke	617	693	(11)
- DRDGOLD	2,736	1,020	168
Amortisation and depreciation	7,214	6,614	9
- US PGM operations	2,286	2,234	2
- SA PGM operations	1,419	1,075	32
- Marikana operations	500	-	100
- SA gold operations, excluding Cooke and DRDGOLD	2,822	3,241	(13)
- Cooke	15	6	150
- DRDGOLD	172	58	197
Total cost of sales	63,314	48,129	32
- US PGM operations	21,855	13,955	57
- SA PGM operations	11,176	13,171	(15)
- Marikana operations	8,940	-	100
- SA gold operations, excluding Cooke and DRDGOLD	17,803	19,226	(7)
- Cooke	632	699	(10)
- DRDGOLD	2,908	1,078	170

Cost of sales, before amortisation and depreciation

Cost of sales, before amortisation and depreciation increased by 35% to R56,100 million in 2019 from R41,515 million in 2018. This included cost of sales, before amortisation and depreciation of R19,569 million from the US PGM operations, which increased by 67% mainly due to the 24% increase in recycling volumes. Cost of sales, before amortisation and depreciation from the SA PGM operations excluding the Marikana operations decreased by 19% to R9,757 million in 2019 from R12,096 million in 2018 due to the build-up in inventory as part of the transition to the Toll processing during the first four months of 2019. Cost of sales, before amortisation and depreciation at the Marikana operations during 2019 was R8,440 million. Cost of sales, before amortisation and depreciation at the SA gold operations excluding DRDGOLD decreased by 7% to R15,598 million in 2019 from R16,678 million in 2018 mainly as a direct result of the strike at the SA gold operations. Cost of sales, before amortisation of DRDGOLD of R2,736 million increased by 168% mainly due to the inclusion of DRDGOLD for twelve months and increased production at the Far West Gold recoveries tailings retreatment operation which commenced operation during April 2019.

Cost of sales, before amortisation and depreciation increased by 14% to R41,515 million in 2018. Cost of sales before amortisation and depreciation at the US PGM operations of R11,721 million increased by 67% due to the inclusion for the full year in 2018 compared with eight months in 2017 and additional production from Blitz. Cost of sales, before amortisation and depreciation from the SA PGM operations increased by 4% to R12,096 million in 2018 due to above inflation increases in wages and electricity, partly offset by synergies realised. Cost of sales, before amortisation and depreciation at the SA gold operations decreased by 1% to R17,698 million in 2018 mainly due to the strike, offset by an increase in DRDGOLD of R1,020 million.

Amortisation and depreciation

Amortisation and depreciation increased by 9% to R7,214 million in 2019 from R6,614 million in 2018. This included amortisation and depreciation of R500 million relating to the Marikana operations which was acquired during 2019, and R172 million (2018: R58 million) from DRDGOLD which was acquired during 2018. The amortisation and depreciation from the US PGM operations for 2019 of R2,286 million was flat against the 2018 amount of R2,234 million. The amortisation and depreciation from the SA PGM operations increased by 32% to R1,419 million in 2019 from R1,075 million in 2018 due to an increase in production. The amortisation and depreciation for 2019 at the SA gold operations excluding

Sibanye-Stillwater Annual Financial Report 2019

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

DRDGOLD of R172 million decreased by 13%, mainly due to lower production as a result of a slow return to full production capacity, post the end of the five month industrial action (April 2019).

All-in sustaining cost and All-in cost

All-in cost per ounce, was introduced in 2013 by the members of the World Gold Council. Sibanye-Stillwater has adopted the principle prescribed by the Council. This non-IFRS measure provides more transparency into the total costs associated with mining.

The All-in cost per ounce metric provides relevant information to investors, governments, local communities and other stakeholders in understanding the economics of mining. This is especially true with reference to capital expenditure associated with developing and maintaining mines, which has increased significantly in recent years and is reflected in this metric.

All-in costs exclude income tax, costs associated with merger and acquisition activities, working capital, impairments, financing costs, one-time severance charges and items needed to normalise earnings.

All-in costs is made up of All-in sustaining costs, being the cost to sustain current operations, given as a sub-total in the All-in costs calculation, together with corporate and major capital expenditure associated with growth.

Non-IFRS measures such as All-in sustaining costs and All-in costs are considered as pro forma financial information as per the JSE Listing Requirements. The pro forma financial information is the responsibility of the Group's Board of Directors and is presented for illustration purposes only, and because of its nature, All-in sustaining costs and All-in costs should not be considered as a representation of financial performance.

This pro forma financial information has been reported on by Ernst & Young Inc. in terms of ISAE 3420 and their unmodified report is available for inspection at the Company's registered office.

Sibanye-Stillwater Annual Financial Report 2019

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENT continued

																Group
																Corporat
									Corporat							e
		Total							e							and
		US PGM	Total						and re-	Total						reconcilin
Figures in million - SA		operations	SA PGM	Rustenburg	Marikana		Platinum		conciling	SA gold						g
rand	Group	Stillwater	operations	operations	operations Kroondal	Mile	Mimosa	items	operations	Driefontein	Kloof	Beatrix	Cooke DRDGOLD	items
2019
Cost of sales, before
amortisation and		5,600.8	18,196.6							18,334.4
depreciation	Rm	6,466.9	8,439.9	3,076.3	213.6	1,336.3	(1,336.4)	4,438.6	6,872.9	3,669.3	617.3	2,736.3	-
Plus:		-	92.5							56.6
Community costs1	Rm	57.1	35.3	0.1	-	-	-	17.6	21.7	14.8	2.5	-	-
Inventory change	Rm	325.8	4,664.2	4,182.4	481.8	-	-	-	-	-	-	-	-	-	-	-
Share-based payments2	Rm	53.4	-	-	-	-	-	-	-	64.2	-	-	-	-	64.2	-
Royalties3	Rm	-	357.3	295.8	54.0	7.5	-	77.1	(77.1)	73.7	16.5	34.0	19.0	4.1	-	0.1
Carbon tax4	Rm	-	0.9	0.3	0.5	0.2	-	-	(0.1)	12.0	0.1	0.1	11.8	-	-	-
Rehabilitation5	Rm	12.9	160.5	(8.9)	91.4	78.0	-	(4.3)	4.3	203.4	26.0	53.0	66.7	31.7	20.7	5.3
Leases6	Rm	2.4	46.1	13.8	23.7	8.6	-	-	-	61.1	8.1	20.9	15.4	16.7	-	-
ORD7	Rm	1,036.2	1,029.2	500.6	528.6	-	-	-	-	1,336.5	512.9	590.4	233.2	-	-	-
Sustaining capital		321.7	1,203.2							514.4
expenditure8	Rm	316.3	660.4	212.8	13.3	343.1	(342.7)	163.0	238.1	70.5	-	42.8	-
Less:		(619.6)	(3,601.7)							(19.8)
By-product credit9	Rm	(1,758.1)	(1,313.5)	(529.2)	(0.9)	(334.8)	334.8	(4.1)	(5.0)	(3.7)	(1.9)	(5.1)	-
All-in sustaining cost10	Rm	6,733.6	22,148.8	10,066.2	9,002.1	2,854.3	226.0	1,417.4	(1,417.2)	20,636.5	5,178.7	7,826.1	4,097.0	670.4	2,858.9	5.4
Plus:
Corporate cost, growth and		2,035.0	25.9							513.8
other capital expenditure	Rm	1.8	10.7	-	13.4	-	-	-	108.9	2.1	-	39.0	363.8
All-in cost10	Rm	8,768.6	22,174.7	10,068.0	9,012.8	2,854.3	239.4	1,417.4	(1,417.2)	21,150.3	5,178.7	7,935.0	4,099.1	670.4	2,897.9	369.2
Gold sold/4E PGM
produced/2E PGM		18,475	50,025							28,743
produced	kg	21,699	15,788	8,243	639	3,656	-	5,096	10,829	5,978	1,288	5,552	-
	'000oz	594.0	1,608.3	697.6	507.6	265.0	20.5	117.6	-	924.1	163.8	348.2	192.2	41.4	178.5	-
All-in sustaining cost10	R/kg	11,337	14,857							717,966	1,016,228	722,698	685,346	520,497	514,932	-
	R/oz	14,429	17,735	10,771	11,006	12,058	-
	US$/oz	784	1,027	998	1,226	745	761	834	-	1,544	2,186	1,555	1,474	1,120	1,108	-
All-in cost10	R/kg	14,763	14,875							735,842	1,016,228	732,755	685,698	520,497	521,956	-
	R/oz	14,432	17,756	10,771	11,658	12,058	-
	US$/oz	1,021	1,029	998	1,228	745	806	834	-	1,583	2,186	1,576	1,475	1,120	1,123	-

Sibanye-Stillwater Annual Financial Report 2019

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENT continued

																Group
																Corporat
									Corporat							e
		Total							e							and
		US PGM	Total						and re-	Total						reconcilin
Figures in million - SA		operations	SA PGM Rustenburg	Marikana		Platinum		conciling	SA gold						g
rand	Group	Stillwater operations	operationsoperations Kroondal	Mile	Mimosa	items operationsDriefontein	Kloof	Beatrix	Cooke DRDGOLD	items
2018
Cost of sales, before
amortisation and		4,524.4	12,096.0							17,698.4
depreciation	Rm	9,203.9	-	2,739.4	152.7	1,235.7	(1,235.7)	5,709.3	6,364.8	3,910.8	693.4	1,020.1	-
Plus:		-	23.3							46.8
Community costs1	Rm	23.1	-	0.3	-	-	(0.1)	14.6	10.4	15.8	6.0	-	-
Inventory change	Rm	(34.7)	-	-	-	-	-	-	-	-	-	-	-	-	-	-
Share-based payments2	Rm	35.7	-	-	-	-	-	-	-	3.4	0.2	-	-	-	3.2	-
Royalties3	Rm	-	162.0	156.5	-	5.5	-	57.6	(57.6)	93.5	25.6	40.7	23.0	4.2	-	-
Carbon tax4	Rm	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-
Rehabilitation5	Rm	9.3	83.1	6.0	-	77.1	-	(7.9)	7.9	22.0	(17.1)	(45.8)	30.0	39.0	29.2	(13.3)
Leases6	Rm	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-
ORD7	Rm	998.9	477.9	477.9	-	-	-	-	-	2,053.6	817.1	839.6	396.9	-	-	-
Sustaining capital		260.2	464.4							545.8
expenditure8	Rm	313.5	-	141.4	9.5	170.9	(170.9)	228.1	220.6	82.6	-	14.5	-
Less:										-
By-product credit9	Rm	(463.6)	(2,357.6)	(1,897.5)	-	(450.4)	(9.7)	(326.5)	326.5	(119.7)	(6.1)	(6.2)	(4.3)	(101.9)	(1.3)	0.1
All-in sustaining cost10	Rm	5,330.2	10,949.1	8,283.4	-	2,513.3	152.5	1,129.8	(1,129.9)	20,343.8	6,771.7	7,424.1	4,454.8	640.7	1,065.7	(13.2)
Plus:
Corporate cost, growth and		1,574.0	57.7							944.3
other capital expenditure	Rm	0.6	-	-	57.1	-	-	0.4	141.8	1.7	-	303.3	497.1
All-in cost10	Rm	6,904.2	11,006.8	8,284.0	-	2,513.3	209.6	1,129.8	(1,129.9)	21,288.1	6,772.1	7,565.9	4,456.5	640.7	1,369.0	483.9
Gold sold/4E PGM
produced/2E PGM		18,432	36,568							36,489
produced	kg	24,209	-	7,937	547	3,875	-	9,573	15,164	8,536	1,346	1,870	-
	'000oz	592.6	1,175.7	778.3	-	255.2	17.6	124.6	-	1,173.1	307.8	487.5	274.4	43.3	60.1	-
All-in sustaining cost10	R/kg	8,994	10,417							557,530	707,375	489,587	521,884	476,003	569,893
	R/oz	10,642	-	9,849	8,676	9,069	-							-
	US$/oz	677	787	804	-	744	655	685	-	1,309	1,661	1,150	1,226	1,118	1,338	-
All-in cost10	R/kg	11,651	10,472							583,409	707,417	498,938	522,083	476,003	732,086
	R/oz	10,643	-	9,849	11,924	9,069	-							-
	US$/oz	880	791	804	-	744	900	685	-	1,370	1,661	1,172	1,226	1,118	1,719	-

Sibanye-Stillwater Annual Financial Report 2019

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENT continued

The average exchange rate for the year ended 31 December 2019 was R14.46/US$ (2018: R13.24/US$)

1. Community costs includes costs related to community development
2. Share-basedpayments include share-based payments compensation cost to support Sibanye-Stillwater's corporate structure not directly related to current production. Share-based payments are calculated based on the fair value at initial recognition and do not include the fair value adjustment of the cash-settledshare-based payment liability to the reporting date fair value
3. Royalties are the current royalty on refined and unrefined minerals payable to the South African government

4In South Africa the Carbon Tax Act of 2019 came into effect on 1 June 2019.The South African Government introduced Carbon tax based on a polluter-pays-principle and the aim of which is to help ensure that companies and consumers take the negative adverse costs (externalities) of climate change into account in their future production, consumption and investment decisions. The first phase has a carbon tax rate of R120 per ton of carbon dioxide equivalent emissions. This rate will increase annually by inflation plus 2 per cent until 2022, and annually by inflation thereafter

1. Rehabilitation includes the interest charge related to the environmental rehabilitation obligation and the amortisation of the related capitalised rehabilitation costs recorded as an asset. The interest charge related to the environmental rehabilitation obligation and the amortisation of the capitalised rehabilitation costs do not reflect annual cash outflows and are calculated in accordance with IFRS. The interest charge and amortisation reflect the periodic costs of rehabilitation associated with current production and are, therefore, included in the measure
2. Leases represent the lease payment costs for the year
3. ORD are those capital expenditures that allow access to reserves that are economically recoverable in the future, including, but not limited to, crosscuts, footwalls, return airways and box holes which will avail production or reserves
4. Sustaining capital expenditure are those capital expenditures that are necessary to maintain current production and execute the current mine plan. Sustaining capital costs are relevant to the All-in cost metric as these are needed to maintain Sibanye-Stillwater's current operations and provide improved transparency related to Sibanye-Stillwater's ability to finance these expenditures
5. By-productcredit-TheAll-in cost metric is focused on the cost associated with producing and selling a kilogram of gold 4E/2E PGMs, and therefore the metric captures the benefit of mining other metals when gold and 4E/2E PGMs are produced and sold. In determining the All-in cost, the costs associated with producing and selling a kilogram of gold or an ounce of 4E/2E PGMs are reduced by the benefit received from the sale of co-products and by-products, recognised as product sales, which is extracted and processed along with the gold and 4E/2E PGMs produced. At the SA gold operations, the sale of silver is recognised as product sales, and at the PGM operations in both regions, the minor PGMs - iridium and ruthenium - are produced as co-products, which together with the three primary PGMs, are referred to as 6E (5PGM+Au). In addition, nickel, copper and chrome, among other minerals, are by-products at these operations. This is relevant to the All-in cost metric as it aids in the investor's analysis of the profitability of producing a kilogram of gold or an ounce of 4E/2E PGMs, without the need to consider multiple metal prices
6. For information on how Sibanye-Stillwater has calculated All-in sustaining costs, All-in costs, All-in sustaining cost per kilogram, All-in sustaining cost per ounce, All-in cost per kilogram and All-in cost per ounce, see -Overview-Five year financial performance-Group operating statistics-Footnote 5

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Cost of production

The All-in sustaining cost (AISC) at the US PGM operations increased by 16% to US$784/2Eoz in 2019 primarily due to increased PGM prices which drives an increase in royalties. Increases in labour costs due to budgeted additional hires, mobile maintenance of plant and contractors who were used to recoup lost production mainly at the Stillwater Mine, all accounted for approximately 54% of the increase in AISC at the US PGM operations. AISC increases by approximately US$5/2Eoz for every US$100/2Eoz change in the prevailing PGM basket. The AISC at the SA PGM operations of R14,857/4Eoz in 2019 increased by 43% from R10,417/4Eoz in 2018 primarily due to the inclusion of the higher cost Marikana operations with an AISC of R17,735/4Eoz and an increase in processing costs at Rustenburg following the transition from a Purchase of Concentrate to a Toll processing arrangement. Unit costs at the SA gold operations increased to R717,966/kg in 2019 from R557,530/kg in 2018 and was due to the strike impact and resultant decrease in production volumes.

The AISC cost at the US PGM operations increased by 4% to US$677/2Eoz in 2018 mainly due to the frontloading of skills for the Blitz project, increased royalties due to the improved basket price, higher maintenance cost and planned outages in the metallurgical complex. The AISC at the SA PGM operations of R10,417/4Eoz in 2018 was in line with the cost performance in 2017 of R10,399/4Eoz. Unit costs at the SA gold operations were primarily affected by the safety incidents and other unanticipated operational disruptions as well as the strike, increasing the AISC to R557,530/kg in 2018 from R482,693/kg in 2017.

Adjusted EBITDA

Adjusted EBITDA of R14,956 million in 2019 increased by 79% from R8,369 million in 2018, with adjusted EBITDA from the US and SA PGM operations increasing by 76% and 205%, respectively. The adjusted EBITDA increased at the PGM operations due to higher PGM basket prices (US and SA PGM operations), the inclusion of the Marikana operations for seven months (SA PGM operations), partially offset by reduced sales at the Rustenburg operation as a result of the change from Purchase of Concentrate to a Toll processing arrangement. The 21% decline in the SA gold production, mainly due to the industrial action, resulted in a decrease in adjusted EBITDA from an adjusted EBITDA of R1,362 million in 2018 to an adjusted EBITDA loss of R969 million in 2019.

Adjusted EBITDA includes other cash costs, strike costs and care and maintenance expenditures. Care and maintenance at Cooke and Burnstone were R548 million and R46 million for 2019, respectively, compared with R564 million and R12 million, respectively in 2018. Care and maintenance at the Marikana operations were R155 million (2018: Rnil). Strike costs at the SA gold operations were R402 million (2018: R38 million). Other costs include corporate and social expenditure of R149 million (2018: R70 million) and non-production royalties of R40 million (2018: R105 million).

Non-IFRS measure such as Adjusted EBITDA is considered as pro forma financial information as per the JSE Listing Requirements. The pro forma financial information is the responsibility of the Group's Board of Directors and is presented for illustration purposes only, and because of its nature, Adjusted EBITDA should not be considered as a representation of financial performance.

This pro forma financial information has been reported on by Ernst & Young Inc. in terms of ISAE 3420 and their unmodified report is available for inspection at the Company's registered office.

Finance expense

Finance expense increased by 5% to R3,303 million in 2019 from R3,135 million in 2018. Included in finance expense in 2019 was R1,445 million interest on borrowings, R374 million unwinding of the amortised cost on the 6.125% Notes due on 27 June 2022 (the 2022 Notes) and 7.125% Notes due on 27 June 2025 (the 2025 Notes) (together the 2022 and 2025 Notes), R579 million environmental rehabilitation liability accretion expense, R116 million occupational healthcare liability accretion expense, R179 million unwinding of the Deferred Payment related to the Rustenburg operation, R352 million unwinding of the deferred revenue related to the streaming transactions (Wheaton and Bulk Tailings reTreatment plant), R21 million interest on the dissenting shareholder liability and R203 million of sundry interest charges.

Finance expense increased in 2019 mainly due to the inclusion of both the unwinding of the deferred revenue on the Bulk Tailings re-Treatment plant and an increase in the environmental rehabilitation liability accretion expense from the acquisition of the Marikana operations.

Included in finance expense in 2018 was R1,573 million interest on borrowings, R538 million unwinding of the 2022 and 2025 Notes, US$ senior unsecured guaranteed convertible bonds due 2023 (US$ Convertible Bond) and Burnstone Debt, R399 million environmental rehabilitation liability accretion expense, R105 million occupational healthcare liability accretion expense, R200 million unwinding of the Deferred Payment,

R160 million unwinding of the deferred revenue related to the Wheaton streaming transaction and R159 million of sundry interest charges.

Sibanye-Stillwater's gross debt outstanding, excluding the Burnstone Debt and including the derivative financial instrument, was approximately R26.6 billion in 2019 compared with approximately R23.8 billion in 2018.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Share-based payments

The share-based payments expense increased by 21% to R363 million in 2019 from R299 million in 2018. The share-based payments expense includes R64 million (2018: R3 million) relating to the DRDGOLD cash settled share options and R290 million relating to equity-settled share options granted under the Sibanye-Stillwater Share Plans (2018: R282 million).

(Loss)/gain on financial instruments

The loss on financial instruments of R6,015 million in 2019 compared with a gain on financial instruments of R1,704 million in 2018. The net loss on financial instruments in 2019 was primarily due to a fair value loss on the US$ Convertible Bond derivative financial instrument of R3,911 million, driven by the increase in the share price during 2019, which resulted in the convertible bonds trading well above par. In addition, the fair value loss on the Sibanye Rustenburg Platinum BEE share-based payment obligation of R1,218 million and fair value loss on the revised cash flows of the deferred payment amounting to R724 million contributed to the increase in the loss on financial instruments. The increase in the fair value loss on these financial instruments is mainly due to higher expected long term PGM basket prices.

The gain on financial instruments of R1,704 million in 2018 was mainly due to a gain on revised cash flows of the Burnstone Debt of R805 million and the fair value gain on the derivative financial instrument of R678 million,

Gain on foreign exchange differences

The gain on foreign exchange differences of R326 million in 2019 compared with R1,169 million in 2018. The gain on foreign exchange differences in 2019 was mainly due to foreign exchange gains of R114 million and R176 million on the convertible bond and on the derivative financial instrument respectively due to the stronger rand. The gain on foreign exchange differences of R1,169 million in 2018 was mainly due to foreign exchange gains on financial assets of R2,216 million as a result of a 16% weaker rand. This gain was partly offset by foreign exchange losses on the US dollar borrowings, including the US$600 million revolving credit facility (RCF), US$350 million RCF, US$ Convertible Bond, derivative financial instrument and Burnstone Debt, of R1,194 million.

Share of results of equity-accounted investees after tax

The profit from share of results of associates of R721 million in 2019 (2018: R344 million) was primarily due to share of profits of R377 million

(2018: R211 million) relating to Sibanye-Stillwater's 50% attributable share in Mimosa and R344 million (2018: R144 million) relating to its 44.4% interest in Rand Refinery.

Gain on derecognition of borrowings and derivative financial instrument

On 5 September 2018, Sibanye-Stillwater concluded the tender process to repurchase a portion of the US$ Convertible Bond which resulted in a gain on early settlement of the borrowings of R230 million recognised in profit or loss.

Impairments

Impairments were R86 million in 2019 and R3,041 million in 2018. Impairments in 2019 mainly related to the impairment of goodwill that arose on the acquisition of Qinisele Resources which cannot be attributed to any current Sibanye-Stillwater operating cash generating units. On 31 December 2018 a decision was taken to impair the Driefontein and Beatrix mining assets by R2,172 million and R167 million, respectively , as a result of ongoing losses experienced, and the goodwill allocated to the SA gold operations by R436 million. In 2018 the development of the Burnstone project has been deferred and the Burnstone development assets were impaired by R194 million.

For additional information on the impairments, see -Consolidated financial statements-Notes to the consolidated financial statements-Note 8: Impairments.

Occupational healthcare expense

On 26 July 2019 the Gauteng High Court in Johannesburg approved the R5 billion settlement agreement in the silicosis class case. Sibanye- Stillwater has provided R1,282 million for its share of the settlement cost. The provision is consequently subject to adjustment in the future, based on the number of eligible workers. The estimated costs at 31 December 2019 was determined by an actuarial specialist and as a result, a change in estimate of R15 million was recognised in profit or loss. For additional information on the occupational healthcare expense, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note29: Occupational healthcare obligation.

Restructuring costs

Maintaining loss-making operations is not sustainable over an extended period. Cross-subsidising loss making operations erodes value, is a drain on cash flow and, as a result, threatens the sustainability and economic viability of other operations. The Group, therefore, continually reviews and assesses the operating and financial performance of its assets and during 2019 there was a review of the SA gold operations pursuant to ongoing losses experienced at the Beatrix and Driefontein operations and at the Marikana operations post its acquisition in June 2019.

Restructuring costs were incurred in 2019 of R1,252 million (2018: R143 million) and included voluntary separation packages. The restructuring costs mainly related to the SA gold operations and the Marikana operations and amounted to R357 million and R867 million respectively.

Sibanye-Stillwater Annual Financial Report 2019

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Transaction costs

Transaction costs were R448 million in 2019 compared with R403 million in 2018. The transaction costs in 2019 included advisory and legal fees of R284 million (2018: R117 million) related to the Lonmin acquisition, streaming transaction costs of R52 million, advisory and legal fees of R32 million related to the Sibanye Gold Limited internal restructuring, the dissenting shareholder liability legal costs of R20 million and platinum jewellery membership costs of R18 million. The transaction costs in 2018 mainly related to the DRDGOLD acquisition, the proposed Lonmin acquisition, and the dissenting shareholder liability legal costs

Gain on acquisition

A gain on acquisition of R1,103 million arose on the acquisition of Lonmin Plc (Lonmin or the Marikana operations) in 2019 and is attributable to the transaction being attractively priced, and is consistent with the statement by the boards of Sibanye Stillwater and Lonmin, that the purchase price reflected the recovery in PGM prices at the time of the increased offer, balanced against the fact that Lonmin, pre-acquisition, was financially constrained and unable to fund the significant investment required to sustain its business and associated employment.

Royalties

Royalties increased by 103% to R431 million in 2019 from R213 million in 2018. The increase in 2019 was mainly due to the increase in SA PGM revenue as a result of higher PGM basket prices. The 47% decrease in 2018 compared to 2017 was mainly due to the respective decrease in gold revenue and profitability.

Mining and income tax

Mining and income tax decreased to a credit of R1,733 million in 2019 compared with a charge of R1,084 million in 2018. The table below indicates Sibanye-Stillwater's effective tax expense rate in 2019 and 2018.

		2019	2018
Mining and income tax	Rm	(1,733.0)	1,083.8
Effective tax rate	%	133.3	(75.4)

In 2019, the tax credit on the loss before tax at the South African statutory company tax rate of 28.0%, or R364 million, compared with a credit of

R1,733 million mainly due to the tax effect of the following:

• R1,574 million deferred tax credit on the US PGM operations' due to contract negotiations during 2019, resulting in the state tax jurisdiction for the US PGM operations to change to the Pennsylvania state;
• R403 million net other non-taxable income and non-deductible expenditure;
• R202 million non-taxable share of results of equity-accounted investees; and
• R309 million non-taxable gain on acquisition.

The above was partially offset by the following:

• R571 million non-deductible loss on financial instruments;
• R384 deferred tax assets not recognised;
• R86 million non-deductible finance charges; and
• R81 million non-deductible share based payments.

In 2018, the tax credit on the loss before tax at the South African statutory company tax rate of 28.0%, or R402 million, compared with a charge of

R1,084 million mainly due to the tax effect of the following:

• R137 million non-taxable gain on financial instruments; and
• R250 million non-taxable gain on foreign exchange differences. The above were offset by the following:
• R118 million non-deductible finance charges;
• R123 million non-deductible impairments;
• R110 million non-deductible transaction costs;
• R1,545 million deferred tax charge on increase of the US PGM operations' long-term expected tax rate; and
• R377 million assessed losses and other deductible temporary differences not recognised.

Sibanye-Stillwater Annual Financial Report 2019

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Profit/(loss) for the year

As a result of the factors discussed above, the profit in 2019 was R433 million compared with the loss in 2018 of R2,521 million. The following table depicts contributions from various segments to the profit/(loss).

Figures in million - SA rand	2019	2018
US PGM operations	5,065	(1,531)
Stillwater	5,065	(1,531)
SA PGM operations	3,417	1,532
Rustenburg operation1	(10,827)	3,348
Marikana	1,881	-
Kroondal	1,336	315
Platinum Mile	43	33
Mimosa	377	211
Corporate and reconciling items1	10,606	(2,374)
SA gold operations	(7,887)	(2,334)
Driefontein	(2,553)	(3,522)
Kloof	(1,501)	295
Beatrix	(854)	(186)
Cooke	(531)	(627)
DRDGOLD	496	(591)
Corporate and reconciling items	(2,944)	2,296
Group Corporate and reconciling items	(162)	(187)

1 The net loss on the Rustenburg operation was impacted in 2019 by the fair value adjustment of R10,695 million on the obligation for future dividends payable to its shareholders in terms of the BEE SPV structure due to the higher long term PGM basket prices expected over the life of mine. This fair value adjustment eliminates in the corporate and reconciling items at a SA PGM operations level.

Liquidity and capital resources

Cash flow analysis

Net increase in cash and cash equivalents in 2019 was R3,129 million compared with R352 million in 2018.

The principal factors explaining the changes in net cash flow for the year are set out in the table below.

			% Change
Figures in million - SA rand	2019	2018	2019/2018
Net cash from operating activities	9,464	12,197	(22)
Adjusted for:	85
Dividends paid	1	(8,400)
Net interest paid	1,335	1,426	6
Deferred revenue advance received	(2,859)	(6,555)	(56)
Less:	(7,706)
Additions to property, plant and equipment	(7,081)	(9)
Adjusted free cash flow1	319	(12)	2,754
Acquisition of subsidiaries, net of cash acquired	2,875	283	916
Payments to dissenting shareholders	(319)	(1,376)	77
Proceeds on loss of control of subsidiaries and disposal of investments	-	257	(100)
Net proceeds from shares issued	1,688	-	100
Net borrowings (repaid)/raised	(3,027)	(4,101)	26

1 One of the drivers to sustain and increase shareholder value is adjusted free cash flow generation as that determines the cash available for dividends and other investing activities. Adjusted free cash flow is defined as net cash from operating activities before dividends paid, net interest paid and deferred revenue advance received, less additions to property, plant and equipment

Non-IFRS measures such as adjusted free cash flow are considered as pro forma financial information as per the JSE Listing Requirements. The pro forma financial information is the responsibility of the Group's Board of Directors and is presented for illustration purposes only, and because of its nature, adjusted free cash flow should not be considered a representation of cash from operating activities

This pro forma finanical information has been reported on by Ernst & Young Inc. in terms of ISAE 3420 and their unmodified report is available for inspection at the Company's registered office

Sibanye-Stillwater Annual Financial Report 2019

23

MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Cash flows from operating activities

Net cash from operating activities decreased by R2,733 million to R9,464 million in 2019 from R12,197 million in 2018. The items contributing to the decrease in 2019 and increase in 2018 are indicated in the table below.

Figures in million - SA rand	2019	2018
Increase in cash generated by operations1	1,857	1,611
(Decrease)/increase in deferred revenue advance received2	(3,696)	6,555
(Increase)/decrease in cash-settledshare-based payments paid	(69)	412
Decrease/(Increase) in change in working capital	444	(548)
Decrease in interest paid	18	433
(Increase)/decrease in royalties and tax paid3	(1,277)	357
(Increase)/decrease in dividends paid4	(84)	560
Other	74	77
(Decrease)/increase in cash flows from operating activities	(2,733)	9,457

1. The increase in cash generated by operations in 2019 and 2018 was mainly due to the increase in the average realised US and SA PGM basket prices, and negatively impacted by the operational disruptions experienced by the SA gold operations
2. On 11 April 2019, Sibanye-Stillwater concluded a forward gold sale arrangement where the Group received a cash prepayment of US$125 million (approximately R1.7 billion) in exchange for the future delivery of 105,906 ounces (3,294 kilograms) of gold in 4 equal parts on 1 October 2019, 15 October 2019, 31 October 2019 and 15 November 2019, subject to a floor price of US$1,200/oz and a cap price of US$1,323/oz (gold prepayment). On 21 October 2019, Sibanye-Stillwater concluded a forward gold sale arrangement where the Group received a cash prepayment of R1.1 billion in exchange for the future delivery of 8,482 ounces (263.8 kilograms) of gold every two weeks from 10 July 2020 to 16 October 2020 subject to an initial reference price of R17,371/oz comprising 80% of the prevailing price on execution date. This was offset by the decrease of R6,555 million (US$500 million) received through a streaming agreement with Wheaton International, a wholly- owned subsidiary of Wheaton Precious Metals Corp on closing of the transaction in 2018
3. The increase in royalties and tax paid in 2019 was due to the increase in taxable mining income as a result of increased US and SA PGM basket prices and the decrease in royalties and tax paid in 2018 was due to the decrease in taxable mining income
4. The Group declared no dividend in 2019 and 2018. The dividend declared and paid in 2019 related to dividends paid by subsidiary companies to their non-controlling shareholders

Adjusted free cash flow

Adjusted free cash flow during 2019 increased with cash received due to higher PGM basket prices at both the US and SA PGM operations and was significantly impacted by the operational disruptions and slow ramp up to full production capacity experienced by the SA gold operations. The Group recorded positive adjusted free cash flow of R319 million in 2019, which was an improvement of R331 million compared with 2018. In 2019, the US PGM operations recorded a 864% increase in positive free cash flow to R3,732 million and the SA PGM operations recorded a 209% increase in positive free cash flow to R2,726 million which was partially offset by negative free cash flow of R5,496 million from the SA gold operations.

Cash flows from investing activities

Net cash used in investing activities decreased to R4,865 million in 2019 from R7,744 million in 2018. The decrease in cash used in investing activities was mainly due to cash acquired of R2,999 million on the acquisition of the Marikana operations in 2019 (settled through the issue of Sibanye-Stillwater shares) and the payment of R1,376 million to the dissenting shareholders in 2018. Net cash used in investing activities decreased to R7,744 million in 2018 from R28,144 million in 2017 mainly due the acquisition of Stillwater in 2017 for R27,386 million, partly offset by the proceeds on disposal of Stillwater's marketable securities investments of R3,605 million in 2017.

Sibanye-Stillwater Annual Financial Report 2019

24

MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Capital expenditure increased by 9% to R7,706 million in 2019 from R7,081 million in 2018. Capital expenditure at the individual mines is shown in the table below.

Figures in million - SA rand	2019	2018
US PGM operations	3,393	2,833
Stillwater	3,393	2,833
SA PGM operations	2,248	1,000
Rustenburg operation	819	792
Marikana	1,189	-
Kroondal	213	141
Platinum Mile	27	67
Corporate and reconciling items	-	-
SA gold operations	2,066	3,248
Driefontein	676	1,046
Kloof	937	1,202
Beatrix	306	481
Cooke	-	-
DRDGOLD	82	318
Corporate and reconciling items	65	201

Capital expenditure increased from R7,081 million in 2018 to R7,707 million in 2019. Capital expenditure at the US PGM operations for 2019 was R3,393 million of which R2,035 million was spent on the Blitz and fill the mill projects. This compares to capital expenditure in 2018 of R2,833 million of which R1,574 million was spent on the Blitz project. Capital expenditure at the SA PGM operations increased from R1,000 million in 2018 to R2,248 million in 2019, mainly due to the inclusion of capital expenditure on the Marikana operations of R1,189 million. Capital expenditure at the SA gold operations excluding DRDGOLD declined from R2,930 million in 2018 to R1,984 million in 2019 due to the impact of the strike. Capital expenditure at DRDGOLD decreased from R318 million in 2018 to R82 million in 2019, mainly due to the Far West Gold Recoveries tailings retreatment operation which was completed during April 2019. Capital expenditure increased by R982 million in 2018 to R7,081 million from R6,099 million in 2017 mainly due to the inclusion of a full year from the US PGM expenditure compared with eight months in 2017.

Cash flows from financing activities

Net cash used in financing activities of R1,470 million in 2019 compared with cash used in financing activities of R4,101 million in 2018. Net cash used in financing activities comprised of lease payments of R132 million (2018: Rnil), loans repaid of R22,008 million (2018: R21,232 million) partially offset by loans raised of R18,982 million (2018: R17,130 million) and proceeds from shares issued of R1,688 million (2018: Rnil).

On 25 October 2019 the R6.0 billion RCF was successfully refinanced with a R5.5 billion RCF maturing on 10 November 2022. On 6 April 2018, Sibanye-Stillwater refinanced its US dollar RCF. The new facility increased from US$350 million to US$600 million.

During September 2018, Sibanye-Stillwater concluded and repurchased a portion of the:

• US$ Convertible Bond with aggregate principal amount of US$66 million for a total repurchase price of approximately US$50 million; and
• 2022 and 2025 Notes issued by Stillwater for the total repurchase price was approximately US$345 million (with a nominal value of US$349 million).

Net increase/(decrease) in cash and cash equivalents

As a result of the above, net cash and cash equivalents increased by R3,129 million in 2019 compared with an increase of R352 million in 2018. Total Group cash and cash equivalents amounted to R5,619 million at 31 December 2019 (2018: R2,549 million).

Statement of financial position

Borrowings

Total borrowings (short- and long-term) excluding R1,330 million attributable to Burnstone, which has no recourse to Sibanye-Stillwater's balance sheet, and including the R4,145 million derivative financial instrument increased to R26,551 million at 31 December 2019 from R23,769 million at 31 December 2018.

At 31 December 2019, Sibanye-Stillwater had committed unutilised banking facilities of R5,688 million available under the US$600 million RCF and R5.5 billion RCF.

For a description of borrowings, see -Consolidated financial statements-Notes to the consolidated financial statements-Note 26: Borrowings and derivative financial instrument.

Working capital and going concern assessment

For the year ended 31 December 2019, the Group realised a profit of R432.8 million (31 December 2018: loss of R2,520.7 million). As at 31

December 2019 the Group's current assets exceeded its current liabilities by R11,836.9 million (31 December 2018: R562.7 million) and the

Sibanye-Stillwater Annual Financial Report 2019

25

MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Group's total assets exceeded its total liabilities by R31,138.3 million (31 December 2018: R24,724.4 million). During the year ended 31

December 2019 the Group generated net cash from operating activities of R9,464.0 million (31 December 2018: R12,197.2 million).

The Group had available undrawn debt facilities of R5,688 million at 31 December 2019 (2018: R5,987 million) and cash balances of R5,619.0

million (31 December 2018: R2,549.1 million). On 11 November 2019 the R6.0 billion Revolving Credit Facility ("RCF") was refinanced by a R5.5 billion RCF maturing on 10 November 2022. US$150 million (R2,100 million) of the US$600 million RCF matures in April 2021, with the remainder of the facilities maturing after April 2022.

Sibanye-Stillwater's leverage ratio, based on the 12 month's financial results, (net debt to adjusted EBITDA) as at 31 December 2019 was 1.4:1 and its interest coverage ratio (adjusted EBITDA to net finance charges) was 6.5:1 (31 December 2018: 2.5:1 and 4.9:1). However, in terms of the allowed adjustments (annualised Marikana contribution to Group adjusted EBITDA) as per the facility agreements (net debt to adjusted EBITDA) as at 31 December 2019 was 1.25:1 and its interest coverage ratio (adjusted EBITDA to net finance charges) was 12.5:1. Both ratios are within the maximum permitted leverage ratio of at most 3.5:1 through to 31 December 2019, and 2.5:1 thereafter; and minimum required interest coverage ratio of 4.0:1, calculated on a quarterly basis, required under the US$600 million RCF and the R5.5 billion RCF (together the RCFs).

Various events during 2018 and 2019 (2018 safety issues, 2018/2019 gold strike and the SRPM offtake contract change from a purchase of concentrate to a toll processing arrangement) impacted negatively on group earnings and cash flows. Additionally, during 2019, the Group had to manage delays in the approval of the Lonmin acquisition, the take on of inherent uncertainties within the Lonmin business, alongside the now successfully concluded 3 yearly PGM wage negotiations. Liquidity levels were maintained throughout the year to manage this increased uncertainty. The Group issued 108.9 million ordinary shares for R1.7 billion on 15 April 2019 and executed a US$125 million (R1.8 billion) gold prepayment transaction on 11 April 2019, to enhance liquidity and balance sheet flexibility. A few days later, on 17 April 2019, AMCU, one of Sibanye-Stillwater's labour unions, withdrew its wage demands and ended its five-month strike action at the SA gold operations. In order to accommodate a potential breach in covenant ratios resulting from the impact of the strike at the SA Gold operations and the SRPM contract change, the RCF lenders approved a complete waiver of financial covenant compliance for the quarter ending 31 March 2019; and a leverage ratio of no more than 3.75:1 and an interest coverage ratio of at least 3.5:1 for the quarter ended 30 June 2019. Whilst the Group did not ultimately require these concessions, reporting a maximum leverage ratio of 2.98:1 and a minimum interest coverage ratio of 5.36:1 during 2019, it was deemed prudent to ensure that sufficient headroom was maintained within these financial covenants.

Gold and PGMs are sold in US dollars with most of the South African operating costs incurred in rand, as such the Group's results and financial condition will be impacted if there is a material change in the rand/US dollar exchange rate. High levels of volatility in commodity prices may also impact on profitability. Due to the nature of deep level mining, industrial and mining accidents may result in operational disruptions such as stoppages which could result in increased production costs as well as financial and regulatory liabilities. Further, Sibanye-Stillwater's operations may be adversely affected by production stoppages caused by labour unrests, union activity or other factors. The recent lockdown announced in South Africa due to the outbreak of COVID-19 (refer below) will adversely affect the 2020 production outlook for the South African operations. These factors will impact on cash generated or utilised by the Group, as well as adjusted EBITDA and financial covenants.

On 6 March 2020, Anglo American Platinum Limited (Anglo Plats) announced the temporary shutdown of its converter plant and issued a written notification of force majeure (FM) regarding the toll agreement between Anglo Plats and our Rustenburg operation and the purchase of concentrate agreement with our Kroondal and Platinum mile operations. Anglo Plats indicated that its converter plant will be unavailable for at least eight weeks (FM period). Sibanye-Stillwater reached agreement with Anglo Plats regarding the processing of all PGM containing material produced from the Rustenburg and Platinum Mile operations and approximately half of the PGM containing material produced from the Kroondal operation, at our Marikana processing facilities for at least the duration of the FM period. These agreements are expected to largely offset the delayed smelting and refining impact of the FM event on the Sibanye-Stillwater operations, but could, under normal operating circumstances, result in an estimated inventory working capital lockup of up to R2.5 billion in the first half of 2020 that is expected to be released during the second half of 2020.

In addition, on 23 March 2020, the President of the Republic of South Africa announced a nation-wide lockdown for 21 days effective from midnight on 26 March 2020 following the outbreak of COVID-19 in South Africa. Sibanye-Stillwater implemented measures to place its SA Gold and SA PGM operations on care and maintenance, as required under the lockdown regulations. During this initial lockdown period there was no production from our South African operations and the following initiatives were implemented to preserve liquidity at these operations:

• reduced variable overhead costs due to care and maintenance only, with costs limited to security, water pumping, ventilation, monitoring of infrastructure at shafts and plants and consumables associated with each activity;
• reduced labour cost from the third week of lockdown onwards; and
• force majeure announce to contractors not involved in the care and maintenance activity.

On 9 April 2020 the South African President announced that the lockdown period is extended for an additional 14 days. On 16 April 2020 a notice was published by the South African government which amended certain regulations previously issued in terms of Section 27(2) of the Disaster Management Act, 2002. These amendments, amongst others, allowed for South African mining operations to be conducted at a reduced capacity of not more than 50% during the period of lockdown, and thereafter at increasing capacity as determined by directives to be issued by the Minister of Mineral Resources and Energy. From 17 April 2020, management was in the process of implementing its strategy to mobilise the required employee complement and safely ramp up the South African operations to the initial 50% production capacity. This strategy includes:

• communications to employees and unions regarding the operational plan to ramp up production;
• start-uppreparations that include opening of services, ensuring appropriate ventilation, starting of belts, flushing of water pipes and consolidating impact of shutdown; and
• medical screening and training of employees to ensure a safe return to production.

Sibanye-Stillwater Annual Financial Report 2019

26

MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

In order to further proactively manage the COVID-19 threat at our US PGM operations and comply with the added requirements of local health authorities, a decision was made to reduce the number of people at our US sites, whilst maintaining production from current operations. Specific actions taken include:

• demobilising contractors involved in growth capital activities;
• facilitating remote work for personnel that are not required on site; and
• prohibiting face-to-face contact with external parties and restricting site access to employees.

The Blitz project accounts for the majority of contract workers at the US PGM operations and these decisions are likely to temporarily impact growth from Blitz in 2020 and delay the project's development schedule.

Management modeled various scenarios to determine the impact on the liquidity requirements of the Group of the Anglo Plats FM event, the extended lockdown in South Africa and the impact of COVID-19 limitations at the US PGM operations.

Management considered various scenarios that included the operational limitations in the United States as noted above, combined with:

• 42 day lockdown of mining operations in South Africa before returning to full mining activity;
• 21 day lockdown in South Africa, with the resumption of only Surface Operations for three months, before returning to full mining activity;
• 21 day lockdown in South Africa, with a resumption of operations with social distancing measures across all operations for three months before returning to full mining activity; and
• three month lockdown across all SA operations, alongside further reduced production output from the US operations before returning to full mining activity.

The scenario analysis included the following additional assumptions:

• average commodity prices for the remainder of the year: Gold ($1,600/oz), Palladium ($2,000/oz), Platinum ($750/oz) and Rhodium ($7,500/oz);
• average rand/ US dollar exchange rate for the remainder of the year: R18:US$1;
• production at SA operations modelled for a delayed ramp up to full production over two months subsequent to the lockdown period, based on experience from previous mine shut downs; and
• available liquidity at 31 March 2020 of R16.5 billion consisting of R0.2 billion committed undrawn debt, R1.7 billion of available uncommitted overnight facilities and R14.6 billion cash on hand.

While each of the scenarios result in a net utilisation of available liquidity, none of the scenarios result in an overall depletion of available liquidity. In each of the scenarios the Group expects to continue to meet its debt covenant requirements and remain liquid and solvent for at least a twelve month period after the date of approving these financial statements.

The Group has demonstrated its ability to proactively manage liquidity risk through various initiatives implemented during 2019. Improved geographical and commodity diversification, along with improved commodity prices, and increased operational scale should enable management to mitigate the impact of COVID-19, positioning the Group for a return to its targeted leverage ratio of 1:1. However, there are a number of uncertainties associated with COVID-19 that could have an adverse impact on the Group and its ability to comply with debt covenants and meet liquidity requirements. These uncertainties could include:

• turmoil in the world economy and the possible adverse impact over the short to medium term on the demand for PGMs and gold, commodity prices and rand/ US dollar exchange rates;
• possible further extension of the lockdown periods and/or delay in ramping up South African operations with an impact on production beyond the modeled scenarios described above;
• potential lockdown at the US PGM operations overlapping significantly with the lockdown at the South African operations;
• extended lockdown and delayed return to normal production by our suppliers and customers and the economies in which they operate;
• health and wellbeing of our employees after the extended lockdown; and
• financial market disruption and limited access to funding opportunities.

The adverse impact of the above uncertainties or a combination thereof could further deteriorate the Group's forecasted liquidity position and may require the Group to further increase operational flexibility by adjusting mine plans, reducing capital expenditure and/or selling assets. The Group may also, if necessary, be required to consider options to increase funding flexibility which may include, amongst others, additional loan facilities or debt capital market issuances, streaming facilities, prepayment facilities or, in the event that other options are not deemed preferable or achievable by the Board, an equity capital raise. The Group could also, with lender approval, request covenant amendments or restructure facilities. During past adversity management has successfully implemented similar actions. However, the impact of COVID-19 on the global economy is unprecedented and unclear, and implementation of these actions could be challenging during the depressed economic environment caused by COVID-19.

While management acknowledge that there are uncertainties in modelling the different scenarios attributable to the COVID-19 pandemic, management remain confident that the Group's liquidity needs can be satisfied under any of the probable scenarios. The consolidated financial statements for the year ended 31 December 2019, therefore, have been prepared on a going concern basis.

Sibanye-Stillwater Annual Financial Report 2019

27

MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL STATEMENTS continued

Off balance sheet arrangements and contractual commitments

At 31 December 2019, Sibanye-Stillwater had no off balance sheet items. For a description of Sibanye-Stillwater's contractual commitments, see the following notes to the consolidated financial statements:

Contractual commitments	Note to the consolidated financial statements
Environmental rehabilitation obligation	28	- Environmental rehabilitation obligation and other provisions
Occupational healthcare obligation	29	- Occupational healthcare obligation
Commercial commitments	35	- Commitments
Contingent liabilities	36	- Contingent liabilities
Debt
- capital	26	- Borrowings and derivative financial instrument
- interest	26	- Borrowings and derivative financial instrument
Leases	27	- Lease liabilities

These contractual commitments for expenditure will be met from internal cash flow and, to the extent necessary, from the existing facilities.

Critical accounting policies and estimates

Sibanye-Stillwater's significant accounting policies are fully described in the various notes to its consolidated financial statements. Some of Sibanye-Stillwater's accounting policies require the application of significant judgements and estimates by management that can affect the amounts reported in the consolidated financial statements.

These judgements and estimates are based on management's best knowledge of the relevant facts and circumstances, having regard to previous experience, but actual results may differ from the amounts included in the consolidated financial statements.

For Sibanye-Stillwater's significant accounting policies that are subject to significant judgements, estimates and assumptions, see the following notes to the consolidated financial statements:

Significant accounting policy	Note to the consolidated financial statements
Revenue	3 - Revenue
Royalties, mining and income tax, and deferred tax	9 - Royalties, mining and income tax, and deferred tax
Property, plant and equipment	12	- Property, plant and equipment
Business combinations	14	- Acquisitions
Goodwill	15	- Goodwill
Equity-accounted investments	16	- Equity accounted investments
Other receivables and other payables	20	- Other receivables and other payables
Inventories	21	- Inventories
Borrowings	26	- Borrowings and derivative financial instrument
Environmental rehabilitation obligation	28	- Environmental rehabilitation obligation and other provisions
Occupational healthcare obligation	29	- Occupational healthcare obligation
Deferred revenue	30	- Deferred revenue
Contingent liabilities	36	- Contingent liabilities

Sibanye-Stillwater Annual Financial Report 2019

28

STATEMENT OF RESPONSIBILITY BY THE BOARD OF DIRECTORS

The directors are responsible for the preparation and fair presentation of the consolidated annual financial statements of Sibanye-Stillwater, comprising the consolidated statement of financial position as at 31 December 2019, and consolidated income statement and consolidated statements of other comprehensive income, changes in equity and cash flows for the year then ended, and the notes to the consolidated financial statements, which include a summary of significant accounting policies, and other explanatory notes, in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB), the SAICA Financial Reporting Guides issued by the Accounting Practices Committee and Financial Reporting Pronouncements issued by the Financial Reporting Standards Council, as well as the requirements of the South African Companies Act, 71 of 2008 (the Companies Act) and the JSE Listings Requirements.

In addition, the directors are responsible for preparing the directors' report.

The directors consider that, in preparing the consolidated financial statements, they have used the most appropriate accounting policies, consistently applied and supported by reasonable and prudent judgements and estimates, and that all IFRS standards that they consider to be applicable have been complied with for the financial year ended 31 December 2019. The directors are satisfied that the information contained in the consolidated financial statements fairly presents the results of operations for the year and the financial position of the Group at year end. The directors are responsible for the information included in the annual financial report, and are responsible for both its accuracy and its consistency with the consolidated annual financial statements.

The directors have responsibility for ensuring that accounting records are kept. The accounting records should disclose with reasonable accuracy the financial position of the Group to enable the directors to ensure that the consolidated annual financial statements comply with the relevant legislation.

The Group operated in a well-established control environment, which is well documented and regularly reviewed. This incorporates risk management and internal control procedures, which are designed to provide reasonable assurance that assets are safeguarded and the material risks facing the business are being controlled.

The directors have made an assessment of the ability of the Company and its subsidiaries to continue as going concerns and based on this assessment concluded that the basis for preparation of the consolidated annual financial statements is appropriate to that of a going concern.

The Group's external auditors, Ernst & Young Inc. audited the consolidated annual financial statements. For their report, see- Independent Auditor's Report.

The consolidated annual financial statements were approved by the Board of Directors and are signed on its behalf by:

Neal Froneman

Chief Executive Officer

Charl Keyter

Chief Financial Officer

22 April 2020

COMPANY SECRETARY'S CONFIRMATION

In terms of section 88(2)(e) of the Companies Act, as amended, I certify that to the best of my knowledge, the Company has lodged with the Companies and Intellectual Property Commission all such returns as are required to be lodged by a public company in terms of the Companies Act, and that all such returns are true, correct and up to date.

Lerato Matlosa

Company Secretary

22 April 2020

Sibanye-Stillwater Annual Financial Report 2019

29

REPORT OF THE AUDIT COMMITTEE

Introduction

The Audit Committee has formal terms of reference which are updated on an annual basis. The Board is satisfied that the Audit Committee has complied with these terms, and with its legal and regulatory responsibilities as set out in the Companies Act, King IVTM, the JSE Listings Requirements and the requirements of the SEC.

The Audit Committee consisted of six independent non-executive directors for the period from 1 January 2019 to 31 December 2019. For membership, see -Accountability-Directors' report-Directorate-Compositionof the Board and sub-committees.

The Board believes that the members collectively possess the knowledge and experience to supervise Sibanye-Stillwater's financial management, internal and external auditors, the quality of Sibanye-Stillwater's financial controls, the preparation and evaluation of Sibanye- Stillwater's audited consolidated financial statements and Sibanye-Stillwater's periodic financial reporting.

The Board has established and maintains internal controls and procedures, which are reviewed on a regular basis. These are designed to manage the risk of business failures and to provide reasonable assurance against such failures. However, this is not a guarantee that such risks are eliminated.

Responsibility

It is the duty of the Audit Committee, inter alia, to monitor and review:

• the effectiveness of the internal audit function, see -Internal Audit (below);
• auditor suitability and recommendation for appointment, see -Auditor suitability review (below);
• auditor independence and fees, see -Auditor independence and fees (below);
• reports of both internal and external auditors;
• evaluation of the expertise and experience of the Chief Financial Officer (CFO);
• financial reporting systems and ensure that reporting procedures are functioning properly;
• the governance of information technology (IT) and the effectiveness of the Group's information systems;
• interim results and report, quarterly operating reports, company and consolidated annual financial statements and all other widely distributed financial documents;
• the Form 20-F filing with the SEC;
• accounting policies of the Group and proposed revisions;
• compliance with applicable legislation, requirements of appropriate regulatory authorities and Sibanye-Stillwater's Code of Ethics;
• the integrity of the integrated annual report and associated reports (by ensuring that its content is reliable and recommending it to the Board for approval); and
• policies and procedures for preventing and detecting fraud.

Access and meetings

Internal and external auditors have unrestricted access to the Audit Committee, the Audit Committee Chairman and the Chairman of the Board, ensuring that auditors are able to maintain their independence. Both the internal and external auditors report at Audit Committee meetings. The Audit Committee meets with both internal and external auditors separately on a quarterly basis without other invitees being present. Management attend Audit Committee meetings by invitation.

Annual financial statements

The Committee has reviewed and is satisfied that the consolidated annual financial statements ("Audited AFS"), including accounting policies, are appropriate and comply with IFRS, the JSE Limited Listings Requirements, the requirements of the Companies Act and the requirements of the SEC.

The significant audit and accounting matters considered by the Committee during the financial year were:

• the impairment assessment of property, plant and equipment, goodwill arising from business combinations, and equity-accounted investments;
• the Lonmin Plc. (Lonmin) acquisition and related purchase price accounting;
• the fair value of the derivative financial instrument embedded in the convertible bonds; and
• first year auditor transition.

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Matters that were addressed by management and by the Audit Committee on a review basis are as follows:

The impairment assessment of property, plant and equipment, and goodwill arising from business combinations, and equity- accounted investments

The Lonmin acquisition and related purchase price accounting

For the year ended 31 December 2019, management performed an impairment assessment over the property, plant and equipment, goodwill and equity-accounted investments as follows:

• assessed whether there is an indication, based on either internal or external sources of information, that an asset or cash-generating unit (CGU) may be impaired;
• assessed the recoverable amount of the assets, based on expected discounted net forecast cash flows arising from the expected mining of the ore reserves;
• calculated the recoverable amount for each CGU using a discounted cash flow model; and
• considered the excess of recoverable amount over the carrying value for each CGU.

Management impaired goodwill of R54.3 million attributed to the Qinisele Resources Proprietary Limited (Qinisele) acquisition. The goodwill relates to the experience and skills of the Qinisele workforce that could not be allocated to any of Sibanye-Stillwater Group's current operating CGU's.

For the year ended 31 December 2019, management prepared a provisional purchase price allocation of the Lonmin acquisition as follows:

• engaged an external valuation expert to determine the fair value of the property, plant and equipment based on the expected discounted net cash flows arising from the expected mining of the ore reserves; and
• determined the fair value of the remaining assets acquired and liabilities assumed using appropriate valuation techniques.

Management recognised a gain on acquisition of R1,103 million, attributable to the transaction being attractively priced.

Fair value of derivative financial instrument embedded in the convertible bonds

First year audit transition

For the year ended 31 December 2019, management determined the fair value of the derivative financial instrument embedded in the convertible bonds as follows:

• engaged an external valuation expert ("expert");
• the expert determined the fair value of the derivative financial instrument; and
• assessed the reasonability of key assumptions and inputs used by the expert. Management recognised a loss on financial instrument of R3,912 million.

For the year ended 31 December 2019, Sibanye-Stillwater transitioned to Ernst & Young Inc. as its external auditor. The Audit Committee is satisfied that Ernst & Young Inc. determined the appropriateness of corresponding amounts and the account balances at the beginning of the period; obtained an understanding of the accounting policies applied by the Sibanye-Stillwater Group; and acquired an understanding of the specific risks, controls, policies and processes within the Sibanye-Stillwater Group that enabled the determination and execution of an appropriate audit approach.

Auditor suitability review

In terms of section 90(1) of the Companies Act, each year at its annual general meeting (AGM), the Company must appoint an external audit firm and designated individual partner that complies with the requirements of section 90(2) of the Companies Act and with the JSE Listings Requirements.

The Board delegated to the Audit Committee the responsibility to review the Company's current appointed audit firm and designated individual audit partner for re-appointment. The Board would then make a recommendation to the shareholders in the notice of AGM, based on the outcome of the review and report of the Audit Committee to the Board.

Accordingly, in compliance with paragraph 3.84(g)(iii) of the JSE Listings Requirements, the Audit Committee assessed the suitability for reappointment of the current appointed audit firm, being Ernst & Young Inc., and the designated individual partner, being Lance Ian Neame Tomlinson (Auditor Suitability Review).

The Auditor Suitability Review performed by the Audit Committee included an examination and review of:

• the results of the most recent Independent Regulatory Board of Auditors (IRBA) inspection of Ernst & Young Inc. (ISQC 1 Inspection), including the responses of the firm on observations raised;
• the results of the most recent IRBA inspection of the designated individual auditor;
• A summary of the audit firms ISQC 1 internal inspection process and the process to analyse and conclude on the results of the internal inspection;
• A summary of the outcome of the designated individual auditor's latest internal quality review;
• the results of the most recent Public Company Accounting Oversight Board (PCAOB) inspection review of Ernst & Young Inc.; and

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REPORT OF THE AUDIT COMMITTEE continued

• a summary and results of all legal and disciplinary proceedings concluded within the past seven years, which were instituted in terms of any legislation or by any professional body of which the audit firm and/or designated individual auditor are a member or regulator to whom they are accountable, including where the matter is settled by consent order or payment of a fine.

The Audit Committee has satisfied itself that both Ernst & Young Inc. and Lance Ian Neame Tomlinson are accredited in terms of the JSE Listings Requirements. Based on the results of the Auditor Suitability Review and a review of the independence of Ernst & Young Inc. and the designated individual audit partner, the Audit Committee recommended to the Board that Ernst & Young Inc. be re-appointed as the auditors of the Company and that Lance Ian Neame Tomlinson be reappointed as the designated individual partner. The Board concurred with the recommendation.

Auditor independence and fees

The Audit Committee is also responsible for determining that the external audit firm and designated individual audit partner have the necessary independence, experience, qualifications and skills, and that audit and other fees are reviewed and approved.

The Audit Committee has reviewed and assessed the independence of the external auditor, and has confirmed in writing that the criteria for independence, as set out in the rules of the Independent Regulatory Board for Auditors, the Public Company Accounting Oversight Board, and other relevant international bodies, have been followed. The Audit Committee is satisfied that Ernst & Young Inc. is independent of the Group. The following aggregate audit fees, audit-related fees, tax fees and all other fees were approved by the Audit Committee and billed by the external auditors for 2019 (Ernst & Young Inc.), 2018 (KPMG Inc.) and 2017 (KPMG Inc.) as follows:

Figures in million - SA rand	2019	2018	2017
Audit fees1	53.7	39.7	40.1
Audit-related fees2	1.0	5.2	7.1
Tax fees3	0.2	1.0	1.6
All other fees4	0.0	0.3	11.4
Total	54.9	46.2	60.2

1. Audit fees consist of the aggregate fees billed for the annual audit of Sibanye-Stillwater's consolidated financial statements, audit of the Group's internal controls over financial reporting in accordance with section 404 of the Sarbanes-Oxley Act and the audit of statutory financial statements of the Company's subsidiaries, including fees billed for assurance and related services that are reasonably related to the performance of the audit or reviews of the Company's financial statements that are services that only an external auditor can reasonably provide
2. Audit-relatedfees consist of the aggregate fees billed in each fiscal year for review of documents filed with regulatory authorities, consultations concerning financial accounting and reporting standards, review of security controls and operational effectiveness of systems, and due diligence related to acquisitions
3. Tax fees include the aggregate fees billed in each fiscal year for tax compliance, tax advice, tax planning and other tax-related services
4. All other fees consist of the aggregate fees billed in each fiscal year for all other services not included under audit fees, audit related fees or tax fees

The Audit Committee determines the nature and extent of non-audit services that the firm can provide and pre-approves all permitted non-audit assignments by the Group's independent external auditor. In accordance with the SEC rules regarding auditor independence, the Audit Committee has established policies and procedures for audit and non-audit services provided by an independent auditor. The rules apply to Sibanye-Stillwater and its legally controlled subsidiaries engaging any accounting firms for audit services and the auditor who audits the accounts filed with the SEC (the external auditor) for permissible non-audit services. When engaging the external auditor for permissible non-audit services (audit related services, tax services, and all other services), pre-approval is obtained prior to the commencement of the services.

The Audit Committee approves the annual audit plan presented by the internal and external auditors and monitors progress against the plan. These audit plans provide the Audit Committee with the necessary assurance on risk management, internal control environments and IT governance.

Internal Audit

The internal control systems of the Group are monitored by Internal Audit, which reports findings and recommendations to the Audit Committee and to senior management. The Audit Committee determines the purpose, authority and responsibility of the Internal Audit function in an Internal Audit Charter. The Internal Audit function is headed by the Vice President: Internal Audit, who may be appointed or dismissed by the Audit Committee. The Audit Committee is satisfied that the incumbent Vice President: Internal Audit has the requisite skills and experience and that she is supported by a sufficient staff complement with appropriate skills and training.

Sibanye-Stillwater's Internal Audit operates in accordance with the International Standards for the Professional Practice of Internal Auditing as prescribed by the Institute of Internal Auditors. Internal Audit activities carried out during the year were identified and planned through a combination of the Sibanye-Stillwater Risk Management framework and the risk-based methodologies adopted by Internal Audit. The Audit Committee approves the annual internal audit assurance plan presented by Internal Audit and monitors progress against the plan.

Internal Audit reports deficiencies to the Audit Committee every quarter together with recommended remedial actions, which are then followed up. Internal Audit provided the Audit Committee with a written report, which assessed as adequate the internal controls over financial reporting, IT governance and the risk management process during 2019.

The Audit Committee is responsible for IT governance on behalf of the Board and reviews the report of the Vice President: Group ICT at each Audit Committee meeting.

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JSE Limited Listings Requirements

In accordance with the JSE Limited Listings Requirements, the Audit Committee reports and confirms that it has:

• evaluated the expertise, experience and performance of the Company and Group CFO during 2019 and is satisfied that he has the appropriate expertise and experience to carry out his duties, and is supported by qualified and competent senior staff;
• ensured that the Company and Group has established appropriate financial reporting procedures and that those procedures are operating, this included consideration of all entities consolidated into the group financial statements, ensuring that management had access to all the required financial information to allow the effective preparation and report on the group financial statements of the Company;
• evaluated the skills and experience of the Vice President: Internal Audit and is satisfied that she has the appropriate skills and experience to carry out her duties, and is supported by a sufficient staff complement with appropriate skills and training; and
• has performed the Auditor Suitability Review of both the current appointed external audit firm and designated individual partner as detailed above and ensured that the appointment of the auditor is presented and included as a resolution at the annual general meeting.

Audit Committee statement

Based on information from, and discussions with, management and external auditors, the Audit Committee is of the opinion that the financial records may be relied upon as the basis for preparation of the audited consolidated annual financial statements.

With respect to the financial year ended 31 December 2019, a material weakness was identified in that the company did not conduct an effective identification, selection and development of control activities by the central treasury function to mitigate risk in respect of the timely recognition of foreign currency cash receipts as cash and cash equivalents with corresponding settlement of trade receivables. The control deficiency did not result in any misstatements to cash and cash equivalents and the corresponding trade receivables in these consolidated financial statements, as the misstatement was adjusted in the consolidated financial statements as at 31 December 2019. Management strives to continuously improve the diligence in the identification and documentation of key controls. Management is in the process of remediating the control deficiency.

The Audit Committee has considered and discussed the Audited AFS and associated reports with both management and the external auditors. During this process, the Audit Committee:

• evaluated significant judgements and reporting decisions;
• determined that the going-concern basis of reporting is appropriate;
• evaluated the material factors and risks that could impact on the annual financial report and associated reports;
• evaluated the completeness of the financial and sustainability discussion and disclosures; and
• discussed the treatment of significant and unusual transactions with management and the external auditors.

The Audit Committee considers that the Audited AFS comply in all material respects with the statutory requirements of the various laws and regulations governing disclosure and reporting of the Audited AFS and that the Audited AFS comply in all material respects with IFRS, as issued by the IASB, the SAICA Financial Reporting Guides issued by the Accounting Practices Committee and Financial Reporting Pronouncements issued by the Financial Reporting Standards Council, as well as the requirements of the South African Companies Act and the JSE Listings Requirements. The Audit Committee has recommended to the Board that the Audited AFS be adopted and approved by the Board.

Keith Rayner CA(SA)

Chairman: Audit Committee

22 April 2020

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DIRECTORS' REPORT

The directors have pleasure in submitting this report and the consolidated annual financial statements of Sibanye-Stillwater for the year ended 31 December 2019.

Group profile and location of our operations

Sibanye-Stillwater, an independent, global, precious metals mining company, produces a mix of metals that includes PGMs and gold. Domiciled and with its head office in South Africa, Sibanye-Stillwater owns and operates a portfolio of high-quality operations and projects that are located as follows:

• US PGM operations: The East Boulder and the Stillwater (including Blitz) mines are located in Montana, in the United States. The Columbus Metallurgical Complex, which smelts the material mined to produce PGM-rich filter cake, also conducts PGM recycling activities.
• SA PGM operations: The Kroondal, Rustenburg, Platinum Mile and Marikana operations are located on the western limb of the Bushveld Complex in South Africa, while Mimosa is on the southern portion of the Great Dyke in Zimbabwe. Platinum Mile is a retreatment facility. The Marikana operations produces PGM metals and also performs toll processing at its precious metal refinery.
• SA gold operations: In South Africa, Driefontein, Kloof and Cooke surface operations are located on the West Rand of the Witwatersrand Basin, while Beatrix is in the southern Free State goldfields of the Basin. Sibanye-Stillwater also has an interest in surface tailings retreatment facilities located from the East Rand to the West Rand through our 38.05% stake in DRDGOLD which was increased to 50.10% on 10 January 2020.

Financial affairs

Results for the year

The Group profit was R433 million in 2019 compared with a loss of R2,521 million in 2018. The major source of earnings for 2019 was the SA PGM operations, which accounted for approximately 59% of Group adjusted EBITDA in 2019 with the inclusion of the Marikana operations for seven months since acquisition that contributed 16% to the Group adjusted EBITDA. The contribution from the US PGM operations has also increased by 76% contributing 49% of Group adjusted EBITDA, mainly due to a higher average 2E basket price received which increased by 39% to US$1,403/2Eoz. The contribution from SA PGM operations has increased substantially due to both a higher average 4E basket price received, which increased by 44% to R19,994/4Eoz, and the contribution to Group adjusted EBITDA from the Marikana operations of R2,448 million. Despite a higher average rand gold price received year-on-year, the impact of the strike that ended in April 2019, caused production from the SA gold operations to decrease by 7,591kg (244,057oz), resulting in adjusted EBITDA from the SA gold operations declining by 171% to a negative R969 million. For a review of Sibanye-Stillwater's financial performance for 2019, see -Overview-Management'sdiscussion and analysis of the financial statements.

Dividends

Sibanye-Stillwater's dividend policy is to return at least 25% to 35% of normalised earnings to shareholders and after due consideration of future requirements the dividend may be increased beyond these levels. The Board, therefore, considers normalised earnings in determining what value will be distributed to shareholders. The Board believes normalised earnings provides useful information to investors regarding the extent to which results of operations may affect shareholder returns. Normalised earnings is defined as earnings attributable to the owners of Sibanye-Stillwater excluding gains and losses on financial instruments and foreign exchange differences, impairments, gain on disposal of property, plant and equipment, occupational healthcare expense, restructuring costs, transactions costs, share-based payment on BEE transaction, gain on acquisition, other business development costs, share of results of equity-accounted investees, after tax, and changes in estimated deferred tax rate.

In line with Sibanye-Stillwater's strategic priority of deleveraging, the Board of Directors resolved not to pay a final dividend. Sibanye-Stillwater expects to resume dividend payments in H1 2020, based on the current deleveraging trajectory and subject to current commodity prices.

Borrowing powers

In terms of Clause 4 of the Company's Memorandum of Incorporation, the borrowing powers of the Sibanye Gold Limited (the Company) are unlimited. As at 31 December 2019, the borrowings of the Company and the Group, excluding the Burnstone Debt and including the derivative financial instrument, was R10,824 million (2018: R11,327 million) and R26,551 million (2018: R23,769 million), respectively, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note26: Borrowings and derivative financial instrument.

Sibanye-Stillwater is subject to financial and other covenants and restrictions under its credit facilities from time to time. Such covenants may include restrictions on Sibanye-Stillwater incurring additional financial indebtedness and obligations to maintain certain financial covenant ratios for as long as any amount is outstanding under such facilities.

Events after reporting date

There were no events that could have a material impact on the financial results of the Group after 31 December 2019, other than those disclosed in the consolidated financial statements, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note38: Events after reporting date.

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Working capital and going concern assessment

The consolidated financial statements have been prepared using appropriate accounting policies, supported by reasonable judgements and estimates. The directors believe that the Group has adequate resources to continue as a going concern for the foreseeable future.

The directors believe that the cash generated by its operations, cash on hand, the committed unutilised debt facilities as well as additional funding opportunities will enable the Group to continue to meet its obligations as they fall due. The consolidated financial statements for the year ended

31 December 2019, therefore, have been prepared on a going concern basis, see -Consolidatedfinancial statements-Notesto the consolidated

financial statements-Note 34.2: Risk management activities-Liquidityrisk-Working capital and going concern assessment.

Significant announcements

Results of share placing - 10 April 2019

On 9 April 2019, Sibanye-Stillwater announced its intention to conduct a non pre-emptive cash placing of new ordinary no par value shares in the authorized but unissued share capital of the Company to certain institutional investors (the "Placing"), of up to 108,932,356 shares, which represents approximately 5 per cent of the Company's existing issued ordinary share capital base which is the maximum authorised issuance under current authorities.

On 10 April 2019, Sibanye-Stillwater announced successful completion of the Placing. A total of 108,932,356 new ordinary no par value shares in the authorized share capital of Sibanye-Stillwater had been placed with existing and new institutional investors at a price of R15.50 per share, raising gross proceeds of approximately ZAR1.7 billion/US$120 million.

Sibanye-Stillwater enhances liquidity by entering into a US$125 million Gold prepayment arrangement - 11 April 2019

On 11 April 2019, Sibanye-Stillwater announced that it has further enhanced its liquidity position by concluding a forward gold sale arrangement with Citibank whereby the Company has received a cash prepayment of US$125 million (approximately R1.75 billion) in exchange for the future delivery of 105,906 ounces (3,294 kilograms) of gold during Q4 2019, subject to a floor price of US$1,200 per ounce and a cap price of US$1,323 per ounce. Sibanye-Stillwater settled this arrangement with the final delivery on 14 November 2019.

Sibanye-Stillwater and AMCU conclude gold strike - 17 April 2019

On 17 April 2019, Sibanye-Stillwater reported that the five month strike by the Association of Mineworkers and Construction Union (AMCU) at its SA gold operations, has been resolved. As part of the agreement reached with Sibanye-Stillwater, AMCU has committed to signing the 2018 three-year wage agreement previously signed with National Union of Mineworkers (the NUM), Solidarity and UASA in respect of wages and conditions of service for the period 1 July 2018 to 30 June 2021. Sibanye-Stillwater has agreed to, inter alia:

• an ex gratia payment of R4,000 for all employees at its gold operations in the form of cash or a voucher, to alleviate hardship
• offer a cash advance of R5,000 upon request of the employees which will be repayable over a 12 month period
• assistance with debt consolidation and counselling as part of the existing 'Care for iMali' program
• waive its rights to reclaim costs incurred on behalf of employees during the strike including contributions to medical aid and pension/provident funds, accommodation and feeding costs
• provide transport for employees to return to work
• any employees who were dismissed for strike related misconduct will be subject to normal disciplinary proceedings in line with the Company's disciplinarily code and procedures which include the right to lodge a complaint in line with the formal grievance procedures

Resignation of Group Chairman, Mr Sello Moloko and appointment of Dr Vincent Maphai - 29 May 2019

On 29 May 2019, Sibanye-Stillwater announced, in accordance with Section 3.59 of the JSE Limited Listings Requirements, the Board of advised that the current Board Chairman, Mr Sello Moloko has tendered his resignation, effective 30 September 2019, in order to focus on his other responsibilities and the ongoing development of the Thesele Group, which he founded in 2005. Mr Moloko has served as Chairman of the Group since it was established in February 2013 and has overseen the growth and development of the Group, from a South African gold producer, into a leading international precious metals company and the Board would like to thank him for his sage counsel and guidance during this transformative period in the Company's history.

The Board was also pleased to announce the appointment of Dr Vincent Maphai, who succeeded Mr Moloko as Chairman and Non-executive Independent director, and joined the Board as Chairman designate effective from 1 June 2019. Dr Maphai's appointment followed an extensive search process and allowed for a suitable handover period in order to ensure continuity. The Board would like to congratulate and welcome Dr Maphai and looks forward to his valuable contribution to the ongoing development of Sibanye-Stillwater.

Sibanye-Stillwater acquisition of Lonmin - 7 June 2019

On 14 December 2017, Sibanye-Stillwater announced that it had reached an agreement with Lonmin Plc (Lonmin) on the terms of a recommended all-share offer to acquire the entire issued and to be issued ordinary share capital of Lonmin (the Lonmin Acquisition). The Lonmin Acquisition was effected by means of a scheme of arrangement between Lonmin and the Lonmin shareholders under Part 26 of the UK

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Companies Act. Under the initial terms of the Lonmin Acquisition, each Lonmin shareholder was entitled to receive: 0.967 new Sibanye-Stillwater shares for each Lonmin share (Initial offer).

On 25 April 2019, the boards of Sibanye-Stillwater and Lonmin reached agreement on the terms of an increased recommended all-share offer pursuant to which Sibanye-Stillwater, and/or a wholly owned subsidiary of Sibanye-Stillwater, was to acquire the entire issued and to be issued ordinary share capital of Lonmin (the Increased Offer). Under the terms of the Increased Offer, Lonmin shareholders was entitled to receive one new Sibanye-Stillwater share for each Lonmin share.

On 7 June 2019, Sibanye-Stillwater noted Lonmin's announcement made on 7 June 2019, that the Scheme implementing the acquisition of Lonmin plc has become Effective in accordance with its terms. Accordingly, the entire issued and to be issued ordinary share capital of Lonmin is now owned by Sibanye-Stillwater and all non-executive directors of Lonmin have tendered their resignations with effect from the Effective Time of the Scheme. Lonmin Shareholders swapped one Lonmin Share held for one New Sibanye-Stillwater Share and the total number of ordinary no par value shares issued was 290,394,531. For additional information on the Lonmin acquisition -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note14.1: Lonmin acquisition.

Sibanye-Stillwater enters into a strategic acquisition agreement with Generation Mining to further its Marathon project - 26 June 2019

On 26 June 2019, Sibanye-Stillwater advised that it has entered into an acquisition agreement with Generation Mining Limited (Gen Mining) to further the development of the PGM-copper Marathon project, situated in northern Ontario, Canada, adjacent to Lake Superior. The Marathon project was acquired by Sibanye-Stillwater as part of the Stillwater acquisition in May 2017.

The agreement sees Sibanye-Stillwater receive upfront proceeds in the form of 3.0 million Canadian dollars (CAD$) in cash and 11,053,795 shares @ CAD$0.2714 per share in Gen Mining (an equity interest of 12.9% @ CAD$0.2714 per share) on closing of the agreement. Gen Mining will acquire a 51% interest in the Marathon project and form an unincorporated joint venture with Stillwater Canada Inc.

The agreement will enable Gen Mining, a focused exploration company, to advance the Marathon project and to conclude further economic studies in the development of this asset.

Delaware Court of Chancery rules in favour of Sibanye-Stillwater in dissenting shareholder - 23 August 2019

On 23 August 2019, Sibanye-Stillwater advised that the Court of Chancery of the State of Delaware in the United States of America, in a Memorandum Opinion dated August 21, 2019, has ruled in favour of the Company in the appraisal action brought by a group of minority shareholders of the Stillwater Mining Company (Stillwater), following the acquisition of Stillwater by the Company in May 2017 for a cash consideration of US$18 per Stillwater share.

In terms of the ruling, the Dissenting shareholders (together owning approximately 4.5% of Stillwater shares outstanding at the time) will receive the same US$18 per share consideration originally offered to, and accepted by other Stillwater shareholders, plus interest. The remaining payment of approximately US$21 million due to the Dissenting shareholders has been fully provided for by Sibanye-Stillwater and therefore no adjustment to the provision is required.

These Court proceedings are thus concluded, subject to any further proceedings required in the trial court to finalize a judgment and any appeals that may be lodged. Certain of the Dissenting Shareholders have filed an appeal with the Supreme Court of the State of Delaware with the date for the oral argument, originally set for 1 April 2020, postponed until further notice in light of COVID-19.

Sibanye-Stillwater trading as Sibanye Gold Limited commences internal restructuring process, creating a new holding company and listings for the Group - 4 October 2019

On 4 October 2019 Sibanye Gold Limited (trading as Sibanye-Stillwater) and Sibanye Stillwater Limited announced the intention to implement a scheme of arrangement to reorganise Sibanye Gold Limited's operations under a new parent company, Sibanye Stillwater Limited (the "Scheme"). Under the Scheme, Sibanye Stillwater Limited will acquire Sibanye Gold Limited and its controlled entities. On 23 January 2020 Sibanye Gold Limited and Sibanye Stillwater Limited announced that all resolutions for the approval of the Scheme, were passed by the requisite majority voters at the Scheme Meeting held at the Sibanye Gold Limited Academy. The Scheme was implemented on 24 February 2020. For additional information on the key terms of the facility agreement, see -Consolidatedfinancial statements-Notesto the consolidated financial statements- Note 38: Events after reporting date.

Sibanye-Stillwater successfully refinances its Rand Revolving Credit Facility - 25 October 2019

On 25 October 2019, Sibanye-Stillwater announced that it has successfully refinanced its existing R6 billion Revolving Credit Facility maturing on 15 November 2019 with a new 3-year R5.5 billion Revolving Credit Facility (New ZAR RCF) on similar terms. The New ZAR RCF has an initial facility value of R5.5 billion and includes a R2 billion accordion option which allows for a future upsize to R7.5 billion, while the three-year tenor can be extended by two further one-year extensions.

For additional information on the key terms of the facility agreement, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note26.3: R5.5 billion RCF.

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Sibanye-Stillwater signs three-year PGM wage agreements - 15 November 2019

On 15 November 2019, Sibanye-Stillwater announced that it has concluded three-year wage agreements for its Rustenburg and Marikana operations which comprise part of the SA Platinum Group Metals operations. The wage agreements were signed with the representative unions - the Association of Mineworkers and Construction Union (AMCU) at the Marikana operation and AMCU and UASA (formerly known as United Association of South Africa) at the Rustenburg operation, in respect of wages and conditions of service for the period 1 July 2019 to 30 June 2022.

The agreement allows for increases to the basic wage of Category 4-9 surface and underground employees for both the Marikana and Rustenburg operations of R1 000 per month or 5% whichever is the higher in the first year, R1 000 per month or 5% whichever is the higher in the second year and R1 000 per month or 5% whichever is the higher in the third year. The pensionable base pay will increase by 3.5% for the Marikana operation over each of the next three years while the Rustenburg pensionable base pay and allowance base will increase by 5% over each of the next three years. Miners, artisans and officials will receive an increase of R1000 per month or 5% whichever is the higher per year for the three years.

Directorate

Following the scheme of arrangement to reorganise Sibanye Gold Limited's operations under a new parent, Sibanye Stillwater Limited, the Sibanye Gold Limited's directors in office on 24 February 2020 were appointed to the board of Sibanye Stillwater Limited.

Name	Position	Date appointed	Date resigned
Vincent Maphai1,4	Chairman and independent non-executive director	1	June 2019	6 April 2020
Sello Moloko3	Chairman and independent non-executive director	1	January 2013	30 September 2019
Neal Froneman1	Chief Executive Officer	1	January 2013	6 April 2020
Charl Keyter1	Chief Financial Officer	9	November 2012	6 April 2020
Tim Cumming1	Independent non-executive director	21	February 2013	6 April 2020
Savannah Danson1	Independent non-executive director	23	May 2017	6 April 2020
Barry Davison5	Independent non-executive director	21	February 2013	28 May 2019
Harry Kenyon-Slaney1	Independent non-executive director	16	January 2019	6 April 2020
Rick Menell1	Independent non-executive director	1	January 2013	6 April 2020
Nkosemntu Nika1	Independent non-executive director	21	February 2013	6 April 2020
Keith Rayner1	Independent non-executive director	1	January 2013	6 April 2020
Sue van der Merwe1	Independent non-executive director	21	February 2013	6 April 2020
Jerry Vilakazi1	Independent non-executive director	1	January 2013	6 April 2020
Shadwick Bessit6	Non-independent executive director	6	April 2020
Pieter Henning6	Non-independent executive director	6	April 2020
Dawie Mostert6	Non-independent executive director	6	April 2020
Wayne Robinson6	Non-independent executive director	6	April 2020
Wang Bin2	Non-independentnon-executive director	1	January 2020	6 April 2020
Lu Jiongjie2	Non-independentnon-executive director	1	January 2020	6 April 2020

1. Director resigned from the board of Sibanye Gold Limited on 6 April 2020 after being appointed to the board of Sibanye Stillwater Limited on 24 February 2020
2. Messrs Wang Bin and Lu Jiongjie have been appointed as Non-Independent,Non-Executive Directors to the Company's Board with effect from 1 January 2020. They resigned on 6 April 2020
3. Sello Moloko has tendered his resignation, effective 30 September 2019, in order to focus on his other responsibilities and the ongoing development of the Thesele Group, which he founded in 2005
4. Vincent Maphai has taken over from Sello Moloko as Chairman designate, effective from 1 June 2019
5. Barry Davison resigned as an Independent non-executive director at the AGM held on 28 May 2019
6. Messrs Bessit, Henning, Mostert and Robinson have been appointed as Non-Independent, Executive Directors to the board of Sibanye Gold Limited with effect from 6 April 2020

Directors' and officers disclosure of interest in contracts

As of the date of this report, none of the directors, officers or major shareholders of Sibanye-Stillwater or, to the knowledge of Sibanye-Stillwater's management, their families, had any interest, direct or indirect, in any transaction during the last fiscal year or in any proposed transaction which has affected or will materially affect Sibanye-Stillwater or its investment interests or subsidiaries. None of the directors or officers of Sibanye- Stillwater or any associate of such director or officer is currently or has been at any time during the past fiscal year materially indebted to Sibanye- Stillwater.

For related party information, see -Consolidated financial statements-Notes to the consolidated financial statements-Note 37: Related-party transactions.

Subsidiary companies

For details of major subsidiary companies in which the Company has a direct or indirect interest, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note1.3: Consolidation.

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Special resolutions passed by subsidiary companies

The following special resolutions were passed by subsidiary companies during the year ended 31 December 2019:

Special resolution passed by a subsidiary company

Special resolution passed by the shareholders of the subsidiary companies listed below, approving that the directors of the company may at any time and from time to time during the two years from the passing hereof authorise the company, in terms of and subject to the provisions of section 45(3)(b) of the Companies Act, to provide any type of direct or indirect financial assistance as defined in section 45(1) of the Companies Act, to any company or corporation that is related or inter-related to the company, on such terms and conditions and for such amounts as the directors may determine.

• Bushbuck Ventures Proprietary Limited;
• Oryx Ventures Proprietary Limited;
• Western Platinum Proprietary Limited; and
• Eastern Platinum Proprietary Limited;

Special resolutions passed by various subsidiaries

Special resolutions passed by the sole shareholder of the subsidiary companies listed below, approving that the directors of the company may at any time and from time to time during the two years from the passing hereof authorise the company in terms of and subject to the provisions of section 45(3)(b) of the Companies Act, to provide any type of direct or indirect financial assistance as defined in section 45(1) of the Companies Act, to any company or corporation that is related or inter-related to the company, on such terms and conditions and for such amounts as the directors may determine.

• Ezulwini Mining Company Proprietary Limited;
• K2013164354 Proprietary Limited;
• Kroondal Operations Pty Ltd
• M Janse van Rensburg Proprietary Limited;
• Milen Mining Proprietary Limited;
• Puma Gold Proprietary Limited;
• Rand Uranium Proprietary Limited;
• Sibanye Gold Academy Proprietary Limited;
• Sibanye Gold Eastern Operations Proprietary Limited;
• Sibanye Gold Protection Services Limited;
• Sibanye Gold Shared Services Proprietary Limited;
• Sibanye Rustenburg Platinum Mines Pty Ltd
• Sibanye Solar PV Proprietary Limited;
• Sibanye Stillwater Limited;
• Sibanye Uranium Proprietary Limited;
• St Helena Hospital Proprietary Limited;
• Witwatersrand Consolidated Gold Resources Proprietary Limited; and
• Witwatersrand Deep Investments Proprietary Limited.

Litigation

Occupational healthcare obligation

On 3 May 2018, the Occupational Lung Disease Working Group (the Working Group), including the Sibanye-Stillwater Group, agreed to an approximately R5 billion class action settlement with the claimants. The estimated costs were reviewed at 31 December 2018 and discounted using a risk-free rate.

On 26 July 2019 the Gauteng High Court in Johannesburg approved the R5 billion settlement agreement in the silicosis class case. This settlement agreement provides compensation to all eligible workers suffering from silicosis and/or tuberculosis who worked in the Occupational Lung Disease Working Group companies' mines from 12 March 1965 to the date of the settlement agreement. Sibanye-Stillwater currently has provided R1,282.1 million for its share of the settlement cost. The provision is consequently subject to adjustment in the future based on the number of eligible workers.

On 19 December 2019 Sibanye Stillwater provided a guarantee for an amount not exceeding R1,372 million in respect of trust administration contributions, initial benefit contributions and benefit contributions as required by the Trust Deed.

Sibanye-Stillwater Annual Financial Report 2019

38

DIRECTORS' REPORT continued

For additional information of occupational healthcare obligation recognised, see -Consolidatedfinancial statements-Notesto the consolidated financial statements-Note29: Occupational healthcare obligation.

Purported Class Action Lawsuits

In 2018, two groups of plaintiffs filed purported class action lawsuits, subsequently consolidated into a single action (Class Action), against Sibanye Gold Limited (Sibanye-Stillwater) and Neal Froneman (collectively, the Defendants) in the United States District Court for the Eastern District of New York, alleging violations of the US securities laws. Specifically, the Class Action alleges that the Defendants made false and/or misleading statements about its safety practices and record and thereby violated the US securities laws. The Class Action seeks an unspecific amount of damages. The Defendants have filed a motion to dismiss the Class Action. The Court may decide the motion to dismiss with or without oral argument. As the case is still in the early stages, it is not possible to determine the likelihood of success on the merits or any potential liability from the Class Action nor estimate the duration of the litigation. Sibanye-Stillwater intends to defend the case vigorously.

Delaware Court of Chancery rules in favour of Sibanye-Stillwater in dissenting shareholder action

The Court of Chancery of the State of Delaware in the United States of America (the Court), in a Memorandum Opinion dated 21 August 2019, has ruled in favour of the Company in the appraisal action brought by a group of minority shareholders (the Dissenting Shareholders) of the Stillwater Mining Company (Stillwater), following the acquisition of Stillwater by the Company in May 2017 for a cash consideration of US$18 per Stillwater share.

In terms of the ruling, the Dissenting Shareholders (together owning approximately 4.5% of Stillwater shares outstanding at the time) received the same US$18 per share consideration originally offered to, and accepted by other Stillwater shareholders, plus interest. The remaining payment of approximately US$21 million due to the Dissenting Shareholders has been paid by Sibanye-Stillwater during the six months ended 31 December 2019.

Certain of the Dissenting Shareholders have filed an appeal with the Supreme Court of the State of Delaware with the date for the oral argument, originally set for 1 April 2020, postponed until further notice in light of COVID-19.

COMPANY SECRETARY

Lerato Matlosa was appointed Company Secretary of Sibanye-Stillwater with effect from 1 June 2018.

AUDITORS

The Audit Committee has recommended to the Board that Ernst & Young Inc. continues in office in accordance with section 90(1) of the Companies Act and in terms of the JSE Listings Requirements, subject to shareholders approving the resolution at the next annual general meeting.

Sibanye-Stillwater Annual Financial Report 2019

39

EY	Ernst & Young Incorporated
102 Rivonia Road	Co Reg. No. 2005/002308/21
Sandton	Tel: [phone]
Private Bag X14 Sandton	Fax: [phone]
2146	Docex 123 Randburg
	ey.com

Independent Auditor's Report

To the Shareholders of Sibanye Stillwater Limited as successor entity to Sibanye Gold Limited, trading as Sibanye- Stillwater

Report on the Audit of the Consolidated Financial Statements

Opinion

We have audited the consolidated financial statements of Sibanye Gold Limited, trading as Sibanye- Stillwater and its subsidiaries (the Group) set out on pages 46 to 122 , which comprise the consolidated statement of financial position as at 31 December 2019, and the consolidated income statement, the consolidated statement of other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the group as at 31 December 2019, and its consolidated financial performance and consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, and the requirements of the Companies Act of South Africa.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the consolidated financial statements section of our report. We are independent of the group in accordance with the sections 290 and 291 of the Independent Regulatory Board for Auditors' Code of Professional Conduct for Registered Auditors (Revised January 2018), parts 1 and 3 of the Independent Regulatory Board for Auditors' Code of Professional Conduct for Registered Auditors (Revised November 2018) (together the IRBA Codes) and other independence requirements applicable to performing audits of financial statements of the group and in South Africa. We have fulfilled our other ethical responsibilities, as applicable, in accordance with the IRBA Codes and in accordance with other ethical requirements applicable to performing audits of the group and in South Africa. The IRBA Codes are consistent with the corresponding sections of the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants (IESBA code) and the International Ethics Standards Board for Accountants' International Code of Ethics for Professional Accountants (including International Independence Standards) respectively. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditor's responsibilities for the audit of the financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial statements.

40

A member firm of Ernst & Young Global Limited

Key Audit Matter	How the matter was addressed in the audit
Accounting for acquisition of Lonmin Plc
As more fully described in Note 14 to the consolidated financial	•	We obtained an understanding, evaluated the design
	and tested the operating effectiveness of controls
statements, Lonmin Plc was acquired on 7 June 2019 for a total		over the Company's accounting for the business
consideration of R4,306.6 million, settled in the Company's		combination process. For example, we tested
shares. The fair value of net identifiable assets acquired		controls over management's review of the valuation
amounted to R5,656.6 million. Net of non-controlling interests,		models, including the identification of significant
the Company recorded a gain on acquisition of R1,103.0 million		assumptions used to develop the estimate.
in the consolidated income statement. This transaction was
accounted for as a business combination.	•	We evaluated management's identification of the
		assets acquired and liabilities assumed and
Auditing the Company's accounting for this business		assessed the fair value measurements prepared by
combination was complex due to the significant judgement and		the Company.
estimation required by management to calculate the fair value
of the assets acquired and liabilities assumed, including	•	With the support of our valuation specialists, we
amongst others, property, plant and equipment, metal inventory		assessed the valuation models, business plans
and environmental rehabilitation obligations, and the		underlying the model, commodity prices, foreign
complexity of the model. The significant assumptions used to		exchange and the discount rate assumptions.
estimate the fair value included reserves and production
estimates, future costs of production, capital expenditure,	•	We involved geological specialists to assist in the
valuation of inventory, the commodity price, foreign exchange		evaluation of the reserves used in the future
and the discount rate applied. These significant assumptions		production estimate. For metal inventory, we
are forward-looking and could be affected by future economic		independently	recalculated	management's
and market conditions and required us to involve geological		determination of net realisable value by applying
and valuation specialists.		acquisition date pricing information to metal
		inventory quantity estimates at different stages of the
		refining process.
	•	We considered, together with supporting information,
		subsequent measurement period adjustments to the
		fair value measurements of assets acquired and
		liabilities assumed and assessed whether they
		qualify as measurement-period adjustments.
	•	We also evaluated the adequacy of the disclosures
		required pursuant to IFRS 3 in the notes to the
		consolidated financial statements.
Physical quantities of Marikana metal inventory
As more fully described in Note 21 to the consolidated financial	•	We obtained an understanding of the Company's
	procedures around the estimation of the physical
statements, PGM in process, prior to production as a final		quantities of metal PGM in process as part of initial
metal, is always contained in a carrier material. Determining the		audit procedures.
metal content contained in a carrier material requires
estimation by metallurgical specialists. Only the Marikana	•	We involved internal metallurgical experts to
operations process their own refined metal inventory, and PGM		evaluate management's estimation process and the
in process amounted to R3,826.5 million as at 31 December		data used from the assay results to estimate the total
2019.		amount of PGM in process. We attended inventory
The audit of the PGM in process is complex due to the highly		counts at the metal inventory processing areas
	where the Company's metallurgists sampled and
technical nature of the process and the specialized knowledge		assayed the carrier material.
required to evaluate the results. The Company samples
inventory through assays to determine the metal content and	•	To assess the information gathered from the
composition of the metals. The total metal inventory in the		inventory counts, we involved EY metallurgical
carrier metal is dependent on the accuracy of the assay, and		specialists to evaluate the adequacy of the
the quantum of metal inventory within requires estimation.		measurements performed by the Company and the
There is inherent uncertainty in the sampling and assays which		assay methodologies applied to determine the
could impact on the valuation of PGM in process at period end.		inventory quantity.
The Marikana inventory count was scheduled for October 2019,

41

prior to the acquisition by Sibanye-Stillwater, given the planning

•

We assessed the accuracy of management's

involved and necessary plant shutdowns required. Additional

adjustment to the PGM in process balance as a

audit effort was therefore required to perform a roll forward of

result of the count by comparing the adjustment to

the count to period end.

historical adjustments made by the Company.

The audit of the inventory count procedures and evaluation of

•

We performed a rollforward of the physical quantities

estimation results required the use of EY metallurgical

from the date of the inventory count through 31

specialists as the process is highly complex and specialised.

December 2019, taking into account additional

material processed and sales.

•

We assessed the Group's disclosures in respect of

the metal inventory, including the description of the

estimates and judgements in estimating the quantity

of metal inventory.

Valuation of Goodwill

•

We obtained an understanding, evaluated the design

The Company's

goodwill as at 31 December 2019 was

and tested the operating effectiveness of controls

over the

Company's

goodwill impairment

testing

R6,854.9 million. As discussed in Note 15 to the consolidated

process. For example, we tested the controls over

financial statements, goodwill is tested for impairment at least

management's review of the significant assumptions

annually, or

whenever

there are impairment indicators

to

used in determining the recoverable amount.

establish whether the asset might be impaired. Goodwill is

allocated to cash generating units, or CGUs, for impairment

•

We involved our valuation specialists to assist in the

testing.

review of methodologies applied in the Company's

Auditing management's annual goodwill impairment test was

cash flow models, and also for significant

assumptions such as the discount rate used by the

complex and highly judgmental due to the significant estimation

Company.

required to determine the recoverable amount of the underlying

CGUs.

In particular, the recoverable amount was based on

•

The specialists also assisted in evaluating future

cash flows over the life of the CGU using estimated cash flows

commodity price assumptions compared to

and are sensitive to significant assumptions such as changes

observable market data and current industry and

in the discount rate, expected commodity price, foreign

economic trends. We compared the projected

currency exchange rates, and mine plans, including production

operating cash flows, capital expenditures and other

costs and future capital expenditure, based on reserves and

cost movements against historical trends and on a

production estimates. These significant assumptions are

per ounce basis, and also compared the projections

forward-looking and could be affected by future economic and

to current economic trends.

market conditions. Additional audit effort was required for the

first year audit of these significant estimates in understanding

•

With the involvement of our geological specialists,

the assumptions, CGUs and cashflows.

we evaluated for certain CGU's the reserves used in

the mine plans and production estimates utilised by

Management.

•

We performed sensitivity analysis on significant

assumptions to evaluate the impact on the goodwill.

•

We assessed the Company's disclosures about

goodwill, including the description of the estimates

and judgements used in impairment testing.

Initial audit engagement

Initial audit engagements involve a number of considerations

•

We performed walkthroughs of processes and

controls on processed assessed to be significant as

not associated with recurring audits. Compared to an ongoing

a result of areas of higher risk, complex accounting

audit process in future years, the procedures for an initial audit

and higher judgement and estimations.

are either incremental in nature when compared to a recurring

•

We attended the prior year closing audit committee

audit. In

our

first

year

as auditors, significant audit

effort

is

meetings

at

which

the

predecessor

auditor

incurred

to

build

our

knowledge of the Company

and

its

presented

the

results

of its

audits to aid

in our

42

affiliates, by understanding their specific risks, controls,		understanding of key audit risk areas, and their
accounting policies and processes.			conclusions thereon.
In the first year as Group auditors, there is a risk of	•	We reviewed the predecessor auditor's audit files for
	assessment of reasonability of opening balances,
inappropriate reliance on opening balances and inconsistent		and the audit procedures performed, including more
application of accounting policies. There is also the risk of an		detailed discussions held on higher risk accounts
inappropriate audit approach resulting from incomplete		and accounts impacted by significant management
information about the Group and its operations, incorrect		judgement and estimation.
assessment of	significant risks and	identification of key	•	We reviewed the schedule of unadjusted differences
controls. Sibanye-Stillwater has a number of operations within
	recorded by the predecessor auditor and considered
the Group, and variations in processes and controls between
	the impact on the opening balances and the current
operations due to the legacy processes of prior acquisitions. It
	year financial statements.
was critical to	gain an	understanding	of the organizational
•	We reviewed the prior year control matters reported
structure, the	impact	on processes	and assessing that
	by predecessor auditor and by management.
accounting policies are applied consistently between periods
•	The information gathered from the above procedures
as well as operations. The results of these factors were key
drivers in the appropriate design of the Group Audit scoping		was applied in concluding on the appropriateness of
and design of appropriate audit programmes for the period.		opening balances, and in designing an appropriate
					audit programme for the group.
Other Matter

The financial statements of Sibanye Gold Limited, trading as Sibanye-Stillwater for the year ended 31 December 2018, were audited by another auditor who expressed an unmodified opinion on those statements on 29 March 2019.

Other Information

The directors are responsible for the other information. The other information comprises the information included in the 126-page document titled "Annual Financial Report 2019", which includes the Directors' report, the Report of the Audit Committee and the Company Secretary's Confirmation as required by the Companies Act of South Africa, the 261-page document titled "Integrated annual report 2019", the 185-page document titled "Mineral resources and mineral reserves report 2019", the 60-page document titled "Summarised report and notice of annual general meeting 2019" and 86-page document titled Company financial statements 2019. The other information does not include the consolidated or the separate financial statements and our auditor's reports thereon.

Our opinion on the consolidated financial statements does not cover the other information and we do not express an audit opinion or any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the Consolidated Financial Statements

The directors are responsible for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa, and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

43

In preparing the consolidated financial statements, the directors are responsible for assessing the group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or to cease operations, or have no realistic alternative but to do so.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
• Conclude on the appropriateness of the directors' use of the going concern basis of accounting and based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

44

We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the directors, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

In terms of the IRBA Rule published in Government Gazette Number 39475 dated 4 December 2015, we report that this is the first year Ernst & Young Inc. has been the auditor of Sibanye Gold Limited, trading as Sibanye-Stillwater.

Ernst & Young Inc.

Director - Lance Ian Neame Tomlinson

Registered Auditor

Chartered Accountant (SA)

102 Rivonia Road, Sandton

Johannesburg, South Africa

22 April 2020

45

CONSOLIDATED INCOME STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2019

Figures in million - SA rand	Notes	2019	2018	2017
Revenue	3	72,925.4	50,656.4	45,911.6
Cost of sales	4	(63,314.5)	(48,129.0)	(42,182.4)
Interest income	19, 20.1	560.4	482.1	415.5
Finance expense	5	(3,302.5)	(3,134.7)	(2,971.8)
Share-based payments	6	(363.3)	(299.4)	(231.9)
(Loss)/gain on financial instruments	19, 20, 26.5, 26.6	(6,015.1)	1,704.1	(1,114.4)
Gain on foreign exchange differences		325.5	1,169.1	292.4
Share of results of equity-accounted investees after tax	16	721.0	344.2	291.6
Other income		484.2	310.2	300.0
Other costs	7.1	(2,310.4)	(1,015.4)	(932.7)
Gain on disposal of property, plant and equipment		76.6	60.2	40.7
Impairments	8	(86.0)	(3,041.4)	(4,411.0)
Gain on derecognition of borrowings and derivative financial instrument	26.4, 26.5	-	230.0	-
Occupational healthcare expense	29	39.6	(15.4)	(1,106.9)
Restructuring costs	7.2	(1,252.4)	(142.8)	(729.8)
Transaction costs		(447.8)	(402.5)	(552.1)
Gain on acquisition	14.1	1,103.0	-	-
Loss before royalties, carbon tax and tax		(856.3)	(1,224.3)	(6,981.2)
Royalties	9.1	(431.0)	(212.6)	(398.5)
Carbon tax		(12.9)	-	-
Loss before tax		(1,300.2)	(1,436.9)	(7,379.7)
Mining and income tax	9.2	1,733.0	(1,083.8)	2,946.6
Profit/(loss) for the year		432.8	(2,520.7)	(4,433.1)
Attributable to:		62.1
Owners of Sibanye-Stillwater		(2,499.6)	(4,437.4)
Non-controlling interests		370.7	(21.1)	4.3
Earnings per share attributable to owners of Sibanye-Stillwater		2
Basic earnings per share - cents	10.1	(110.0)	(229)
Diluted earnings per share - cents	10.2	2	(110.0)	(229)

The accompanying notes form an integral part of these consolidated financial statements

CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2019

Figures in million - SA rand	2019	2018	2017
Profit/(loss) for the year	432.8	(2,520.7)	(4,433.1)
Other comprehensive income, net of tax	(465.9)	1,764.1	(627.2)
Foreign currency translation1	(594.8)	1,719.1	(632.4)
Mark-to-market valuation2	128.9	45.0	5.2
Total comprehensive income	(33.1)	(756.6)	(5,060.3)
Attributable to:	(403.1)
Owners of Sibanye-Stillwater	(733.1)	(5,064.6)
Non-controlling interests	370.0	(23.5)	4.3

1. These gains and losses will be reclassified to profit or loss
2. These gains and losses will never be reclassified to profit or loss

The accompanying notes form an integral part of these consolidated financial statements

Sibanye-Stillwater Annual Financial Report 2019

46

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2019

Figures in million - SA rand	Notes	2019	2018	2017
Assets
Non-current assets		74,908.1	69,727.7	64,067.3
Property, plant and equipment	12	57,480.2	54,558.2	51,444.6
Right-of-use assets	13	360.9	-	-
Goodwill	15	6,854.9	6,889.6	6,396.0
Equity-accounted investments	16	4,038.8	3,733.9	2,244.1
Other investments	18	598.7	156.0	-
Environmental rehabilitation obligation funds	19	4,602.2	3,998.7	3,492.4
Other receivables	20.1	683.5	314.4	284.0
Deferred tax assets	9.3	288.9	76.9	206.2
Current assets		26,163.7	15,195.3	12,004.5
Inventories	21	15,503.4	5,294.8	3,526.5
Trade and other receivables	22	4,635.0	6,833.0	6,197.6
Other receivables	20.1	51.2	35.2	35.2
Tax receivable	9.4	355.1	483.2	182.8
Cash and cash equivalents	23	5,619.0	2,549.1	2,062.4
Total assets		101,071.8	84,923.0	76,071.8
Equity and liabilities		29,670.6
Equity attributable to owners of Sibanye-Stillwater		23,788.4	23,978.4
Stated share capital	24	40,662.0	34,667.0	34,667.0
Other reserves		4,442.3	4,617.2	2,569.0
Accumulated loss		(15,433.7)	(15,495.8)	(13,257.6)
Non-controlling interests	25	1,467.7	936.0	19.8
Total equity		31,138.3	24,724.4	23,998.2
Non-current liabilities		55,606.7	45,566.0	43,635.8
Borrowings	26	23,697.9	18,316.5	23,992.0
Derivative financial instrument	26	4,144.9	408.9	1,093.5
Lease liabilities	27	272.8	-	-
Environmental rehabilitation obligation and other provisions	28	8,714.8	6,294.2	4,678.7
Post-retirement healthcare obligation		-	5.6	11.3
Occupational healthcare obligation	29	1,133.4	1,164.2	1,152.5
Share-based payment obligations	6.3	1,343.0	168.9	422.2
Other payables	20.2	2,687.5	2,529.2	3,760.4
Deferred revenue	30	6,896.5	6,525.3	-
Tax and royalties payable	9.4	59.1	-	-
Deferred tax liabilities	9.3	6,656.8	10,153.2	8,525.2
Current Liabilities		14,326.8	14,632.6	8,437.8
Borrowings	26	38.3	6,188.2	1,657.5
Lease liabilities	27	110.0	-	-
Occupational healthcare obligation	29	148.7	109.9	0.8
Share-based payment obligations	6.3	82.1	56.8	12.3
Trade and other payables	31	11,465.9	7,856.3	6,690.4
Other payables	20.2	761.4	303.3	41.9
Deferred revenue	30	1,270.6	30.1	-
Tax and royalties payable	9.4	449.8	88.0	34.9
Total equity and liabilities		101,071.8	84,923.0	76,071.8

The accompanying notes form an integral part of these consolidated financial statements

Sibanye-Stillwater Annual Financial Report 2019

47

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2019

							Equity
			Share-		Foreign		attributable
		Stated	based	Mark-to-	currency		to owners	Non-
		share	payment	market	translation	Accumulated	of Sibanye-	controlling	Total
Figures in million - SA rand	Notes	capital	reserve	reserve	reserve	loss	Stillwater	interests	equity
Balance at 31 December 2016		21,734.6	3,110.2	-	(131.4)	(8,262.0)	16,451.4	17.7	16,469.1
Total comprehensive income for the year		-	-	5.2	(632.4)	(4,437.4)	(5,064.6)	4.3	(5,060.3)
(Loss)/profit for the year		-	-	-	-	(4,437.4)	(4,437.4)	4.3	(4,433.1)
Other comprehensive income		-	-	5.2	(632.4)	-	(627.2)	-	(627.2)
Share-based payments	6	-	217.4	-	-	-	217.4	-	217.4
Dividends paid	11	-	-	-	-	(558.2)	(558.2)	(2.2)	(560.4)
Rights issue		12,932.4	-	-	-	-	12,932.4	-	12,932.4
Balance at 31 December 2017		34,667.0	3,327.6	5.2	(763.8)	(13,257.6)	23,978.4	19.8	23,998.2
Total comprehensive income for the year		-	-	47.4	1,719.1	(2,499.6)	(733.1)	(23.5)	(756.6)
Loss for the year		-	-	-	-	(2,499.6)	(2,499.6)	(21.1)	(2,520.7)
Other comprehensive income		-	-	47.4	1,719.1	-	1,766.5	(2.4)	1,764.1
Share-based payments	6	-	281.7	-	-	-	281.7	-	281.7
Dividends paid		-	-	-	-	-	-	(0.6)	(0.6)
Acquisition of subsidiary with non-controlling interests		-	-	-	-	-	-	940.3	940.3
Transaction with DRDGOLD shareholders		-	-	-	-	261.4	261.4	-	261.4
Balance at 31 December 2018		34,667.0	3,609.3	52.6	955.3	(15,495.8)	23,788.4	936.0	24,724.4
Total comprehensive income for the year		-	-	128.9	(594.1)	62.1	(403.1)	370.0	(33.1)
Profit for the year		-	-	-	-	62.1	62.1	370.7	432.8
Other comprehensive income		-	-	128.9	(594.1)	-	(465.2)	(0.7)	(465.9)
Share-based payments	6	-	290.3	-	-	-	290.3	-	290.3
Dividends paid		-	-	-	-	-	-	(85.0)	(85.0)
Shares issued for cash		1,688.4	-	-	-	-	1,688.4	-	1,688.4
Shares issued on Lonmin acquisition	14.1	4,306.6	-	-	-	-	4,306.6	-	4,306.6
Acquisition of subsidiary with non-controlling interests	14.1	-	-	-	-	-	-	247.0	247.0
Transaction with DRDGOLD shareholders		-	-	-	-	-	-	(0.3)	(0.3)
Balance at 31 December 2019		40,662.0	3,899.6	181.5	361.2	(15,433.7)	29,670.6	1,467.7	31,138.3

The accompanying notes form an integral part of these consolidated financial statements

Sibanye-Stillwater Annual Financial Report 2019

48

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2019

Figures in million - SA rand	Notes	2019	2018	2017
Cash flows from operating activities
Cash generated by operations	32	10,565.9	8,709.0	7,097.9
Deferred revenue advance received	30	2,859.3	6,555.4	-
Post-retirement health care payments		(6.1)	(6.6)	(6.4)
Cash-settledshare-based payments paid	6.3	(90.9)	(21.7)	(433.6)
Change in working capital	33	(625.6)	(1,070.0)	(522.3)
		12,702.6	14,166.1	6,135.6
Interest received		268.4	194.7	118.7
Interest paid		(1,603.1)	(1,620.8)	(2,053.9)
Royalties paid	9.4	(411.5)	(234.4)	(387.4)
Tax paid	9.4	(1,407.4)	(307.8)	(511.9)
Dividends paid		(85.0)	(0.6)	(560.4)
Net cash from operating activities		9,464.0	12,197.2	2,740.7
Cash flow from investing activities		(7,705.9)
Additions to property, plant and equipment		(7,080.7)	(6,098.8)
Proceeds on disposal of property, plant and equipment		101.0	81.9	71.3
Acquisition of subsidiaries	14	(129.0)	-	(27,386.4)
Cash acquired on acquisition of subsidiaries		3,004.3	282.8	1,792.2
Proceeds with transfer of assets to joint operation		30.6	-	-
Dividends received		111.0	125.2	-
Contributions to environmental rehabilitation funds	19	(12.9)	(95.3)	(114.5)
Payment of Deferred Payment (related to the Rustenburg operation acquisition)	20.2	(283.4)	(38.6)	-
Loan advanced to equity-accounted investee		-	(3.1)	(13.5)
Payments to dissenting shareholders	20.2	(319.4)	(1,375.8)	-
Proceeds on loss of control of subsidiaries		-	256.1	-
Preference shares redeemed by equity-accounted investee	16.1	186.9	102.8	-
Proceeds on disposal of marketable securities investments		-	1.2	3,605.3
Receipts from environmental rehabilitation trust fund	19	151.9	-	-
Net cash used in investing activities		(4,864.9)	(7,743.5)	(28,144.4)
Cash flow from financing activities		18,981.7
Loans raised	26	17,130.2	69,593.8
Loans repaid	26	(22,008.3)	(21,231.5)	(55,719.5)
Lease payments		(131.7)	-	-
Proceeds from shares issued		1,688.4	-	13,438.5
Transaction costs paid on rights issue shares issued		-	-	(506.1)
Net cash (used in)/from financing activities		(1,469.9)	(4,101.3)	26,806.7
Net increase in cash and cash equivalents		3,129.2	352.4	1,403.0
Effect of exchange rate fluctuations on cash held		(59.3)	134.3	(308.5)
Cash and cash equivalents at beginning of the year		2,549.1	2,062.4	967.9
Cash and cash equivalents at end of the year	23	5,619.0	2,549.1	2,062.4

The accompanying notes form an integral part of these consolidated financial statements

Sibanye-Stillwater Annual Financial Report 2019

49

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2019

1. Accounting policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. Where an accounting policy is specific to a note, the policy is described in the note which it relates to. These policies have been consistently applied to all the periods presented except for the adoption of IFRS 16 Leases (IFRS 16).

1. Reporting entity
   On 24 February 2020 Sibanye Gold Limited and Sibanye Stillwater Limited implemented a scheme of arrangement to reorganise Sibanye Gold Limited's operations under a new parent company, Sibanye Stillwater Limited. These historical consolidated financial statements are those of Sibanye Gold Limited's business as of 31 December 2019, 2018 and 2017 and for each of the fiscal years in the three-year period ended 31 December 2019. Sibanye Gold Limited is the predecessor of Sibanye Stillwater Limited for consolidated financial reporting purposes. For future financial reporting periods Sibanye Stillwater Limited's consolidated comparative information will be presented as if the reorganisation had occurred before the start of the earliest period presented. For more information related to the accounting treatment of the scheme of arrangement (refer note 38.1).
   Sibanye Gold Limited, trading as Sibanye-Stillwater(Sibanye-Stillwater or the Group), an independent, global, precious metals mining company, produces a mix of metals that includes gold and platinum group metals (PGM). Domiciled in South Africa, Sibanye-Stillwater currently owns and operates a portfolio of high-quality operations and projects, which are grouped into two regions: the Southern Africa (SA) region and the United States (US) region.
   The SA region houses the gold and PGM operations and projects located in South Africa and Zimbabwe. The underground and surface gold mining operations in South Africa are the Driefontein and Kloof operations in the West Witwatersrand (West Wits) region and DRDGOLD Limited with surface tailings treatment plant in the East of Johannesburg in Gauteng, and the Beatrix operation in the southern Free State. Sibanye-Stillwater also owns and manages significant gold extraction and processing facilities where ore is treated and beneficiated to produce gold doré. In addition, several organic projects currently underway are aimed at sustaining these gold mining operations into the long term. The PGM assets in the SA region are Kroondal (50%), the Rustenburg operation, the Marikana operation and the tailings retreatment entity, Platinum Mile (91.7%) in North West Province, and Mimosa (50%) in Zimbabwe.
   The US region houses the PGM operations and projects located in the US and Canada. These include the East Boulder and Stillwater mining operations and the Blitz project in Montana, in the US, and exploration-stage projects, Altar (joint venture) in Argentina and Marathon (joint operation), a PGM-copper porphyry in Ontario, Canada. The assets in this region also include the Metallurgical complex in Columbus, Montana. This complex houses the smelter, base metal refinery and an analytical laboratory which produces a PGM-rich filter cake that is further refined by a third-party precious metal refinery. These processing and metallurgical facilities are also used to process recycled material such as spent autocatalytic convertors and petroleum refinery catalysts.
2. Basis of preparation
   The consolidated financial statements for the year ended 31 December 2019 have been prepared on a going concern basis in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board, the South African Institute of Chartered Accountants Financial Reporting Guides issued by the Accounting Practices Committee and Financial Reporting Pronouncements issued by the Financial Reporting Standards Council, as well as the requirements of the South African Companies Act and JSE Listings Requirements. The consolidated financial statements have been prepared under the historical cost convention, except for certain financial assets and financial liabilities (including derivative instruments) which are measured at fair value through profit or loss or other comprehensive income.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Standards, interpretations and amendments to published standards effective for the year ended 31 December 2019

During the financial year, the following new accounting standards became effective and had an impact on the financial statements:

Pronouncement	Details of amendments	Effective date1
IFRS 16 Leases (New standard)	IFRS 16 Leases was adopted with effect from 1 January 2019. The standard	1 January 2019
	sets out the principles for the recognition, measurement, presentation and
	disclosure of leases and requires lessees to account for most leases under a
	single on-balance sheet model. IFRS 16 supersedes IAS 17 Leases, IFRIC 4
	Determining whether an Arrangement contains a Lease, SIC-15 Operating
	Leases-Incentives and SIC-27 Evaluating the Substance of Transactions
	Involving the Legal Form of a Lease. Under the new standard, all lessee
	lease contracts, with limited exceptions, are recognised in the financial
	statements by way of right-of-use assets and corresponding lease liabilities.
	The Group's leases comprise mining equipment, vehicles and office rentals.
	The Group is not a lessor and IFRS 16 therefore only impacted lessee
	accounting.
	As a practical expedient, the Group applied the modified retrospective
	transition method, and consequently comparative information is not restated.
	Under this method, the standard is applied retrospectively with the
	cumulative effect recognised as an adjustment to the opening balance of
	accumulated loss at the date of initial application. The Group has applied the
	new definition of a lease to all arrangements still effective at the date of initial
	application.
	The Group also elected to use the recognition exemptions for lease contracts
	that, at the commencement date, have a lease term of 12 months or less and
	do not contain a purchase option, and lease contracts for which the
	underlying asset is of low value. In addition, certain variable lease payments
	are not permitted to be recognised as lease liabilities and are expensed as
	incurred.
	Under the modified retrospective transition approach, lease payments were
	discounted at 1 January 2019 using an incremental borrowing rate
	representing the rate of interest that the entity within the Group which entered
	into the lease would have to pay to borrow over a similar term, and with a
	similar security, the funds necessary to obtain an asset of a similar value to
	the right-of-use asset in a similar economic environment. The average rate
	applied is 4.05% for the US operations and 9.22% for the SA operations.
	Lease liabilities were measured at the present value of the remaining lease
	payments, discounted using the entity-specific incremental borrowing rates
	described above. The Group elected to recognise the right-of-use assets for
	all leases based on an amount equal to the lease liabilities. There were no
	onerous lease contracts that would require an adjustment to the right-of-use
	assets at the date of initial application.
	The impact of adopting of the new accounting standard on the statement of
	financial position on 1 January 2019 was as follows:
	• increase in right-of-use assets by R302.0 million
	• increase in lease liabilities by R302.0 million
	• no impact on accumulated loss
	(refer note 13 and note 27)

1 Effective date refers to annual period beginning on or after said date

During the financial year, the following new and revised accounting standards and amendments to standards became effective and had no significant impact on the Group's financial statements:

Pronouncement		Details of amendments		Effective date1
IFRS 3 Business Combinations		Annual Improvements 2015-2017 Cycle		1 January 2019
(Amendment)		Clarification that when an entity obtains control of a business that is a joint
		operation, it is required to remeasure previously held interests in that
		business.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

IFRS 9 Financial instruments	Prepayment Features with Negative Compensation	1 January 2019
(Amendment)	The narrow-scope amendment allows companies to measure particular
	prepayable financial assets with negative compensation at amortised cost or
	at fair value through other comprehensive income if a specified condition is
	met.
IFRS 11 Disclosure of Interest in	Annual Improvements 2015-2017 Cycle	1 January 2019
Other Entities (Amendment)	Clarification that when an entity obtains joint control of a business that is a
	joint operation, the entity does not remeasure previously held interests in that
	business.
IAS 12 Income Taxes (Amendment)	Annual Improvements 2015-2017 Cycle	1 January 2019
	Clarification that all income tax consequences of dividends should be
	recognised consistently with the transactions that generated the distributable
	profits.
IAS 19 Employee Benefits	Plan Amendment, Curtailment or Settlement	1 January 2019
(Amendment)	The amendments clarify that:
	•	on amendment, curtailment or settlement of a defined benefit plan,
		a company now uses updated actuarial assumptions to determine
		its current service cost and net interest for the period; and
	•	the effect of the asset ceiling is disregarded when calculating the
		gain or loss on any settlement of the plan and is dealt with
		separately in other comprehensive income (OCI).
IAS 23 Borrowing Costs	Annual Improvements 2015-2017 Cycle	1 January 2019
(Amendment)	The amendments clarify that if any specific borrowing remains outstanding
	after the related asset is ready for its intended use or sale, that borrowing
	becomes part of the funds that an entity borrows generally when calculating
	the capitalisation rate on general borrowings.
IAS 28 Investments in Associates	Long-term interest in Associates and Joint Ventures	1 January 2019
and Joint Ventures (Amendment)	Clarification provided that an entity should apply IFRS 9 to long-term
	interests in an associate or joint venture that form part of the net investment
	in the associate or joint venture but to which the equity method is not applied.
IFRIC 23 Uncertainty over Income	The interpretation specifies how an entity should reflect the effects of	1 January 2019
Tax Treatments	uncertainties in accounting for income taxes.
	United States of America - Stillwater operations
	The Group's 2019 income tax provision appropriately reflects the impact of
	the uncertain income tax position, totalling ZAR 123.2m (US$8.8m) in
	respect of the section 163(j) interest limitation as well as certain other
	adjustments arising primarily from Alternative Minimum Tax (AMT) and base
	erosion and anti-abuse tax (BEAT) requirements.
	Marikana Operations, South Africa
	As at 31 December 2019 the transfer pricing audit for the years of
	assessment 2011-2014 were still open for review with the South African
	Revenue Service (SARS); to date no assessments have been raised.
	Management is of the opinion that the relevant charges were claimed
	correctly, and that relevant information has been supplied to the SARS on a
	timely basis. On the basis of consultation with External Legal counsel,	no
	material payment is anticipated and therefore no provision has been made in
	terms of IFRIC 23 as at 31 December 2019.

1 Effective date refers to annual period beginning on or after said date

Standards, interpretations and amendments to published standards which are not yet effective

Certain new standards, amendments and interpretations to existing standards have been published that apply to the Group's accounting periods beginning on or after 1 January 2020 but have not been early adopted by the Group. The standards, amendments and interpretations that are applicable to the Group are:

Pronouncement	Details of amendments and estimated impact		Effective date1
IAS 1 Presentation of Financial	The amendments clarify and align the definition of 'material' and provide		1 January 2020
Statements (Amendment) 2	guidance to help improve consistency in the application of that concept
	whenever it is used in IFRS.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Pronouncement	Details of amendments and estimated impact	Effective date1
IAS 8 Accounting Policies, Changes	The amendments clarify and align the definition of 'material' and provide	1 January 2020
in Accounting Estimates and Errors	guidance to help improve consistency in the application of that concept
(Amendment) 2	whenever it is used in IFRS Standards.
IFRS 3 Business Combinations	The IASB issued amendments to the definition of a business in IFRS 3	1 January 2020
(Amendment) 2	Business Combinations to help entities determine whether an acquired set of
	activities and assets is a business or not.
The revised Conceptual Framework	The Conceptual Framework is to assist the Board in developing standards, to	1 January 2020
for Financial Reporting 2	help preparers develop consistent accounting policies if there is no
	applicable standard in place and to assist all parties to understand and
	interpret the standards.

1. Effective date refers to annual period beginning on or after said date
2. No impact

Significant accounting judgements and estimates

The preparation of the financial statements requires the Group's management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The determination of estimates requires the exercise of judgement based on various assumptions and other factors such as historical experience, current and expected economic conditions, and in some cases valuation techniques. Actual results could differ from those estimates.

For significant accounting policies that are subject to significant judgement, estimates and assumptions, see the following notes to the consolidated financial statements:

Significant accounting policy	Note to the consolidated financial statements
Revenue	3 - Revenue
Royalties, mining and income tax, and deferred tax	9 - Royalties, mining and income tax, and deferred tax
Property, plant and equipment	12	- Property, plant and equipment
Business combinations	14	- Acquisitions
Goodwill	15	- Goodwill
Equity-accounted investments	16	- Equity accounted investments
Other receivables and other payables	20	- Other receivables and other payables
Inventories	21	- Inventories
Borrowings	26	- Borrowings and derivative financial instrument
Environmental rehabilitation obligation	28	- Environmental rehabilitation obligation and other provisions
Occupational healthcare obligation	29	- Occupational healthcare obligation
Deferred revenue	30	- Deferred revenue
Contingent liabilities	36	- Contingent liabilities

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the financial period are discussed under the relevant note of the item affected.

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53

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

1.3 Consolidation

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

1. The non-controlling interests in the statement of changes in equity relates to the attributable share of accumulated profits of DRDGOLD Limited (DRDGOLD), the Newshelf 1114 Proprietary Limited (Newshelf 1114) group, Goldfields Technical Security Management Proprietary Limited (GTSM) and Platinum Mile Resources Proprietary Limited (Platinum Mile) (refer to note 25)
2. Witwatersrand Consolidated Gold Resources Proprietary Limited (Wits Gold) has ceded and pledged its shares in K2013164354 Proprietary Limited (K2013) (a dormant entity) and K2013 has ceded and pledged it shares in Sibanye Gold Eastern Operations Proprietary Limited (SGEO) in favour of the lenders of the Burnstone Debt (refer to note 26.6)
3. Rand Uranium Proprietary Limited (Rand Uranium) and Ezulwini Mining Company Proprietary Limited (Ezulwini) together own a number of underground and surface mining operations. These operations report to the Group's chief operating decision maker (the Executive Committee) as a separate segment, namely Cooke
4. In terms of the Rustenburg operation Transaction, a 26% stake in Sibanye Rustenburg Platinum Mines Proprietary Limited (SRPM) was acquired through Newshelf 1335 Proprietary Limited (BBBEE SPV). The shareholders of BBBEE SPV are Rustenburg Mine Employees Trust (30.4%), Rustenburg Mine Community Development Trust (24.8%) Bakgatla-Ba-Kgafela Investment Holdings (24.8%) and Siyanda Resources Proprietary Limited (20.0%). The Rustenburg Mine Employees Trust and the Rustenburg Mine Community Development Trust are controlled and consolidated by Sibanye-Stillwater
5. The Group has no current or contractual obligation to provide financial support to any of its structured entities
6. Sibanye Stillwater recognises 6.87% non-controlling interests. The effective "outside" shareholding are indirect interests held by LSA UK Limited (6.13%) and Phembani Group (13.01%) through Incwala Platinum (Pty) Ltd . Phembani secured its shareholding with a loan payable to Lonmin Limited UK which has subsequently been impaired, therefore a beneficial interest of zero.
7. Sibanye Stillwater recognises 4.75% non-controlling interests. The effective "outside" shareholders are Lonplats Siyakhula employee profit share trust (3.8%), Marikana Community Trust (0.9%), Bapo Ba Mogale Community Trust (0.9%) and Phembani Group (9.01%) and LSA UK Limited (4.24%) holds an indirect interest through Incwala Platinum (Pty) Ltd.

Subsidiaries

Subsidiaries are all entities over which the Group exercises control. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are consolidated from the date on which control is obtained by the Group until the date on which control ceases. Control is reassessed if facts and circumstances indicate that there are changes to one or more of the elements of control.

Although the Group owns less than half of DRDGOLD and has less than half of DRDGOLD's voting power, management has determined that the Group controls the entity. The Group controls DRDGOLD as a result of an option to subscribe for a sufficient number of DRDGOLD ordinary shares to attain a 50.1% shareholding in DRDGOLD at a 10% discount to the 30 day volume weighted average traded price, which is considered substantive (refer note 38.2).

Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Transactions with shareholders of Sibanye-Stillwater

Transactions with owners in the capacity as equity participants are not recognised in profit or loss, but instead are recognised in equity with a corresponding change in assets or liabilities.

1.4 Foreign currencies

Functional and presentation currency

Items included in the financial statements of each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates (the functional currency). The consolidated financial statements are presented in South African rand, which is the Group's presentation currency.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities are translated into the functional currency at each reporting date. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies, are recognised in profit or loss.

Foreign operations

The results and financial position of all the Group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

• Assets and liabilities are translated at the exchange rate ruling at the reporting date. Equity items are translated at historical rates. The income and expenses are translated at the average exchange rate for the year, unless this average was not a reasonable approximation of the rates prevailing on the transaction dates, in which case these items were translated at the rate prevailing on the date of the transaction. Exchange differences on translation are accounted for in other comprehensive income. These differences will be recognised in profit or loss upon realisation of the underlying operation.
• Exchange differences arising from the translation of the net investment in foreign operations, which includes certain long-term borrowings (i.e. the reporting entity's interest in the net assets of that operation), are taken to other comprehensive income. When a foreign operation is sold, exchange differences that were recorded in other comprehensive income are recognised in profit or loss as

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

part of the gain or loss on disposal. If the Group disposes of part of its interest in a subsidiary but retains control, then the relevant proportion of the cumulative amount is reattributed to non-controlling interests. When the Group disposes of only part of an associate or joint venture while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.

• Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and are translated at each reporting date at the closing rate.

1.5 Comparatives

Where necessary comparative periods may be adjusted to conform to current period changes in presentation.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

2. Segment reporting

Accounting policy

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker and is based on individual mining operations. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the executive management team that makes strategic decisions.

Total

Group

Corporate

Corporate

Corporate

US PGM

Total

Total

Rusten-

and re-

Total

and re-

and

operations

Southern

SA PGM

burg

Platinum

conciling

SA gold

Drie-

DRD-

conciling

reconciling

Figures in million - SA rand

Group

Stillwater

Africa

operations

operation

Marikana1 Kroondal

Mile

Mimosa

items2

operations

fontein

Kloof Beatrix Cooke

GOLD

items2

items

2019	72,925.4	26,864.5	46,222.6															(161.7)
Revenue	27,578.4	10,499.5	11,187.9	5,590.4	300.6	2,342.6	(2,342.6)	18,644.2	3,303.1	6,808.5	3,798.2	828.4	3,621.0	285.0
Underground	51,528.2	12,343.3	39,346.6	26,616.5	9,901.1	11,125.0	5,590.4	-	2,342.6	(2,342.6)	12,730.1	3,301.4	5,552.4	3,576.9	21.2	-	278.2	(161.7)
Surface	6,876.0	-	6,876.0	961.9	598.4	62.9	-	300.6	-	-	5,914.1	1.7	1,256.1	221.3	807.2	3,621.0	6.8	-
Recycling	14,521.2	14,521.2	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-
Cost of sales, before amortisation	(56,100.4)	(19,569.4)	(36,531.0)	(18,196.7)	(6,466.9)	(8,439.9)	(3,076.3)	(213.6) (1,336.3)	1,336.3	(18,334.3)	(4,438.6)	(6,872.9)	(3,669.2)	(617.3)	(2,736.3)	-	-
and depreciation
Underground	(36,520.3)	(5,600.8)	(30,919.5)	(17,207.9)	(5,691.7)	(8,439.9)	(3,076.3)	-	(1,336.3)	1,336.3	(13,711.6)	(4,428.6)	(5,741.1)	(3,525.3)	(16.6)	-	-	-
Surface	(5,611.5)	-	(5,611.5)	(988.8)	(775.2)	-	-	(213.6)	-	-	(4,622.7)	(10.0)	(1,131.8)	(143.9)	(600.7)	(2,736.3)	-	-
Recycling	(13,968.6)	(13,968.6)	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-	-
Net other cash costs3	(1,869.0)	(4.2)	(1,864.8)	(585.5)	(156.1)	(299.9)	(103.4)	(25.3)	(8.0)	7.2	(1,279.3)	(197.6)	(152.7)	(179.8)	(568.6)	(30.7)	(149.9)	-
Adjusted EBITDA	14,956.0	7,290.9	7,826.8	8,796.2	3,876.5	2,448.1	2,410.7	61.7	998.3	(999.1)	(969.4)	(1,333.1)	(217.1)	(50.8)	(357.5)	854.0	135.1	(161.7)
Amortisation and depreciation	(7,214.1)	(2,285.6)	(4,928.5)	(1,919.0)	(914.4)	(500.4)	(494.8)	(4.8)	(218.7)	214.1	(3,009.5)	(920.5)	(1,200.9)	(640.0)	(15.1)	(172.1)	(60.9)	-
Interest income	560.4	145.2	415.2	145.8	44.6	30.9	67.1	1.3	2.2	(0.3)	269.4	60.1	53.0	31.4	39.8	64.5	20.6	-
Finance expense	(3,302.5)	(920.7)	(2,381.8)	(704.2)	(1,407.5)	(282.4)	(146.9)	-	(21.8)	1,154.4	(1,677.6)	(242.8)	(242.9)	(141.1)	(73.7)	(73.0)	(904.1)	-
Share-based payments	(363.3)	(53.4)	(309.9)	-	-	-	-	-	-	-	(309.9)	-	-	-	-	(64.2)	(245.7)	-
Net other4	(4,925.8)	8.3	(4,934.1)	(1,513.2)	(11,381.8)	12.9	(0.3)	1.1	(137.2)	9,992.1	(3,420.9)	17.5	31.0	13.4	(113.9)	81.6	(3,450.5)	-
Non-underlying items5	(567.0)	(74.6)	(492.4)	258.8	2.4	212.7	44.8	-	(27.5)	26.4	(751.2)	(169.5)	(35.1)	(112.4)	(6.9)	4.3	(431.6)	-
Royalties and carbon tax	(443.9)	-	(443.9)	(358.2)	(296.1)	(54.5)	(7.6)	-	(77.1)	77.1	(85.7)	(16.6)	(34.2)	(30.8)	(4.1)	-	-	-
Current taxation	(1,848.7)	(481.3)	(1,367.4)	(1,303.7)	(780.3)	13.3	(536.0)	-	(135.5)	134.8	(63.7)	(22.7)	(5.5)	(13.3)	-	(69.1)	46.9	-
Deferred taxation	3,581.7	1,436.3	2,145.4	14.1	30.0	-	(0.7)	(16.5)	(5.6)	6.9	2,131.3	74.8	150.4	89.9	-	(129.9)	1,946.1	-
Profit/(loss) for the year	432.8	5,065.1	(4,470.6)	3,416.6	(10,826.6)	1,880.6	1,336.3	42.8	377.1	10,606.4	(7,887.2)	(2,552.8)	(1,501.3)	(853.7)	(531.4)	496.1	(2,944.1)	(161.7)
Attributable to:	62.1	5,065.1	(4,841.3)															(161.7)
Owners of the parent	3,355.0	(10,826.6)	1,821.6	1,336.3	39.3	377.1	10,607.3	(8,196.3)	(2,552.8)	(1,501.3)	(853.7)	(531.4)	188.7	(2,945.8)
Non-controlling interest holders	370.7	-	370.7	61.6	-	59.0	-	3.5	-	(0.9)	309.1	-	-	-	-	307.4	1.7	-
Sustaining capital expenditure	(2,039.3)	(321.7)	(1,717.6)	(1,203.2)	(316.3)	(660.4)	(212.8)	(13.3)	(343.1)	342.7	(514.4)	(163.0)	(238.1)	(70.5)	-	(42.8)	-	-
Ore reserve development	(3,401.9)	(1,036.2)	(2,365.7)	(1,029.2)	(500.6)	(528.6)	-	-	-	-	(1,336.5)	(512.9)	(590.4)	(233.2)	-	-	-	-
Growth projects	(2,264.9)	(2,035.0)	(229.9)	(15.2)	(1.8)	-	-	(13.4)	-	-	(214.7)	-	(108.9)	(2.1)	-	(39.0)	(64.7)	-
Total capital expenditure	(7,706.1)	(3,392.9)	(4,313.2)	(2,247.6)	(818.7)	(1,189.0)	(212.8)	(26.7)	(343.1)	342.7	(2,065.6)	(675.9)	(937.4)	(305.8)		(81.8)	(64.7)	-

1. The SA PGM operations' results for the year ended 31 December 2019 include Marikana for the seven months since acquisition (refer to note 14.1)
2. Corporate and reconciling items represents the items to reconcile segment data to consolidated financial statement totals. This does not represent a separate segment as it does not generate mining revenue. Corporate includes net revenue generated through the Wheaton Stream settlement mechanism
3. Net other cash costs consist of care and maintenance, strike cost and other costs as detailed in profit or loss. Lease payments are included in net other cash costs to conform with the adjusted EBITDA reconciliation disclosed in note 26.9
4. Net other consists of gain on financial instruments, gain on foreign exchange differences, and change in estimate of environmental rehabilitation obligation, and right of recovery receivable and payable as detailed in profit or loss. Corporate and reconciling items net other includes the share of results of equity-accounted investees after tax as detailed in profit or loss
5. Non-underlyingitems consists of gain on disposal of property, plant and equipment, impairments, gain on acquisition, occupational healthcare expense, restructuring costs and transaction costs as detailed in profit or loss

Sibanye-Stillwater Annual Financial Report 2019

57

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Total

Corporate

Corporate

Group

Corporate

US PGM

Total

Total

Rusten-

and re-

Total

and re-

and

Figures in million - SA rand

Group

operations

Southern

SA PGM

Kroondal

Platinum

Mimosa

burg

conciling

SA gold

Drie-

Kloof

Beatrix

Cooke

DRD-

conciling

reconciling

Stillwater

Africa

operations

Mile

operation

items2

operations

fontein

GOLD1

items2

items

2018

Revenue	50,656.4	15,872.8	34,810.3	15,153.6	3,584.4	196.7	1,857.5	11,372.5	(1,857.5)	19,656.7	5,111.2	8,131.7	4,601.3		841.8	1,047.5	(76.8)	(26.7)
Underground	38,605.7	8,430.1	30,202.3	14,045.1	3,584.4	-	1,857.5	10,460.7	(1,857.5)	16,157.2	4,782.4	6,937.9	4,467.8		45.9	-	(76.8)	(26.7)
Surface	4,608.0	-	4,608.0	1,108.5	-	196.7	-	911.8	-	3,499.5	328.8	1,193.8	133.5		795.9	1,047.5	-	-
Recycling	7,442.7	7,442.7	-	-	-	-	-	-	-	-	-	-	-		-	-	-	-
Cost of sales, before amortisation	(41,515.2)	(11,720.9)	(29,794.3)															-
and depreciation	(12,096.0)	(2,739.4)	(152.7) (1,235.7)	(9,203.9)	1,235.7	(17,698.3)	(5,709.3)	(6,364.8)	(3,910.8)		(693.4)	(1,020.0)	-
Underground	(30,248.7)	(4,524.4)	(25,724.3)	(11,131.4)	(2,739.4)	-	(1,235.7)	(8,392.0)	1,235.7	(14,592.9)	(5,386.7)	(5,352.2)	(3,841.0)		(13.0)	-	-	-
Surface	(4,070.0)	-	(4,070.0)	(964.6)	-	(152.7)	-	(811.9)	-	(3,105.4)	(322.6)	(1,012.6)	(69.8)		(680.4)	(1,020.0)	-	-
Recycling	(7,196.5)	(7,196.5)	-	-	-	-	-	-	-	-	-	-	-		-	-	-	-
Net other cash costs3	(771.8)	-	(771.8)	(175.8)	(52.7)	(1.2)	(6.7)	(121.1)	5.9	(596.0)	(50.2)	(44.8)	(37.2)		(573.4)	8.7	100.9	-
Adjusted EBITDA	8,369.4	4,151.9	4,244.2	2,881.8	792.3	42.8	615.1	2,047.5	(615.9)	1,362.4	(648.3)	1,722.1	653.3		(425.0)	36.2	24.1	(26.7)
Amortisation and depreciation	(6,613.8)	(2,234.4)	(4,379.4)	(1,074.4)	(370.4)	(3.0)	(191.6)	(697.1)	187.7	(3,305.0)	(1,200.9)	(1,378.8)	(635.3)		(5.7)	(57.9)	(26.4)	-
Interest income	482.1	83.2	398.9	83.5	60.3	1.3	0.1	20.2	1.6	315.4	94.3	72.0	40.0		41.7	26.1	41.3	-
Finance expense	(3,134.7)	(1,797.1)	(1,177.3)	(422.4)	(130.5)	-	(13.0)	(1,890.6)	1,611.7	(754.9)	(234.9)	(245.9)	(143.6)		(78.1)	(33.0)	(19.4)	(160.3)
Share-based payments	(299.4)	(35.7)	(263.7)	-	-	-	-	-	-	(263.7)	(0.2)	-	-		-	(3.2)	(260.3)	-
Net other4	3,284.0	68.8	3,215.2	726.3	137.6	0.7	(9.2)	4,348.0	(3,750.8)	2,488.9	(362.8)	(110.3)	(57.8)		(106.2)	(419.1)	3,545.1	-
Non-underlying items5	(3,311.9)	(210.7)	(3,101.2)	(29.7)	0.4	-	-	(30.7)	0.6	(3,071.5)	(2,157.6)	27.2	(156.6)		(50.6)	(4.6)	(729.3)	-
Royalties	(212.6)	-	(212.6)	(162.0)	(5.5)	-	(57.6)	(156.5)	57.6	(50.6)	1.4	(29.0)	(18.8)		(4.2)	-	-	-
Current taxation	(95.3)	238.3	(333.6)	(278.5)	-	-	(103.4)	(277.4)	102.3	(55.1)	63.9	(75.3)	5.5		0.8	(3.0)	(47.0)	-
Deferred taxation	(988.5)	(1,795.7)	807.2	(192.6)	(168.9)	(9.2)	(29.9)	(15.5)	30.9	999.8	922.9	313.1	127.8		-	(132.0)	(232.0)	-
(Loss)/profit for the year	(2,520.7)	(1,531.4)	(802.3)	1,532.0	315.3	32.6	210.5	3,347.9	(2,374.3)	(2,334.3)	(3,522.2)	295.1	(185.5)		(627.3)	(590.5)	2,296.1	(187.0)
Attributable to:	(2,499.6)	(1,531.4)	(781.2)															(187.0)
Owners of the parent	1,529.3	315.3	29.9	210.5	3,347.9	(2,374.3)	(2,310.5)	(3,522.2)	295.1	(185.5)		(627.3)	(565.8)	2,295.2
Non-controlling interest holders	(21.1)	-	(21.1)	2.7	-	2.7	-	-	-	(23.8)	-	-	-		-	(24.7)	0.9	-
Sustaining capital expenditure	(1,271.2)	(260.2)	(1,011.0)	(464.4)	(141.4)	(9.5)	(170.9)	(313.5)	170.9	(546.6)	(228.1)	(220.6)	(82.6)		-	(14.5)	(0.8)	0
Ore reserve development	(3,530.4)	(998.9)	(2,531.5)	(477.9)	-	-	-	(477.9)	-	(2,053.6)	(817.1)	(839.6)	(396.9)		-	-	-	-
Growth projects	(2,279.2)	(1,574.0)	(705.2)	(57.7)	-	(57.1)	-	(0.6)	-	(647.5)	(0.4)	(141.8)	(1.7)		-	(303.3)	(200.3)	-
Total capital expenditure	(7,080.8)	(2,833.1)	(4,247.7)	(1,000.0)	(141.4)	(66.6)	(170.9)	(792.0)	170.9	(3,247.7)	(1,045.6)	(1,202.0)	(481.2)	-		(317.8)	(201.1)	-

1. DRDGOLD's performance is for five months ended 31 December 2018 since acquisition
2. Corporate and reconciling items represents the items to reconcile segment data to consolidated financial statement totals. This does not represent a separate segment as it does not generate mining revenue. Corporate includes net revenue generated through the Wheaton Stream settlement mechanism
3. Net other cash costs consist of care and maintenance, strike costs and other costs as detailed in profit or loss
4. Net other costs consists of gain on financial instruments, gain on foreign exchange differences, change in estimate of environmental rehabilitation obligation, and right of recovery receivable and payable, and other income. Corporate and reconciling items net other costs includes the share of results of equity-accounted investees after tax as detailed in profit or loss
5. Non-underlyingitems consists of gain on disposal of property, plant and equipment, impairments, gain on derecognition of borrowings and derivative financial instrument, occupational healthcare expense, restructuring costs, and transaction costs as detailed in profit or loss

Sibanye-Stillwater Annual Financial Report 2019

58

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Total

Corporate

Corporate

US PGM

Total

Total

Rusten-

and re-

Total

and re-

Figures in million - SA rand

Group

operations2

Southern

SA PGM

Kroondal

Platinum

Mimosa

burg

conciling

SA gold

Driefontein

Kloof

Beatrix

Cooke

conciling

Stillwater

Africa

operations

Mile

operation

items1

operations

items1

2017

Revenue	45,911.6	9,161.6	36,750.0	13,276.4	2,861.5	194.1	1,687.7	10,220.8	(1,687.7)	23,473.6	8,076.9	8,845.1	4,875.8	1,676.5	(0.7)
Underground	37,790.3	4,622.3	33,168.0	12,024.8	2,861.5	-	1,687.7	9,163.3	(1,687.7)	21,143.2	7,148.1	7,985.3	4,753.1	1,257.4	(0.7)
Surface	3,582.0	-	3,582.0	1,251.6	-	194.1	-	1,057.5	-	2,330.4	928.8	859.8	122.7	419.1	-
Recycling	4,539.3	4,539.3	-	-	-	-	-	-	-	-	-	-	-	-	-
Cost of sales, before amortisation	(36,482.7)	(7,011.7)	(29,471.0)
and depreciation	(11,591.8)	(2,395.9)	(129.8)	(1,200.5)	(9,066.1)	1,200.5	(17,879.2)	(6,203.5)	(5,762.7)	(3,952.5)	(1,960.5)	-
Underground	(29,345.3)	(2,634.8)	(26,710.5)	(10,678.3)	(2,395.9)	-	(1,200.5)	(8,282.4)	1,200.5	(16,032.2)	(5,488.9)	(5,109.5)	(3,852.1)	(1,581.7)	-
Surface	(2,760.5)	-	(2,760.5)	(913.5)	-	(129.8)	-	(783.7)	-	(1,847.0)	(714.6)	(653.2)	(100.4)	(378.8)	-
Recycling	(4,376.9)	(4,376.9)	-	-	-	-	-	-	-	-	-	-	-	-	-
Net other cash costs3	(383.8)	(7.3)	(376.5)	(90.6)	(34.7)	(12.6)	34.2	(41.8)	(35.7)	(285.9)	(32.4)	(37.9)	(13.3)	(243.4)	41.1
Adjusted EBITDA	9,045.1	2,142.6	6,902.5	1,594.0	430.9	51.7	521.4	1,112.9	(522.9)	5,308.5	1,841.0	3,044.5	910.0	(527.4)	40.4
Amortisation and depreciation	(5,699.7)	(1,431.4)	(4,268.3)	(760.8)	(239.0)	(2.6)	(211.7)	(514.7)	207.2	(3,507.5)	(1,126.5)	(1,404.5)	(696.2)	(256.4)	(23.9)
Interest income	415.5	51.8	363.7	158.0	57.0	2.1	8.8	96.6	(6.5)	205.7	77.6	71.1	18.4	12.5	26.1
Finance expense	(2,971.8)	(1,454.1)	(1,517.7)	(335.5)	(90.7)	-	(10.0)	(244.9)	10.1	(1,182.2)	(220.9)	(246.9)	(128.4)	(76.7)	(509.3)
Share-based payments	(231.9)	(4.9)	(227.0)	-	-	-	-	-	-	(227.0)	(2.8)	(1.8)	(1.3)	-	(221.1)
Net other4	(779.1)	(23.1)	(756.0)	(1,052.5)	(181.7)	0.7	(11.0)	(893.1)	32.6	296.5	24.1	23.4	(34.7)	(76.9)	360.6
Non-underlying items5	(6,759.1)	(70.9)	(6,688.2)	(152.4)	(9.0)	-	-	(134.9)	(8.5)	(6,535.8)	(74.9)	(50.4)	(675.3)	(3,664.7)	(2,070.5)
Royalties	(398.5)	-	(398.5)	(73.2)	(5.6)	-	(60.4)	(67.6)	60.4	(325.3)	(77.8)	(189.3)	(44.5)	(13.7)	-
Current taxation	(504.2)	(98.9)	(405.3)	(19.9)	-	(9.3)	(59.3)	(10.0)	58.7	(385.4)	(14.8)	(350.1)	(12.4)	-	(8.1)
Deferred taxation	3,450.8	2,917.0	533.8	(15.4)	(24.8)	(4.3)	(2.8)	12.7	3.8	549.2	(12.0)	61.4	245.3	1.5	253.0
Loss for the year	(4,433.1)	2,028.1	(6,461.2)	(657.7)	(62.9)	38.3	175.0	(643.0)	(165.1)	(5,803.5)	412.8	957.4	(419.1)	(4,601.8)	(2,152.8)
Attributable to:	(4,437.4)	2,028.1	(6,465.5)
Owners of the parent	(660.9)	(62.9)	35.1	175.0	(643.0)	(165.1)	(5,804.6)	412.8	957.4	(419.1)	(4,601.8)	(2,153.9)
Non-controlling interest holders	4.3	-	4.3	3.2	-	3.2	-	-	-	1.1	-	-	-	-	1.1
Sustaining capital expenditure	(1,325.6)	(226.9)	(1,098.7)	(567.6)	(190.5)	(11.0)	(222.5)	(366.1)	222.5	(531.1)	(235.0)	(210.2)	(63.1)	(8.5)	(14.3)
Ore reserve development	(3,291.6)	(538.6)	(2,753.0)	(465.0)	-	-	-	(465.0)	-	(2,288.0)	(876.1)	(876.2)	(482.0)	(53.7)	-
Growth projects	(1,481.6)	(888.3)	(593.3)	(2.3)	-	(2.3)	-	-	-	(591.0)	(44.4)	(147.1)	(0.5)	(11.7)	(387.3)
Total capital expenditure	(6,098.8)	(1,653.8)	(4,445.0)	(1,034.9)	(190.5)	(13.3)	(222.5)	(831.1)	222.5	(3,410.1)	(1,155.5)	(1,233.5)	(545.6)	(73.9)	(401.6)

1. Corporate and reconciling items represents the items to reconcile segment data to consolidated financial statement totals. This does not represent a separate segment as it does not generate mining revenue
2. Stillwater's performance is for eight months ended 31 December 2017 since acquisition
3. Net other cash costs consist of care and maintenance and other costs as detailed in profit or loss
4. Net other costs consists of loss on financial instruments, gain on foreign exchange differences, change in estimate of environmental rehabilitation obligation, and right of recovery receivable and payable, and other income. Corporate and reconciling items net other costs includes the share of results of equity-accounted investees after tax as detailed in profit or loss
5. Non-underlyingitems consists of gain on disposal of property, plant and equipment, impairments, occupational healthcare expense, restructuring costs, and transaction costs as detailed in profit or loss

.....

.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

3. Revenue

Significant accounting judgements and estimates

Revenue from PGM mining activities

The determination of PGM and PGM concentrate sales revenue from the time of initial recognition of the sale on a provisional basis through to final pricing requires management to continuously re-estimate the fair value of the price adjustment features. Management determines this with reference to estimated forward prices using consensus forecasts.

Accounting policy

Revenue from mining activities

Revenue from gold sales is measured and recognised based on the consideration specified in a contract with a customer. The Group recognises revenue from gold sales when the customer obtains control of the gold. These criteria are typically met when the gold is credited to the customer's bullion account by Rand Refinery. The transaction price is determined based on the agreed upon market price and number of ounces delivered.

Revenue from PGM concentrate and metal sales is recognised when the buyer, pursuant to a sales contract, obtains control of the mine product. The sales price is determined on a provisional basis at the date of delivery. Adjustments to the sale price occur based on movements in the metal market price, metal content quantities and penalties, which represent variable transaction price components, up to the date of final pricing. Final pricing is based on the monthly average market price in the month of settlement. The period between provisional invoicing and final pricing is typically between one and four months. Revenue on provisionally priced sales is initially recorded at the estimated fair value of the consideration receivable. The revenue adjustment mechanism embedded within provisionally priced sales arrangements has the characteristics of a commodity derivative. Accordingly, the fair value of the final sales price adjustment is re- estimated continuously and changes in fair value recognised as an adjustment to revenue in profit or loss and trade receivables in the statement of financial position. In all cases, fair value is determined with reference to estimated forward prices using consensus forecasts.

Revenue from PGM recycling consists of the sales of recycled palladium, platinum and rhodium derived from spent catalytic material. Revenue from PGM recycling also includes revenue from toll processing, which is recognised at the time the contained metals are returned to the supplier at a third party refinery.

Wheaton streaming revenue

In 2018, Wheaton Precious Metals International Limited (Wheaton International) and Sibanye-Stillwater entered into a streaming transaction. 100% of refined mined gold and 4.5% of refined mined palladium from the Stillwater operations will be delivered to Wheaton International over the life of mine of the US PGM operations. Each ounce is identified as a separate performance obligation.

In exchange for this, Wheaton International paid Sibanye-Stillwater R6,555.4 million (US$500.0 million) on 25 July 2018. In addition to the advance payment, Wheaton International currently pays Sibanye-Stillwater 18% cash based on the value of gold and palladium deliveries each month (refer to note 30 for additional detail of the monthly cash percentage). The contract will be settled by Sibanye-Stillwater delivering metal credits to Wheaton International representing underlying refined, mined gold and palladium.

The transaction price, being the advance payment and the cash payment to be received, is recognised as revenue each month when the metal credit is allocated to the appropriate Wheaton International account. It is from this date that Wheaton International has effectively accepted the metal, has physical control of the metal and has the risk and reward of the metal (i.e. control has transferred).

Revenue will be recognised over the life of mine of the US PGM operations. To the extent that the life of mine changes or other key inputs are changed (refer note 30), these changes are recognised prospectively as a cumulative catch-up in revenue in the year that the change occurs.

BTT streaming revenue

Lonmin entered into a metal streaming transaction in 2016 to deliver between 23% - 38% of 6E PGM from its bulk tailing re-treatment project (BTT) based on a weighted 6E PGM basket price. Lonmin received $50 million upfront, which was recognised as deferred revenue. Lonmin receives between $106 and $280 per ounce of 6E PGM metals based on basket price of 6E PGM for each ounce delivered. The performance obligations under the contract are satisfied through delivery of the 6E PGM metals ounces.

At acquisition of Lonmin, the Group accounted for the deferred revenue at fair value of R627.6 million under IFRS 3, including a significant financing component.

The transaction price under IFRS 15, being the advance payment and further the cash payments to be received, is recognised as revenue when the metal ounces are delivered and Lonmin no longer has physical control of the metal, which is also when the risk and rewards are transferred (i.e. control has transferred).

Revenue will be recognised over the life of the bulk tailing re-treatment project operations based on the ounces delivered. To the extent that the life of project changes or other key inputs are changed (refer note 30), these changes are recognised prospectively as a cumulative catch-up in revenue in the year that the change occurs. (refer note 38.5)

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

The sources of revenue are:

Figures in million - SA rand	2019	2018	2017
Gold mining activities	18,644.2	19,656.7	23,473.6
PGM mining activities	39,219.6	23,355.4	17,898.7
Recycling activities	14,521.2	7,442.7	4,539.3
Stream	540.4	201.6	-
Total revenue from contracts with customers	72,925.4	50,656.4	45,911.6

Revenue generated by operations are from the following geographical regions:

Figures in million - SA rand		2019	2018	2017
Southern Africa		46,222.6	34,810.3	36,750.0
United States		26,702.8	15,846.1	9,161.6
Total revenue from contracts with customers		72,925.4	50,656.4	45,911.6
Geographical location of customers
SA gold	SA PGM		US PGM

Revenue generated per product are as follows:

Figures in million - SA rand	2019	2018
Gold	18,882.1	21,434.2
PGMs1	51,504.9	27,545.7
Platinum	13,013.2	9,233.9
Palladium	28,031.0	15,282.3
Rhodium	9,338.1	2,236.0
Iridium	649.6	442.9
Ruthenium	473.0	350.6
Chrome	1,749.3	1,128.9
Nickel	617.9	383.0
Other	171.2	164.6
Total revenue	72,925.4	50,656.4

1 In line with Sibanye-Stillwater'smine-to-market PGM strategy and according to the processing agreements with Anglo American Platinum Limited (AAP), the processing arrangement for SRPM production changed from a Purchase of Concentrate arrangement (PoC) to a Toll processing arrangement (Toll arrangement) from 1 January 2019

Major customers

During 2019, total revenue from a single customer which is reported in the Group's US PGM and SA PGM operating segments, represented approximately R30,598 million. During 2018, a customer from each of the US PGM, SA PGM and SA Gold operating segments, represented R11,809 million, R13,881 million and R7,371 million of the Group's total revenue respectively.

Market risk

Foreign currency sensitivity

The SA region's revenue is sensitive to changes in the exchange rate. Stillwater's revenue (and expenses) are translated from its functional currency (US dollars) to the Group's presentation currency (SA rand) and, therefore, the Group's "presentation currency" earnings are sensitive to changes in the exchange rate. A one percentage point depreciation in the SA rand average exchange rate for the year ended 31 December 2019 of R14.46/US$ would have increased profit by approximately R50.6 million. A one percentage point appreciation in the SA rand average exchange rate for the year ended 31 December 2019 of R14.46/US$ would have decreased profit by approximately R50.6 million.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

4. Cost of sales

Accounting policy

The following accounting policies relate to some costs that are included in cost of sales:

Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be reliably estimated.

Pension and provident funds

The Group operates a defined contribution retirement plan and contributes to a number of industry-based defined contribution retirement plans. The retirement plans are funded by payments from employees and Group companies.

Contributions to defined contribution funds are expensed as incurred.

Figures in million - SA rand	Notes	2019	2018	2017
Salaries and wages		(21,215.6)	(15,710.3)	(15,323.0)
Consumable stores	21	(12,784.3)	(9,327.9)	(8,789.4)
Utilities		(6,089.3)	(5,049.2)	(4,930.1)
Mine contracts		(3,566.4)	(3,197.6)	(2,956.9)
Recycling1		(13,968.6)	(7,196.5)	(4,376.9)
Other		(1,878.0)	(4,564.0)	(3,398.0)
Ore reserve development costs capitalised		3,401.8	3,530.3	3,291.6
Cost of sales, before amortisation and depreciation		(56,100.4)	(41,515.2)	(36,482.7)
Amortisation and depreciation	12,13	(7,214.1)	(6,613.8)	(5,699.7)
Total cost of sales		(63,314.5)	(48,129.0)	(42,182.4)

1 Recycling cost consists of cost relating to the purchasing of spent catalytic material and the cost incurred to convert the spent catalytic material into finished PGMs

The SA region employees are members of various defined contribution retirement plans. The cost of providing retirement benefits for the year amounted to R1,233.7 million (2018: R919.1 million and 2017: R959.9 million).

5. Finance expense

Accounting policy

Finance expense comprises interest on borrowings, lease liabilities, environmental rehabilitation obligation, occupational healthcare obligation, deferred payment and deferred revenue and offset by borrowing costs capitalised on qualifying assets.

Interest payable on borrowings is recognised in profit or loss over the term of the borrowings using the effective interest method. Cash flows from interest paid are classified under operating activities in the statement of cash flows.

Figures in million - SA rand	Notes	2019	2018	2017
Interest charge on:
Borrowings - interest		(1,444.9)	(1,572.5)	(2,091.9)
Borrowings - accrued interest and unwinding of amortised cost		(374.4)	(538.3)	(251.8)
Lease liabilities	27	(33.9)	-	-
Environmental rehabilitation obligation	28	(578.7)	(398.8)	(357.1)
Occupational healthcare obligation	29	(115.5)	(105.4)	(46.4)
Deferred Payment (related to the Rustenburg operation acquisition)	20.2	(179.0)	(200.4)	(148.2)
Dissenting shareholders	20.2	(21.2)	(68.1)	(62.9)
Deferred revenue1	30	(352.3)	(160.3)	-
Deferred consideration (related to Pandora acquisition)	20.2	(40.5)	-	-
Other		(162.1)	(90.9)	(13.5)
Total finance expense		(3,302.5)	(3,134.7)	(2,971.8)

1 For the year ended 31 December 2019, interest expense includes R352.3 million (2018: R160.3 million) of non-cash interest expense relating to streaming arrangements. Although there is no cash financing cost related to this arrangement, IFRS 15 requires the Group to recognise a notional financing charge due to the significant time delay between receiving the upfront streaming payment and satisfying the related performance obligations. A discount rate of 4.6% and 5.2% was used for the Wheaton palladium and gold stream respectively and 11.5% was used for the BTT stream in determining the finance costs to be recognised as part of the steaming transactions entered into

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

6. Share-based payments

Accounting policy

The Group operates an equity-settled compensation plan in which certain employees of the Group participate. The fair value of the equity- settled instruments is measured by reference to the fair value of the equity instrument granted.

Fair value is based on market prices of the equity-settled instruments granted, if available, taking into account the terms and conditions upon which those equity-settled instruments were granted. Fair value of equity-settled instruments granted is estimated using appropriate valuation models and appropriate assumptions at the grant date. Non-market vesting conditions (service period prior to vesting) are not taken into account when estimating the fair value of the equity-settled instruments at grant date. Market conditions are taken into account in determining the fair value at grant date.

The grant date fair value of the equity-settled instruments is recognised as an employee benefit expense over the vesting period based on the Group's estimate of the number of instruments that will eventually vest, with a corresponding increase in the share-based payment reserve. Vesting assumptions for non-market conditions are reviewed at each reporting date to ensure they reflect current expectations.

The Group also operates a cash-settled compensation plan in which certain employees of the Group participate. In terms of the Rustenburg operation acquisition, the Group issued cash-settled instruments to black economic empowerment (BEE) shareholders. The grant date fair value of the cash-settled instruments is equal to the value of the equity-settled instrument granted on the same grant date.

The grant date fair value of the cash-settled instruments is recognised as an employee benefit expense or share-based payment on the BEE transaction over the vesting period based on the Group's estimate of the number of instruments that will eventually vest, with a corresponding increase in the share-based payment obligation. At each reporting date the obligation is remeasured to the fair value of the instrument, to reflect the potential outflow of cash resources to settle the liability, with a corresponding adjustment to gain or loss on financial instrument in profit or loss. Vesting assumptions for non-market conditions are reviewed at each reporting date to ensure they reflect current expectations.

Where the terms of an equity-settled or a cash-settled award are modified, the originally determined expense is recognised as if the terms had not been modified. In addition, an expense is recognised for any modification, which increases the total fair value of the share-based payment arrangement, or is otherwise beneficial to the participant as measured at the date of the modification.

Share based payment expense for the year consisted of the following:

Figures in million - SA rand	Notes	2019	2018	2017
Sibanye-Stillwater 2017 Share Plan (equity-settled scheme)	6.1	(194.4)	(139.2)	(9.0)
Performance shares		(194.4)	(139.2)	(9.0)
Sibanye Gold Limited 2013 Share Plan (equity-settled scheme)	6.1	(95.9)	(142.5)	(208.4)
Performance shares		(95.9)	(142.5)	(186.3)
Bonus shares		-	-	(22.1)
Sibanye Gold Limited Phantom Share Scheme		-	-	(11.2)
Stillwater (cash-settled scheme)		(8.9)	(14.5)	(3.3)
DRDGOLD (cash-settled scheme)1		(64.1)	(3.2)	-
Total share-based payment expense		(363.3)	(299.4)	(231.9)

1 The DRDGOLD share-based payment expense represents a cash-settledlong-term incentive scheme in which phantom shares were issued. The increase in expense relates mainly to the remeasurement of the cash-settled liability over the vesting period and an increase in the seven day volume weighted average price of the DRDGOLD share price

6.1 Sibanye-Stillwater Share Plans

On 21 November 2012, the shareholders of Sibanye-Stillwater approved the adoption of the Sibanye Gold Limited 2013 Share Plan (2013 Share Plan) with effect from the date of the listing of Sibanye Gold Limited. The 2013 Share Plan provided for two methods of participation, namely Bonus Shares and Performance Shares. This plan sought to attract, retain, motivate and reward participating employees on a basis which seeks to align the interest of such employees with those of the shareholders. On 23 May 2017, the shareholders of Sibanye- Stillwater approved the adoption of the Sibanye-Stillwater 2017 Share Plan (2017 Share Plan) on essentially similar terms to the 2013 Share Plan. At the annual general meeting (AGM) on 30 May 2018, the directors of Sibanye-Stillwater were authorised to issue and allot all or any of such shares required for the 2017 Share Plan, up to a maximum not exceeding 86,748,850 shares. Under the 2017 Share Plan, an individual participant may not be awarded an aggregate of shares exceeding 8,674,885 shares.

Bonus Shares - as part of the short-term incentive

The Remuneration Committee makes an annual award of Bonus Shares to eligible participants as a share-based component of the short- term incentive scheme.

The total annual bonus is determined by reference to the actual performance rating of the individual against predetermined targets for the preceding cycle and is comprised of cash plus the face value of restricted Bonus Shares in the ratio of 60:40.

In other words, 40% of the annual bonus is awarded using Company shares as the "currency", as opposed to cash, access to which is deferred. As such, the Bonus Shares vest in two equal tranches, nine months and 18 months after the award date. Except for the right to dispose of the shares, participants have full shareholder rights in the unvested Bonus Shares during the restricted period, including the right to receive dividends.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

The number of shares awarded is determined by dividing the face value of the Bonus Shares portion of the annual bonus by the volume- weighted average price (VWAP) of the Company's shares over the three days immediately prior to the award date.

Performance Shares - for the long-term incentive

The Remuneration Committee makes an annual award of Performance Shares to eligible participants as part of its long-term incentive scheme. The number of Performance Shares awarded to an employee is based on the employee's annual guaranteed pay and job grade combined with a factor related to the employee's assessed performance rating for the prior year and using the relevant share price calculation (as for the Bonus Shares) at the award date, with ultimate vesting of those awards subject to performance conditions as approved by the Remuneration Committee.

Performance conditions applicable to Performance Share awards from March 2016 onwards

Due to concerns expressed by shareholders during 2015, a review was conducted to identify appropriate adjustments to the methodology for determining the performance conditions on Performance Shares to be reflective of the Group's evolving strategic market position and to enhance alignment with shareholder interests.

With effect from March 2016, in respect of the award of Performance Shares at that time and at any time thereafter (subject to any future agreed changes), an updated methodology was approved by the Remuneration Committee regarding the performance conditions applicable to the determination of the amount of Performance Shares that will vest at the end of the vesting period (currently three years from the date of the award).

Essentially the number of shares that vest depends on the extent to which Sibanye-Stillwater has performed over the intervening three year period relative to two performance criteria, Total Shareholder Return (TSR) and Return on Capital Employed (ROCE). These are among the most widely acceptable vesting performance measures suited to aligning the outcome of long-term share incentive awards with shareholders' interests.

In addition, at the sole discretion of the Remuneration Committee, up to 20% of the determined number of vesting shares using the two performance criteria is liable to Bonus in the event of any extreme environmental, social, and governance (ESG) incidents occurring during the vesting period.

The number of the Performance Shares awarded that will finally vest three years after the award will range between 0% and 100% dependent on the extent to which the two performance criteria have been met and whether the Remuneration Committee has applied its further discretion to reduce the award on the basis mentioned above.

The details of these two performance conditions are provided below.

Total Shareholder Return (TSR) - 70% Weighting

TSR has been widely recognised as an appropriate indicator of shareholder value creation. It is used extensively internationally and increasingly in South Africa, sometimes as a single metric but most often as one of two or three weighted performance metrics. In some company share plans, an absolute target is set, but more often it is referenced in relation to the company's share price relative to those of a group of peers or 'comparator companies'.

In Sibanye-Stillwater's case, the TSR element is measured against a benchmark of eight peer group mining and resource companies that can be deemed to collectively represent an alternative investment portfolio for Sibanye-Stillwater's shareholders (Peer Group). The Peer Group comprises similar market capitalisation companies that are reflective of the expected positioning of Sibanye-Stillwater over the medium term as a value driven multi-commodity resources company with a specific focus on gold and platinum.

The Peer Group is set out in the table below.

Peer group companies for TSR comparison

AngloGold Ashanti Limited (AngloGold Ashanti)

Anglo American Platinum Limited (Anglo American Platinum)

Gold Fields Limited (Gold Fields)

Impala Platinum Holdings Limited

Northam Platinum Limited

Exxaro Resources Limited

Harmony Gold Mining Company Limited (Harmony)

African Rainbow Minerals Limited

Sibanye-Stillwater's TSR over the vesting period is compared with the Peer Group TSR curve constructed on a market capitalisation weighted basis in the following manner. The annualised TSR over the vesting period (TSRANN) is determined for each of the companies in the Peer Group. The Peer Group companies are sorted from lowest to highest TSRANN. The average market capitalisation based on daily closing price is determined for each company, and each peer company is assigned its proportion of the overall average market capitalisation of the Peer Group. The peer company TSR curve is plotted at the midpoint of each company's percentage of Peer Group market capitalisation on a cumulative basis above the worse performing companies in the Peer Group. In the event that one or more of the peer companies become ineligible for comparison, a peer company curve based on the companies remaining in the Peer Group is utilised.

The cumulative position of Sibanye-Stillwater's TSRANN is then mapped onto the TSR curve for the Peer Group to determine the percentile at which Sibanye-Stillwater performed over the vesting period. The performance curve governing vesting is set out in the table below with linear interpolation applied between the indicated levels.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

TSR element of performance conditions
Percentile on peer group TSR curve	% vesting
0%	0%
10%	0%
20%	0%
30%	5%
40%	20%
50%	35%
60%	55%
70%	75%
80%	90%
90%	100%
100%	100%

Return On Capital Employed (ROCE) - 30% Weighting

ROCE is a profitability metric that measures how efficiently a company generates profits from its capital employed. There is an increased focus on measuring the returns earned by businesses on the capital deployed by shareholders over and above the steady low risk returns typically available on financial markets.

For Sibanye-Stillwater, ROCE is evaluated against the company's cost of equity (Ke). A minimum threshold on the performance scale for ROCE is set as equalling the cost of equity, Ke, which would lead to the ROCE element contributing 0% towards the performance condition. Delivering a return that exceeds Ke by 6% or more would be regarded as a superior return representing the maximum 100% on the performance scale and full vesting in respect of the ROCE element. The performance curve governing vesting is set out in the table below, with linear interpolation between the indicated levels.

ROCE element of performance condition

Annual ROCE

≤Ke

Ke + 1%

Ke + 2%

Ke + 3%

Ke + 4%

Ke + 5%

Ke + 6%

• vesting 0.0%

16.7%

33.3%

50.0%

66.7%

83.3%

100.0%

The overall vesting is determined by applying the TSR performance condition to 70% of awarded shares element and the ROCE performance condition to 30% of awarded shares - plus any further discretionary reduction in the award based on the Remuneration Committee's judgement regarding ESG issues mentioned above.

Share awards granted, exercised and forfeited

Refer to the table below for the inputs to the valuation models for share awards granted during the year.

Share awards from March 2016 onwards

The performance criteria used to govern the vesting of Performance Shares are determined by the Remuneration Committee and communicated in award letters to participants. The revised performance conditions, as described above, applied with the indicated weightings, were implemented for determining the vesting of future awards effective from March 2016 onwards.

As indicated, the performance criteria described above govern vesting of all share awards effective from 1 March 2016. Should any further adjustment be made these will govern future offers but will not be applied retrospectively.

The inputs to the valuation model for shares awards granted during the year were as follows:

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

	Performance				Bonus
	shares				shares
2017	2018		2019	MONTE CARLO SIMULATION	2019	2018	2017
				Weighted average historical volatility (based on a
				statistical analysis of the share price on a weighted
53.96%	55.71%		54.82%	moving average basis for the expected term of the	n/a	50.35%	53.96%
	option)
3	3		3	Expected term (years)	n/a	n/a	n/a
n/a	n/a		n/a	Expected term (months)	9 - 18	9 - 18	9 - 18
4.65%	3.64%		1.22%	Expected dividend yield	0%	2.14% / 2.30%	4.65%
7.40%	6.90%		7.19%	Weighted average three-yearrisk-free interest rate	7.06% / 7.07%	6.87% / 6.77%	7.24%
	(based on SA interest rates)
n/a	n/a		n/a	Marketability discount	n/a	n/a 1.27% / 0.50%
24.07	6.86		11.17	Weighted average fair value	15.58	11.43	24.84 / 24.14

Share awards granted, exercised and forfeited under the 2017 Share Plan

The compensation cost related to share awards not yet recognised under the plan at 31 December 2019 amounts to R363.8 million and is to be spread over three years.

	Performance				Bonus
	shares				shares
2017	2018		2019	Number of instruments	2019	2018	2017
-	12,953,888		48,535,348	Outstanding at beginning of the year	3,269,210	-	-
			30,512,439	Movement during the year:	3,994,507
2,376,742	41,103,872		Granted during the year	5,977,437	-
10,933,066	-		-		-	-	-
	Supplementary awards related to the SGL 2013 Plan
(105,449)	(1,457,586)		-	Exercised and released	(5,823,174)	(2,348,445)	-
(250,471)	(3,995,018)		(765,896)	Forfeited	(917,461)	(359,782)	-
-	(69,808)		(10,045,449)		2,059,407	-	-
	Condition forfeited
12,953,888	48,535,348		68,236,442	Outstanding at end of the year	2,582,489	3,269,210	-

Share awards granted, exercised and forfeited under the 2013 Share Plan

The compensation cost related to awards not yet recognised under the plan at 31 December 2019 amounts to R17.2 million and is to be spread over three years.

Performance shares			Bonus shares
2017	2018	2019	Number of instruments	2019	2018	2017
10,610,779	19,379,386	15,215,982	Outstanding at beginning of the year	-	446,469	250,827
		-	Movement during the year:	-
12,851,131	-	Granted during the year	-	2,421,522
(2,616,050)	(2,523,162)	(467,017)	Exercised and released	-	(415,579)	(2,126,415)
(1,466,474)	(1,514,145)	(3,602,595)	Forfeited	-	(30,890)	(99,465)
-	(126,097)	11,090	Condition forfeited	-	-	-
19,379,386	15,215,982	11,157,460	Outstanding at end of the year	-	-	446,469

Directors and prescribed officers' equity-settled instruments

The directors and prescribed officers of Sibanye-Stillwater held the following equity-settled instruments in the above 2017 Share Plan and

2013 Share Plan at 31 December 2019:

	2018	Instruments	Equity-settled instruments	Instruments	2019
		granted	exercised during the year	forfeited
	Number of	Number of	Number of	Average	Share	Number of	Number of
	proceeds
	instruments	instruments	instruments	price	instruments	instruments
					(rand)
Executive directors
Neal Froneman	7,765,494	3,302,443	552,074	22.40	12,368,821	868,300	9,647,563
Charl Keyter	3,891,588	1,460,066	267,654	22.51	6,026,128	394,554	4,689,446
Prescribed officers							3,976,014
Chris Bateman	2,377,917	1,831,070	232,973	24.32	5,666,514	-
Shadwick Bessit	1,713,797	613,949	160,409	21.74	3,487,293	238,480	1,928,857
Hartley Dikgale	1,734,599	735,088	130,027	22.52	2,927,623	183,696	2,155,964
Dawie Mostert	2,039,260	810,486	150,643	22.40	3,373,689	236,555	2,462,548
Themba Nkosi	1,605,157	749,968	115,670	24.02	2,778,700	76,259	2,163,196
Wayne Robinson	2,082,811	898,669	146,629	22.44	3,290,222	254,904	2,579,947
Richard Stewart	2,428,496	940,812	162,656	22.81	3,709,672	249,433	2,957,219
Robert van Niekerk	3,121,139	1,308,919	231,063	22.42	5,179,367	274,278	3,924,717

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

6.2 Share-based payment on BEE transaction

In terms of the Rustenburg operation Transaction, a 26% equity stake in SRPM was acquired by the BBBEE SPV (the BBBEE Transaction) by a vendor financed facility from Sibanye Platinum Proprietary Limited (Sibanye Platinum), on the following terms:

• Interest at up to 0.2% above Sibanye-Stillwater's highest cost of debt;
• Post payment of the annual Deferred Payment to Rustenburg Platinum Mines Limited (RPM) and in respect of any repayment by SRPM of shareholder loans or the distribution of dividends, 74% will be paid to Sibanye Platinum and 26% to BBBEE SPV;
• Of the 26% payment to BBBEE SPV, 85% will be used to service the facility owing by BBBEE SPV to Sibanye Platinum;
• The remaining 15% of any such payment or 100%, once the facility owing by BBBEE SPV to Sibanye Platinum is repaid, will be declared by BBBEE SPV as a dividend to the BBBEE SPV shareholders; and
• The facility will be capped at R3,500 million.

The IFRS 2 expense has been limited to 44.8% of the 26% interest relating to Bakgatla-Ba-Kgafela Investment Holdings and Siyanda Resources Proprietary Limited, as the Rustenburg Mine Community Trust and Rustenburg Mine Employees Trust are controlled and consolidated by Sibanye-Stillwater. The 44.8% interest was based on the expected discounted future cash flows of the expected PGM reserves and costs to extract the PGMs.

6.3 Share-based payment obligations

Figures in million - SA rand	2019	2018	2017
Share-based payment on BEE transaction	1,367.6	149.7	399.5
Share-based payment	57.5	76.0	35.0
Balance at end of the year	1,425.1	225.7	434.5
Reconciliation of the share-based payment obligations	225.7
Balance at beginning of the year	434.5	481.7
Share-based payments expense	73.0	17.7	14.5
Fair value loss/(gain) on obligations1	1,217.9	(249.9)	171.5
Cash-settledshare-based payments paid2	(90.9)	(21.7)	(433.6)
Share-based payment obligation on acquisition of subsidiary	-	45.1	200.4
Foreign currency translation	(0.6)	-	-
Balance at end of the year	1,425.1	225.7	434.5
Reconciliation of the non-current and current portion
of the share-based payment obligation:	1,425.1
Share-based payment obligations	225.7	434.5
Current portion of share-based payment obligations	(82.1)	(56.8)	(12.3)
Non-current portion of share-based payment obligations	1,343.0	168.9	422.2

1. The fair value adjustment at reporting date is included in loss on financial instruments in profit or loss and not as part of share-based payments expense
2. Payments made during the year relates to vesting of shares to employees

7.1 Other costs

Figures in million - SA rand	2019	2018	2017
Included in other costs are the following:	(765.9)
Care and maintenance	(576.5)	(249.2)
Change in estimate of environmental rehabilitation obligation,	(88.9)	66.6	(248.9)
and right of recovery receivable and payable	(402.3)
Strike related costs	(31.7)	-
Service entities costs	(129.9)	102.0	-

7.2 Restructuring cost

Restructuring costs of R1,252 million (2018: R143 million) were incurred in 2019 and included voluntary separation packages. The restructuring costs mainly related to the SA gold operations and the Marikana operations and amounted to R357 million and R867 million respectively.

Sibanye-Stillwater Annual Financial Report 2019

67

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

8.	Impairments
	Figures in million - SA rand	Notes	2019	2018	2017
	Impairment of property, plant and equipment	12	(5.1)	(2,603.3)	(4,303.4)
	Impairment of goodwill	14	(54.3)	(436.3)	(99.1)
	Impairment of equity-accounted investee		(12.3)	-	-
	Impairment of loan to equity-accounted investee		(14.3)	(1.8)	(8.5)
	Total impairments		(86.0)	(3,041.4)	(4,411.0)

31 December 2019

Impairment of Qinisele Resources

The goodwill that arose on the acquisition of Qinisele Resources cannot be attributed to any current Sibanye-Stillwater operating cash generating units (refer note 14.3). Qinisele Resources will perform an internal corporate function, mostly responsible for identifying, assessing and executing corporate actions. The business acquired will not generate external cash flows and has no future external mandates. Due to the factors mentioned, the recoverable amount of goodwill resulting from the application of IFRS 3 has been calculated at zero and fully impaired at year-end.

31 December 2018

Impairment of Driefontein, Kloof and Beatrix mining assets and goodwill

Ore body constraints, above inflation electricity price and wage increases at the SA gold operations have impacted the sustainability of certain shafts and resulted in these shafts being marginal to loss making. Ongoing efforts to restore these to profitability have proven to be unsuccessful. These profitability challenges were compounded during the year by operational disruptions in 2018 including the interruption of Eskom power at the Beatrix operations in February and seismic events at Driefontein and Kloof which affected access to mining areas, thereby impacting operational flexibility. Ongoing losses experienced at the Driefontein and Beatrix operations negatively affected group cash flow as well as the sustainability and economic viability of other operations in the SA region. As a result a decision was taken during the six months ended 31 December 2018, to impair the mining assets of and goodwill allocated to Driefontein by R2,171.8 million and R166.9 million, respectively, goodwill allocated to Kloof by R165.5 million, and mining assets of and goodwill allocated to Beatrix by R166.9 million and R103.9 million, respectively. These impairments were based on the estimated fair value less cost to sell over the life of mine calculated as expected discounted cash flows from the expected gold reserves and costs to extract the gold.

Impairment of Burnstone mine development assets

Development of the Burnstone project is deferred to 2020 and as a result a decision was taken at 31 December 2018 to impair the mine development assets of Burnstone by R193.6 million. This impairment was based on the estimated fair value less cost to sell over the life of mine calculated as expected discounted cash flows from the expected gold reserves and costs to extract the gold.

31 December 2017

Impairment of Cooke Operations and Beatrix West mining assets

Ongoing losses experienced at the Cooke 1, 2 and 3 Operations and Beatrix West mine negatively affected group cash flow as well as the sustainability and economic viability of other operations in the SA region. In this regard, after numerous attempts to address the losses, it became necessary to enter into consultations in terms of Section 189A of the Labour Relations Act, 66 of 1995 (Section 189A) with relevant stakeholders regarding restructuring at the SA gold operations. As a result a decision was taken during the six months ended

30 June 2017, to impair the Cooke 1, 2 and 3 mining assets by R2,187.8 million and the Beatrix West assets by R603.7 million. These impairments were based on the estimated fair value less cost to sell over the life of mine calculated as expected discounted cash flows from the expected gold reserves and costs to extract the gold.

Impairment of WRTRP exploration and evaluation assets, and allocated goodwill

On 22 November 2017, Sibanye-Stillwater announced that it has entered into various agreements with DRDGOLD to exchange selected surface gold processing assets and tailings storage facilities (TSF) for approximately 265 million newly issued DRDGOLD shares (the DRDGOLD Transaction). Following the implementation of the DRDGOLD Transaction, Sibanye-Stillwater will retain full ownership of the Cooke and Ezulwini TSFs (of 2.4Moz probable gold reserves and 54.26Mlb probable uranium reserves), and, as such, retains full exposure to the low uranium price environment without the higher gold price TSF. As a result a decision was taken during the six months ended 31 December 2017, to impair the WRTRP exploration and evaluation assets, and allocated goodwill by R1,245.1 million and R99.1 million, respectively. These impairments were based on the estimated fair value less cost to sell over the life of mine calculated as expected discounted cash flows from the expected gold and uranium reserves, and costs to extract the gold and uranium.

Sibanye-Stillwater Annual Financial Report 2019

68

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Impairment of De Bron-Merriespruit exploration and evaluation assets

No expenditure on further exploration for and evaluation of the De Bron-Merriespruit mineral resources is budgeted or planned for 2018. As a result a decision was taken to impair the De Bron-Merriespruit exploration and evaluation asset by R227.1 million.

9. Royalties, mining and income tax, and deferred tax

Significant accounting judgements and estimates

The Group is subject to income tax in South Africa, Zimbabwe, UK and the US. Significant judgement is required in determining the liability for income tax due to the complexity of legislation. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for anticipated tax audit issues based on the best estimates of whether additional taxes will be due. The Group reassesses its judgements and estimates if facts and circumstances change. Where the facts and circumstances change or when the final tax outcome of these matters are different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

The Group recognises the net future tax benefit related to deferred tax assets to the extent that it is probable that the deductible temporary differences will reverse in the foreseeable future. Assessing the recoverability of deferred tax assets requires the Group to make significant estimates related to expectations of future taxable income. Estimates of future taxable income are based on forecast cash flows from operations and the application of existing tax laws. To the extent that future cash flows and taxable income differ significantly from estimates, the ability of the Group to realise the net deferred tax assets recorded at the reporting date could be impacted.

The Group's gold mining operations are taxed on a variable rate that increases as the profitability of the operation increases. The deferred tax rate used to calculate deferred tax is based on the current estimate of future profitability when the temporary differences will reverse based on tax rates and laws that have been enacted or substantively enacted at the reporting date. Depending on the profitability of the operations, the deferred tax rate can consequently be significantly different from year to year. Calculating the future profitability of the operations is inherently uncertain and could materially change over time.

Additionally, future changes in tax laws in South Africa, United Kingdom and in the United States could limit the ability of the Group to obtain tax deductions in future periods.

Accounting policy

Income tax comprises current and deferred tax. Current tax and deferred tax is recognised in profit or loss except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income.

Current tax is measured on taxable income at the applicable statutory rate enacted or substantively enacted at the reporting date.

Deferred tax is provided on temporary differences existing at each reporting date between the tax values of assets and liabilities and their carrying amounts. Enacted and substantively enacted tax rates are used to determine future anticipated effective tax rates which in turn are used in the determination of deferred tax.

These temporary differences are expected to result in taxable or deductible amounts in determining taxable profits for future periods when the carrying amount of the asset is recovered or the liability is settled. The principal temporary differences arise from depreciation of property, plant and equipment, provisions, unutilised capital allowances and tax losses carried forward.

Deferred tax is not recognised for:

• temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss;
• temporary differences related to investments in subsidiaries, and interest in associates and joint ventures to the extent that the Group is able to control the timing of the reversal of the temporary differences and it is probable that these will not reverse in the foreseeable future; and
• taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and relate to taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.

Deferred tax assets relating to the carry forward of unutilised tax losses and/or unutilised capital allowances are recognised to the extent it is probable that future taxable profit will be available against which the unutilised tax losses and/or unutilised capital allowances can be recovered. Deferred tax assets are reviewed at each reporting date and are adjusted if recovery is no longer probable.

Unrecognised deferred tax assets are reassessed at each reporting date and recognised to the extent that it has become probable that future taxable profits will be available against which they can be utilised.

Sibanye-Stillwater Annual Financial Report 2019

69

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

9.1 Royalties

Revenue from mineral resources in South Africa are subject to the Mineral and Petroleum Resource Royalty Act 2008 (Royalty Act). The Royalty Act imposes a royalty on refined (mineral resources that have undergone a comprehensive level of beneficiation such as smelting and refining as defined in Schedule 1 of the Royalty Act) and unrefined (mineral resources that have undergone limited beneficiation as defined in Schedule 2 of the Royalty Act) minerals payable to the State. The royalty in respect of refined and unrefined minerals (which include gold refined to 99.5% and above, and PGMs) is calculated by dividing earnings before interest and taxes (EBIT) by the product of

12.5 times, in respect of refined, and 9 times, in respect of unrefined, gross revenue calculated as a percentage, plus an additional 0.5%. EBIT refers to taxable mining income (with certain exceptions such as no deduction for interest payable and foreign exchange losses) before assessed losses but after capital expenditure. A maximum royalty of 5% of mining revenue has been introduced on refined minerals and 7% on unrefined minerals. The effective rate of royalty tax payable for the year ended 31 December 2019 was approximately 0.4% (2018: 0.5% and 2017: 1.4%) of revenue at the SA gold operations and 1.3% (2018: 1.1% and 2017: 0.6%) of revenue at the SA PGM operations.

Figures in million - SA rand	2019	2018	2017
Current charge	(431.0)	(255.5)	(398.5)
SA gold revenue	(73.7)	(93.5)	(325.3)
SA PGM revenue	(357.3)	(162.0)	(73.2)
Prior year tax refund	-	42.9	-
Total royalties	(431.0)	(212.6)	(398.5)

9.2 Mining and income tax

South African statutory tax rates

Gold mining and non-mining tax

Gold mining tax is determined according to a formula which takes into account the profit and revenue attributable to mining operations. Mining taxable income is determined after the deduction of all mining capital expenditure, with the provision that this cannot result in an assessed loss. Capital expenditure amounts not deducted are carried forward as unredeemed capital expenditure to be deducted from future mining income. Accounting depreciation is ignored for the purpose of calculating mining tax. In the formula, the percentage rate of tax payable and the ratio of mining profit, after the deduction of redeemable capital expenditure, to mining revenue is expressed as a percentage.

Non-mining income consists primarily of interest income, and is taxed at the South African company tax rate of 28%.

Company tax rate

Companies, other than gold mining companies, are subject to the maximum South African company tax rate of 28%.

US statutory tax rates

On 22 December 2017, the Tax Cuts and Jobs Act was signed into legislation in the US and the tax rate changed to 21%.

The US PGM operations are subject to tax in the states of Montana, New Jersey and Pennsylvania. During the year ended 31 December 2018, the New Jersey Governor signed a number of bills that implement numerous tax changes which affected the US PGM operations. The most significant change in the law resulted in tax being calculated together on all US entities under common control (greater that 50% ownership). As a result of contract changes, US PGM operations experienced a shift of it's state tax exposure out of New Jersey, effective 15 March 2019.

Mining and income tax

The components of mining and income tax are the following:

Figures in million - SA rand	Note	2019	2018	2017
Current tax		(1,848.7)	(95.3)	(504.2)
Mining tax		(1,363.9)	(36.8)	(425.2)
Non-mining tax		3.1	(57.6)	(70.6)
Company and capital gains tax		(487.9)	(0.9)	(8.4)
Deferred tax	9.3	3,581.7	(988.5)	3,450.8
Deferred tax charge		2,030.7	306.7	879.7
Deferred tax rate adjustment1		1,551.0	(1,295.2)	2,571.1
Total mining and income tax		1,733.0	(1,083.8)	2,946.6

1 The deferred tax rate adjustment in South Africa and the US was:

Figures in million - SA rand	2019	2018	2017
South Africa	(23.1)	249.5	39.6
United States	1,574.1	(1,544.7)	2,531.5
Deferred tax rate adjustment	1,551.0	(1,295.2)	2,571.1

Sibanye-Stillwater Annual Financial Report 2019

70

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

The change in the estimated long term deferred tax rate, as a result of applying the mining tax formula at the SA gold operations, at which the temporary differences will reverse amounted to a deferred tax charge of R23.1 million for the year ended 31 December 2019 (2018: benefit of R249.5 million and 2017: benefit of R39.6 million)

During year ended 31 December 2018, the New Jersey Governor signed a number of bills that implement numerous tax changes which affected the US PGM operations. The most significant change in the law resulted in tax being calculated together on all US entities under common control (greater than 50% voting ownership). This resulted in an increase in the estimated deferred tax rate relating to the US PGM operations and a deferred tax charge of R1,544.7 million (US$107.7 million) during 31 December 2018. With contract changes during 2019, the US PGM operations experienced a shift of its state tax exposure out of New Jersey state resulting in a deferred tax rate adjustment of R1,574.1 million (benefit)

Reconciliation of the Group's mining and income tax to the South African statutory company tax rate of 28%:

Figures in million - SA rand	2019	2018	2017
Tax on loss before tax at maximum South African statutory company tax rate (28%)	364.1	402.3	2,066.3
South African gold mining tax formula rate adjustment	(192.6)	(53.0)	157.6
US statutory tax rate adjustment	205.4	19.4	57.3
Non-deductible amortisation and depreciation	(14.7)	(21.2)	(0.9)
Non-taxable dividend received	2.1	15.4	-
Non-deductible finance expense	(86.3)	(118.2)	(165.8)
Non-deductibleshare-based payments	(81.3)	(78.9)	(58.4)
(Non-deductibleloss)/non-taxable gain on fair value of financial instruments	(571.1)	136.9	(42.9)
Non-taxable gain on foreign exchange differences	-	250.3	45.0
Non-taxable share of results of equity-accounted investees	201.9	96.4	81.6
Non-deductible impairments	(21.9)	(123.2)	(1,054.9)
Non-taxable gain on acquisition	308.8	-	-
Non-deductible transaction costs	(94.4)	(110.0)	(154.6)
Tax adjustment in respect of prior periods	12.4	51.4	-
Net other non-taxable income and non-deductible expenditure	533.5	121.0	(251.7)
Change in estimated deferred tax rate	1,551.0	(1,295.2)	2,571.1
Deferred tax assets not recognised	(383.9)	(377.2)	(303.1)
Mining and income tax	1,733.0	(1,083.8)	2,946.6

9.3 Deferred tax

Figures in million - SA rand	Notes	2019	2018	2017
Included in the statement of financial position as follows:		(288.9)
Deferred tax assets		(76.9)	(206.2)
Deferred tax liabilities		6,656.8	10,153.2	8,525.2
Net deferred tax liabilities		6,367.9	10,076.3	8,319.0
Reconciliation of the deferred tax balance:		10,076.3
Balance at beginning of the year		8,319.0	4,687.2
Deferred tax recognised in profit or loss	9.2	(3,581.7)	988.5	(3,450.8)
Deferred tax recognised in other comprehensive income		-	(22.8)	(27.7)
Deferred tax on acquisition of subsidiaries	14	-	132.2	7,486.3
Foreign currency translation		(126.7)	659.4	(376.0)
Balance at end of the year		6,367.9	10,076.3	8,319.0

The detailed components of the net deferred tax liabilities which result from the differences between the amounts of assets and liabilities recognised for financial reporting and tax purposes are:

Figures in million - SA rand	2019	2018	2017
Deferred tax liabilities	9,759.5
Mining assets	11,344.4	9,642.6
Environmental rehabilitation obligation funds	682.3	507.7	600.7
Other	208.7	284.7	47.5
Gross deferred tax liabilities	10,650.5	12,136.8	10,290.8
Deferred tax assets	(1,109.2)
Environmental rehabilitation obligation	(989.2)	(840.7)
Occupational healthcare obligation	(333.3)	(302.7)	(299.7)
Other provisions	(498.5)	(464.1)	(434.0)
Financial instruments	(1,351.3)	-	-
Tax losses and unredeemed capital expenditure	(990.3)	(304.5)	(397.4)
Gross deferred tax assets	(4,282.6)	(2,060.5)	(1,971.8)
Net deferred tax liabilities	6,367.9	10,076.3	8,319.0

Sibanye-Stillwater Annual Financial Report 2019

71

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

At 31 December 2019, the Group had the following estimated amounts not recognised but available for set-off against future income:

Figures in million - SA rand	2019	2018	2017
Tax losses	63.5
Wits Gold	63.9	64.6
Ezulwini	2,156.7	2,230.2	2,591.1
Rand Uranium	1,259.4	1,132.7	886.6
DRDGOLD	26.2	37.3	-
Western Platinum Limited	839.9	-	-
Eastern Platinum Limited	539.2	-	-
Other - SA region	12.9	15.9	15.9
Total gross tax losses	4,897.8	3,480.0	3,558.2
Other deductible temporary differences	15,207.4
Burnstone	13,419.8	11,306.8
Ezulwini	3,597.4	3,208.4	2,923.7
Rand Uranium	4,200.3	4,115.7	4,045.7
DRDGOLD	494.6	602.9	-
Western Platinum Limited	7,926.6	-	-
Eastern Platinum Limited	3,123.9	-	-
Akanani	685.1	-	-
Messina Platinum Limited	2,867.5	-	-
Ridge Mining Services Proprietary Limited	677.5	715.5	499.5
Stillwater Canada Inc	1,385.4	1,916.4	1,550.8
Other - SA region	63.6	48.9	54.2
Other - US region	165.3	172.0	183.3
Total gross tax losses and other deductible temporary differences	45,292.4	27,679.6	24,122.2
Deferred tax assets not recognised	17.8
Wits Gold	17.9	18.1
Burnstone	4,258.1	3,757.5	3,165.9
Ezulwini	1,611.1	1,522.8	1,544.1
Rand Uranium	1,528.7	1,469.6	-
DRDGOLD	145.8	130.0	-
Western Platinum Limited	2,454.6	-	-
Eastern Platinum Limited	1,025.7	-	-
Akanani	191.8	-	-
Messina Platinum Limited	802.9	-	-
Ridge Mining Services Proprietary Limited	189.7	200.3	139.9
Stillwater Canada Inc	351.6	395.4	284.4
Other - SA region	21.5	18.1	19.6
Other - US region	37.5	53.2	70.9
Total deferred tax assets not recognised	12,636.8	7,564.8	5,242.9

These deductions are available to be utilised against income generated by the relevant tax entity and do not expire unless the tax entity concerned ceases to operate for a period of longer than one year. Under South African mining tax ring-fencing legislation, each tax entity is treated separately and as such these deductions can only be utilised by the tax entities in which the deductions have been generated.

9.4 Net tax, carbon tax and royalties receivable and payable

Figures in million - SA rand	Notes	2019	2018	2017
Included in the statement of financial position as follows:		(355.1)
Tax receivable		(483.2)	(182.8)
Tax, carbon tax and royalties payable		508.9	88.0	34.9
Net tax, carbon tax and royalties payable/(receivable)		153.8	(395.2)	(147.9)
Reconciliation of the net tax, carbon tax and royalties payable/(receivable)
balance:
Balance at beginning of the year		(395.2)	(147.9)	88.6
Royalties, carbon tax and current tax	9.1, 9.2	2,292.6	307.9	902.7
Royalties and tax paid		(1,818.9)	(542.2)	(899.3)
Royalties paid		(411.5)	(234.4)	(387.4)
Tax paid		(1,407.4)	(307.8)	(511.9)
Tax payable on acquisition of subsidiaries		68.7	4.4	(260.4)
Other		18.6	-	-
Foreign currency translation		(12.0)	(17.4)	20.5
Balance at end of the year		153.8	(395.2)	(147.9)

Sibanye-Stillwater Annual Financial Report 2019

72

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

10. Earnings per share

Accounting policy

Headline earnings is presented as an additional earnings number allowed by IAS 33 Earnings per Share (IAS 33) and is calculated based on the requirements set out in SAICA Circular 1/2019 (Circular). Earnings, as determined in IAS 33, is the starting point and certain remeasurements net of related tax (current and deferred) and non-controlling interest are excluded. A remeasurement is an amount recognised in profit or loss relating to any change (whether realised or unrealised) in the carrying amount of an asset or liability that arose after the initial recognition of such asset or liability.

10.1 Basic earnings per share

Basic EPS is calculated by dividing the profit or loss attributable to owners of Sibanye-Stillwater by the weighted average number of ordinary shares in issue during the year.

	2019	2018	2017
Weighted average number of shares	2,670,029
Ordinary shares in issue ('000)	2,266,261	2,168,721
Bonus element of the capitalisation issue ('000)	-	-	86,749
Adjustment for weighting of ordinary shares in issue ('000)	(162,446)	(2,404)	(321,620)
Weighted average number of shares ('000)	2,507,583	2,263,857	1,933,850
Profit attributable to owners of Sibanye-Stillwater (SA rand million)	62.1	(2,499.6)	(4,437.4)
Basic EPS (cents)	2	(110)	(229)

10.2 Diluted earnings per share

Diluted EPS is calculated by dividing the profit attributable to owners of Sibanye-Stillwater by the diluted number of ordinary shares in issue during the year.

Dilutive shares are the number of potentially dilutive ordinary shares that could be issued as a result of share options granted to employees under the share option schemes (refer to note 6). As at 31 December 2018 and 2017, these were anti-dilutive.

	2019	2018	2017
Diluted weighted average number of shares	2,507,583
Weighted average number of shares ('000)	2,263,857	1,933,850
Potential ordinary shares ('000)	71,372	-	-
Diluted weighted average number of shares ('000)	2,578,955	2,263,857	1,933,850
Diluted basic EPS (cents)	2	(110)	(229)

10.3 Headline earnings per share

Headline EPS is calculated by dividing the headline earnings attributable to owners of Sibanye-Stillwater by the weighted average number of ordinary shares in issue during the year.

Reconciliation of profit/(loss) attributable to owners of Sibanye-Stillwater to headline earnings:

Figures in million - SA rand	Notes	Gross	Net of tax
2019			62.1
Profit attributable to owners of Sibanye-Stillwater
Gain on disposal of property, plant and equipment		(76.6)	(57.9)
Impairments	8	86.0	66.6
Impairment recognised by equity accounted associate		21.0	21.0
Gain on acquisition	14.1	(1,103.0)	(1,103.0)
Re-measurement items, attributable to non-controlling interest			3.0
Headline earnings			(1,008.2)
Headline EPS (cents)			(40)
2018
Loss attributable to owners of Sibanye-Stillwater			(2,499.6)
Gain on disposal of property, plant and equipment		(60.2)	(47.9)
Impairments	8	3,041.4	2,530.9
Headline earnings			(16.6)
Headline EPS (cents)			(1)
2017
Loss attributable to owners of Sibanye-Stillwater			(4,437.4)
Gain on disposal of property, plant and equipment		(40.7)	(29.3)
Impairments	8	4,411.0	4,242.8
Headline earnings			(223.9)
Headline EPS (cents)			(12)

Sibanye-Stillwater Annual Financial Report 2019

73

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

10.4 Diluted headline earnings per share

Diluted headline EPS is calculated by dividing the headline earnings attributable to owners of Sibanye-Stillwater by the diluted weighted average number of ordinary shares in issue during the year.

	2019	2018	2017
Diluted headline EPS (cents)	(40)	(1)	(12)

11. Dividends

Accounting policy

Dividends are recognised as a liability on the date on which such dividends are declared.

Dividends withholding tax is a tax on shareholders receiving dividends and is applicable to all dividends paid. The Group withholds dividend tax on behalf of its shareholders at a rate of 20% on dividends paid. Amounts withheld are not recognised as part of the Group's tax charge but rather as part of the dividend paid, recognised in equity.

Cash flows from dividends paid are classified under operating activities in the statement of cash flows.

Figures in million - SA rand	2019	2018	2017
Dividend declared and paid	-	-	558.2
Dividend per share - cents	-	-	60

Dividend policy

Sibanye-Stillwater's dividend policy is to return at least 25% to 35% of normalised earnings to shareholders and after due consideration of future requirements the dividend may be increased beyond these levels. The Board, therefore, considers normalised earnings in determining what value will be distributed to shareholders. The Board believes normalised earnings provides useful information to investors regarding the extent to which results of operations may affect shareholder returns. Normalised earnings is defined as earnings attributable to the owners of Sibanye-Stillwater excluding gains and losses on financial instruments and foreign exchange differences, impairments, gain on disposal of property, plant and equipment, occupational healthcare expense, restructuring costs, transactions costs, share-based payment on BEE transaction, gain on acquisition, other business development costs, share of results of equity-accounted investees, after tax, and changes in estimated deferred tax rate.

In line with Sibanye-Stillwater's strategic priority of deleveraging, the Board of Directors resolved not to pay a final dividend. Reconciliation of profit/(loss) attributable to the owners of Sibanye-Stillwater to normalised earnings:

Figures in million - SA rand	2019	2018	2017
Profit/(loss) attributable to the owners of Sibanye-Stillwater	62.1	(2,499.6)	(4,437.4)
Adjusted for:	6,015.1
Loss/(gain) on financial instruments	(1,704.1)	1,114.4
Gain on foreign exchange differences	(325.5)	(1,169.1)	(292.4)
Gain on disposal of property, plant and equipment	(76.6)	(60.2)	(40.7)
Impairments	86.0	3,041.4	4,411.0
Gain on acquisition	(1,103.0)	-	-
Restructuring costs	1,252.4	142.8	729.8
Transaction costs	447.8	402.5	552.1
Gain on derecognition of borrowings and derivative financial instrument	-	(230.0)	-
Occupational healthcare expense	(39.6)	15.4	1,106.9
Other	-	18.7	52.7
Change in estimated deferred tax rate	(1,551.0)	1,295.2	(2,571.1)
Share of results of equity-accounted investees after tax	(721.0)	(344.2)	(291.6)
Tax effect of the items adjusted above	(1,643.8)	(345.7)	(813.4)
NCI effect of the items listed above	(42.7)	-	-
Normalised earnings1	2,360.2	(1,436.9)	(479.7)

1 Normalised earnings is a pro forma performance measure and is not a measure of performance under IFRS, may not be comparable to similarly titled measures of other companies, and should not be considered in isolation or as alternatives to profit before tax, profit for the year, cash from operating activities or any other measure of financial performance presented in accordance with IFRS.

12. Property, plant and equipment

Significant accounting judgements and estimates

Carrying value of property, plant and equipment

All mining assets are amortised using the units-of-production method where the mine operating plan calls for production from proved and probable Mineral Reserves.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Mobile and other equipment are depreciated over the shorter of the estimated useful life of the asset or the estimate of mine life based on proved and probable Mineral Reserves.

The calculation of the units-of-production rate of amortisation could be impacted to the extent that actual production in the future is different from current forecast production based on proved and probable Mineral Reserves. This would generally result from the extent that there are significant changes in any of the factors or assumptions used in estimating Mineral Reserves.

These factors could include:

• changes in proved and probable Mineral Reserves;
• differences between actual commodity prices and commodity price assumptions;
• unforeseen operational issues at mine sites;
• changes in capital, operating, mining, processing and reclamation costs, discount rates and foreign exchange rates; and
• changes in Mineral Reserves could similarly impact the useful lives of assets depreciated on a straight-line basis, where those lives are limited to the life of the mine.

The recoverable amounts of cash generating units (CGUs) and individual assets have been determined based on the higher of value-in- use calculations and fair value less cost to sell. These calculations require the use of estimates and assumptions. It is reasonably possible that the gold and PGM price assumptions may change which may then impact the Group estimated life of mine determinant and may then require a material adjustment to the carrying value of property, plant and equipment.

The Group reviews and tests the carrying value of assets when events or changes in circumstances suggest that the carrying amount may not be recoverable by comparing expected future cash flows to these carrying values. Assets are grouped at the lowest level for which identifiable cash flows are largely independent of cash flows of other assets and liabilities. If there are indications that impairment may have occurred, estimates are prepared of expected future cash flows of each group of assets. Expected future cash flows used to determine the value in use and fair value less costs to sell of property, plant and equipment are inherently uncertain and could materially change over time. They are significantly affected by a number of factors including reserves and production estimates, together with economic factors such as spot and future gold and PGM prices, discount rates, foreign currency exchange rates, estimates of costs to produce reserves and future capital expenditure.

Pre-production

The Group assesses the stage of each mine construction project to determine when a mine moves into the production stage. The criteria used to assess the start date are determined based on the unique nature of each mine construction project. The Group considers various relevant criteria to assess when the mine is substantially complete, ready for its intended use and moves into the production stage. Some of the criteria would include, but are not limited to the following:

• the level of capital expenditure compared to the construction cost estimates;
• ability to produce metal in saleable form (within specifications); and
• ability to sustain commercial levels of production of metal.

When a mine construction project moves into the production stage, the capitalisation of certain mine construction costs ceases and costs are expensed, except for capitalisable costs related to mining asset additions or improvements, underground mine development or ore reserve development.

Mineral Reserves estimates

Mineral Reserves are estimates of the amount of product that can be economically and legally extracted from the Group's properties. In order to calculate the reserves, estimates and assumptions are required about a range of geological, technical and economic factors, including but not limited to quantities, grades, production techniques, recovery rates, production costs, transport costs, commodity demand, commodity prices and exchange rates.

Estimating the quantity and grade of the Mineral Reserves requires the size, shape and depth of ore bodies to be determined by analysing geological data such as the logging and assaying of drill samples. This process may require complex and difficult geological judgements and calculations to interpret the data.

The Group is required to determine and report, inter alia, on the Mineral Reserves in accordance with the South African Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves (SAMREC Code).

Estimates of Mineral Reserves may change from period to period due to the change in economic assumptions used to estimate Mineral Reserves and due to additional geological data becoming available during the course of operations. Changes in reported proven and probable reserves may affect the Group's financial results and position in a number of ways, including the following:

• asset carrying values may be affected due to changes in estimated cash flows;
• depreciation and amortisation charges to profit or loss may change as these are calculated on the units-of production method, or where the useful lives of assets change;
• decommissioning site restoration and environmental provisions may change where changes in ore reserves affect expectations about the timing or cost of these activities; and
• the carrying value of deferred tax assets may change due to changes in estimates of the likely recovery of the tax benefits.

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Accounting policy

Mineral and surface rights

Mineral and surface rights are recorded at cost less accumulated amortisation and accumulated impairment losses. When there is little likelihood of a mineral right being exploited, or the carrying amount has exceeded its recoverable amount, impairment is recognised in profit or loss in the year that such determination is made.

Mine development and infrastructure

Mining assets, including mine development and infrastructure costs and mine plant facilities, are recorded at cost less accumulated depreciation and accumulated impairment losses.

These costs which include the purchase price of assets used in the construction of the mine, expenditure incurred to evaluate and develop new ore bodies, to define mineralisation in existing ore bodies and to establish or expand productive capacity, are capitalised until commercial levels of production are achieved, at which times the costs are amortised as set out below.

Development of ore bodies includes the development of shaft systems and waste rock removal that allows access to reserves that are economically recoverable in the future. Subsequent to this, costs are capitalised if the criteria for recognition as an asset are met. Access to individual ore bodies exploited by the Group is limited to the time span of the respective mining leases.

Land

Land is shown at cost and is not depreciated.

Other assets

Non-mining assets are recorded at cost less accumulated depreciation and accumulated impairment losses. These assets include the assets of the mining operations not included in mine development and infrastructure, borrowing costs, mineral and surface rights, land and all the assets of the non-mining operations.

Amortisation and depreciation of mining assets

Amortisation and depreciation is determined to give a fair and systematic charge in profit or loss taking into account the nature of a particular ore body and the method of mining that ore body. To achieve this, the following calculation methods are used:

• Mining assets, including mine development and infrastructure costs, mine plant facilities and evaluation costs, are amortised over the life of the mine using the units-of-production method, based on estimated proved and probable Mineral Reserves above infrastructure.
• Proved and probable Mineral Reserves reflect estimated quantities of economically recoverable reserves, which can be recovered in future from known mineral deposits.
• Certain mining plant and equipment included in mine development and infrastructure is depreciated on a straight-line basis over their estimated useful lives.
• For certain shafts, which have a short life and/or are marginal, the depreciation is accelerated based on an adjustment to the reserves for accounting purposes.

Depreciation of non-mining assets

Non-mining assets are recorded at cost and depreciated on a straight-line basis over their current expected useful lives to their residual values as follows:

• Vehicles: 5 years
• Computers: 3 years
• Furniture and equipment: 1 - 10 years

The assets' useful lives, depreciation methods and residual values are reassessed at each reporting date and adjusted if appropriate.

Impairment

Recoverability of the carrying values of long-term assets or cash generating units (CGUs) of the Group are reviewed whenever events or changes in circumstances indicate that such carrying value may not be recoverable. To determine whether a long-term asset or CGU may be impaired, the higher of value in use (defined as: the present value of future cash flows expected to be derived from an asset or CGU) or fair value less costs to sell (defined as: the price that would be received to sell an asset in an orderly transaction between market participants at the measured rate, less the costs of disposal) is compared to the carrying value of the CGU.

A CGU is defined by the Group as the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. Generally for the Group this represents an individual operating mine, including mines which are part of a larger mine complex. The costs attributable to individual shafts of a mine are impaired if the shaft is closed.

Impairment losses are recognised in profit or loss. Impairment recognised in respect of a CGU is allocated first to goodwill to that particular CGU and thereafter to the individual assets in the CGU.

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FOR THE YEAR ENDED 31 DECEMBER 2019

When any infrastructure is closed down or placed on care and maintenance during the year, any carrying value attributable to that infrastructure is impaired. Expenditure incurred on care and maintenance is recognised in profit or loss.

When the review of the events or changes in circumstances of an asset or CGU that was previously impaired indicate that such historical carrying value is recoverable, the impairment is reversed. The impairment is only reversed to such an amount that the new carrying amount does not exceed what the historical carrying amount would have been should the asset not have been impaired. Reversal of impairment losses are recognised in profit or loss. Reversal of impairment recognised in respect of a CGU is allocated to the individual assets in the CGU.

Derecognition of property, plant and equipment

Property, plant and equipment is derecognised on disposal or closure of a shaft when no future economic benefits are expected from its use or disposal. Any gain or loss on derecognition of an item of property, plant and equipment (calculated as the net proceeds from disposal and the carrying amount of the item) is recognised in profit or loss.

Exploration and evaluation expenditure

All exploration and evaluation expenditure, prior to obtaining the legal rights to explore a specific area, is recognised in profit or loss. After the legal rights to explore are obtained, exploration and evaluation expenditure, comprising the costs of acquiring prospecting rights and directly attributable exploration expenditure, is capitalised as a separate class of property, plant and equipment or intangible assets, on a project-by-project basis, pending determination of the technical feasibility and commercial viability.

The technical feasibility and commercial viability of extracting a mineral resource is generally considered to be determinable through a feasibility study and when proven reserves are determinable to exist. Upon determination of proven reserves, exploration and evaluation assets attributable to those reserves are first tested for impairment and then reclassified from exploration and evaluation assets to another appropriate class of property, plant and equipment. Subsequently, all cost directly incurred to prepare an identified mineral asset for production is capitalised to mine development assets. Amortisation of these assets commences once these assets are available for use, which is expected to be when the mine is in commercial production. These assets will be measured at cost less accumulated amortisation and impairment losses.

			Mine	Land, Exploration
			development,	mineral	and
			infrastructure	rights and	evaluation
Figures in million - SA rand	Notes	Total	and other	rehabilitation	assets
2019
Cost		99,994.6
Balance at beginning of the year		72,811.2	25,095.3	2,088.1
Additions		7,803.0	7,790.9	0.4	11.7
Change in estimates of rehabilitation assets		101.0	(99.4)	200.4	-
Disposals		(281.8)	(281.2)	(0.6)	-
Derecognition of property, plant and equipment		(2,409.9)	(695.0)	(1,714.9)	-
Transfers between classes of property, plant and equipment		-	(94.9)	94.9	-
Transfers to right-of-use assets		(18.8)	(18.8)	-	-
Assets acquired on acquisition of subsidiaries	14.1	3,158.6	3,152.1	6.5	-
Assets derecognised on loss of control of subsidiary		(62.7)	-	-	(62.7)
Foreign currency translation		(998.9)	(518.3)	(472.5)	(8.1)
Balance at end of the year		107,285.1	82,046.6	23,209.5	2,029.0
Accumulated depreciation, amortisation and impairment		45,436.4
Balance at beginning of the year		38,576.2	5,276.4	1,583.8
Amortisation and depreciation	4	7,102.4	6,275.2	788.2	39.0
Impairment	8	5.1	-	-	5.1
Disposals		(257.4)	(257.4)	-	-
Derecognition of property, plant and equipment		(2,409.9)	(695.0)	(1,714.9)	-
Transfers to right-of-use assets		(15.5)	(15.5)	-	-
Depreciation capitalised to inventory		111.4	111.4	-	-
Foreign currency translation		(167.6)	(117.4)	(47.1)	(3.1)
Balance at end of the year		49,804.9	43,877.5	4,302.6	1,624.8
Carrying value at end of the year		57,480.2	38,169.1	18,906.9	404.2

1 During the year, amortisation and depreciation on assets used in the development of the Blitz project was capitalised. As a result, additions includes non- cash additions (or amortisation and depreciation capitalised) of R85.5 million

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FOR THE YEAR ENDED 31 DECEMBER 2019

			Mine	Land, Exploration
			development,	mineral	and
			infrastructure	rights and	evaluation
Figures in million - SA rand	Notes	Total	and other rehabilitation	assets
2018
Cost		101,720.7
Balance at beginning of the year		76,529.2	21,807.9	3,383.6
Additions1		7,107.5	7,034.6	(0.5)	73.4
Change in estimates of rehabilitation assets	28	618.8	-	618.8	-
Disposals		(171.2)	(168.1)	(3.1)	-
Derecognition of property, plant and equipment2		(14,416.4)	(14,287.7)	(128.7)	-
Transfers between classes of property, plant and equipment		-	192.8	134.5	(327.3)
Assets acquired on acquisition of subsidiaries	14.4	1,443.2	1,325.0	50.0	68.2
Assets derecognised on loss of control of subsidiary		(1,322.3)	(12.5)	-	(1,309.8)
Foreign currency translation		5,014.3	2,197.9	2,616.4	200.0
Balance at end of the year		99,994.6	72,811.2	25,095.3	2,088.1
Accumulated depreciation, amortisation and impairment		50,276.1
Balance at beginning of the year		44,308.9	4,471.0	1,496.2
Amortisation and depreciation	4	6,640.6	5,900.8	739.8	-
Impairment	8	2,603.3	2,461.5	70.8	71.0
Disposals		(77.2)	(75.9)	(1.3)	-
Derecognition of property, plant and equipment2		(14,416.4)	(14,287.7)	(128.7)	-
Assets derecognised on loss of control of subsidiary		(10.9)	(10.9)	-	-
Foreign currency translation		420.9	279.5	124.8	16.6
Balance at end of the year		45,436.4	38,576.2	5,276.4	1,583.8
Carrying value at end of the year		54,558.2	34,235.0	19,818.9	504.3

1. During the year, amortisation and depreciation on assets used in the development of the Burnstone project was capitalised. As a result, additions includes non-cash additions (or amortisation and depreciation capitalised) of R26.8 million
2. During the year, short-term ore reserve development, which was capitalised up to 31 December 2016 and fully depreciated by 2018, was derecognised as no future economic benefits are expected from its use

			Mine	Land, Exploration
			development,	mineral	and
			infrastructure	rights and	evaluation
Figures in million - SA rand	Notes	Total	and other rehabilitation	assets
2017
Cost		67,689.8
Balance at beginning of the year		59,904.4	5,714.4	2,071.0
Additions1		6,140.6	5,979.1	95.3	66.2
Change in estimates of rehabilitation assets	28	(187.8)	-	(187.8)	-
Disposals		(142.3)	(134.1)	(7.9)	(0.3)
Assets acquired on acquisition of subsidiaries	14.5	29,948.6	11,513.6	17,115.2	1,319.8
Foreign currency translation		(1,728.2)	(733.8)	(921.3)	(73.1)
Balance at end of the year		101,720.7	76,529.2	21,807.9	3,383.6
Accumulated depreciation, amortisation and impairment		40,449.1
Balance at beginning of the year		38,341.9	2,107.2	-
Amortisation and depreciation	4	5,741.6	5,067.6	674.0	-
Impairment	8	4,303.4	1,504.6	1,300.3	1,498.5
Disposals		(111.7)	(534.2)	422.5	-
Foreign currency translation		(106.3)	(71.0)	(33.0)	(2.3)
Balance at end of the year		50,276.1	44,308.9	4,471.0	1,496.2
Carrying value at end of the year		51,444.6	32,220.3	17,336.9	1,887.4

1 During the year, amortisation and depreciation on assets used in the development of the Burnstone project was capitalised. As a result, additions includes non-cash additions (or amortisation and depreciation capitalised) of R41.8 million.

..

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FOR THE YEAR ENDED 31 DECEMBER 2019

13. Right-of-use assets

Accounting policy

Right-of-use assets comprise mining equipment, vehicles and office rentals (included in the mine development, infrastructure and other asset class) of which none meet the definition of investment property. These right-of-use assets comprise the initial measurement of the corresponding lease liability, any initial direct costs incurred by the lessee, and an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset. Right-of-use assets are subsequently measured at cost less accumulated depreciation and impairment losses if applicable. The assets are depreciated over the shorter period of the lease term and useful life of the underlying asset.

If a lease transfers ownership of the underlying asset, or the cost of the right-of-use asset reflects that the Group expects to exercise a purchase option, the related right-of use asset is depreciated over the useful life of the underlying asset. The depreciation starts at the commencement date of the lease.

Refer to the lease liabilities note (refer note 27) for additional detail.

Figures in million - SA rand	Notes	2019	2018	2017
Impact of adopting IFRS 16 on 1 January 2019	1.2	302.0	-	-
Additions and modifications		43.6	-	-
Right-of-use assets acquired on acquisition of subsidiaries	14.1	133.3	-	-
Depreciation		(111.7)	-	-
Transfers and other movements		(5.7)	-	-
Foreign currency translation		(0.6)	-	-
Balance at end of the year		360.9	-	-

14. Acquisitions

Significant accounting judgements and estimates

Expected future cash flows used to determine the fair value of, inter alia, property, plant and equipment and contingent consideration are inherently uncertain and could materially change over time. The fair value is significantly affected by a number of factors including reserves and production estimates, together with economic factors such as the expected commodity price, foreign currency exchange rates, and estimates of production costs, future capital expenditure and discount rates.

Accounting policy

Business combinations

The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred for the acquisition of a business is the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Any contingent consideration is measured at fair value at the date of acquisition. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.

On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree either at fair value or at the non- controlling interest's proportionate share of the acquiree's net assets. Subsequently, the carrying amount of non-controlling interest is the amount of the interest at initial recognition plus the non-controlling interest's share of the subsequent changes in equity, plus or minus changes in the portion of interest of the equity of the subsidiary not attributable, directly or indirectly, to Sibanye-Stillwater shareholders.

The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets acquired is recorded as goodwill. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference is a gain recognised directly in profit or loss.

14.1 Lonmin acquisition

On 14 December 2017, Sibanye-Stillwater announced that it had reached an agreement with Lonmin Plc (Lonmin) on the terms of a recommended all-share offer to acquire the entire issued and to be issued ordinary share capital of Lonmin (the Lonmin Acquisition). The Lonmin Acquisition was effected by means of a scheme of arrangement between Lonmin and the Lonmin shareholders under Part 26 of the UK Companies Act. Under the initial terms of the Lonmin Acquisition, each Lonmin shareholder was entitled to receive: 0.967 new Sibanye-Stillwater shares for each Lonmin share (Initial offer).

On 15 May 2018, Sibanye-Stillwater received South African Reserve Bank approval for the proposed acquisition of Lonmin and on 28 June 2018, the proposed Lonmin transaction was unconditionally cleared by the UK Competition and Markets Authority. On 21 November 2018, Sibanye-Stillwater announced that the Competition Tribunal had approved the proposed acquisition of Lonmin, subject to specific conditions. In addition to the conditions agreed between Sibanye-Stillwater and the Competition Commission, a further condition had been

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FOR THE YEAR ENDED 31 DECEMBER 2019

imposed by the Competition Tribunal, namely a moratorium on retrenchments at the Lonmin operations for a period of six months from the implementation date.

On 25 April 2019, the boards of Sibanye-Stillwater and Lonmin reached agreement on the terms of an increased recommended all-share offer pursuant to which Sibanye-Stillwater, and/or a wholly owned subsidiary of Sibanye-Stillwater, was to acquire the entire issued and to be issued ordinary share capital of Lonmin (the Increased Offer). Under the terms of the Increased Offer, Lonmin shareholders was entitled to receive one new Sibanye-Stillwater share for each Lonmin share.

The Lonmin Transaction (or scheme) was approved by the UK Court and on 7 June 2019 (effective date) and all the conditions precedent to the Lonmin Transaction were fulfilled. Sibanye-Stillwater obtained control of Lonmin on this date. The effective date of the implementation of the Lonmin Transaction was 10 June 2019, when Lonmin's listing on the Financial Conduct Authority's Official List and the trading of Lonmin shares on the London Stock Exchange's Main Market for listed securities was suspended, and 290,394,531 new Sibanye-Stillwater shares were listed on the Johannesburg Stock Exchange.

The year end of Lonmin has been changed to 31 December 2019 and Lonmin was consolidated from the effective date. For the seven months ended 31 December 2019, the Marikana operations contributed revenue of R11,188 million and a net profit of R1,881 million to the Group's results.

The purchase price allocation (PPA) on the effective date was prepared on a provisional basis in accordance with IFRS 3 Business Combinations. During the measurement period, management provisionally revised the initial PPA due to new information obtained in accordance with the IFRS 3.

Consideration

The fair value of the consideration is as follows:

Figures in million	2019
Equity instruments (290,394,531 ordinary shares)	4,306.6
Total consideration	4,306.6

Acquisition related costs

The Group incurred total acquisition related costs of R428.8 million (2019: R283.9 million, 2018: R117.2 million, 2017: R15.5 million and

prior to 2017: R12.2 million) on advisory and legal fees. These costs are recognised as transaction costs in profit or loss during the period in which incurred.

Identified assets acquired and liabilities assumed

The following table summarises the recognised amounts of assets acquired and liabilities assumed at the acquisition date:

Figures in million	Notes	2019
Property, plant and equipment	12	3,158.6
Right-of-use assets	13	133.3
Other investments		320.8
Environmental rehabilitation obligation funds	19	443.2
Other non-current assets		395.0
Inventories		5,219.5
Trade and other receivables		925.3
Other current assets		14.6
Cash and cash equivalents		2,999.3
Lease liabilities	27	(133.3)
Environmental rehabilitation obligation and other provisions	28	(1,696.9)
Other non-current liabilities		(863.0)
Borrowings	26	(2,574.8)
Trade and other payables		(2,585.7)
Other current liabilities		(99.3)
Total fair value of identifiable net assets acquired1		5,656.6

1 Fair value of assets and liabilities excluding property, plant and equipment, inventories, borrowings, non-current liabilities and environmental rehabilitation obligation approximate the carrying value

The fair value of property, plant and equipment was based on the expected discounted cash flows of the expected ore reserves and costs to extract the ore discounted at a real discount rate of 13.5% for the Marikana operations, an average platinum price of US$1,025/oz and an average palladium price of US$1,170/oz

The fair value of inventories was based on the estimated selling price less costs to complete and costs to sell

The fair value of borrowings is based on the settlement price. The Group restructured the Lonmin group entities funding arrangements to optimise financing costs. The Lonmin Pangaea Investments Management Limited (PIM) prepayment arrangement of US$174.3 million was fully settled by cash on hand and available within the Lonmin group on 5 July 2019

The fair value of other non-current liabilities is calculated based on a discounted cash flows using an effective discount rate of 12.5%

The fair value of environmental rehabilitation obligation is calculated with updated life of mines used in the discounted cash flows of property, plant and equipment

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FOR THE YEAR ENDED 31 DECEMBER 2019

Gain on acquisition

A gain on acquisition has been recognised as follows:

Figures in million	2019
Consideration	4,306.6
Fair value of identifiable net assets acquired	(5,656.6)
Non-controlling interest, based on the proportionate interest in the recognised amounts of assets and liabilities1	247.0
Gain on acquisition	(1,103.0)

1 The amount recognised as non-controlling interest represents the non-controlling interest holders' effective proportionate share in the fair value of the identifiable net assets acquired

The excess of the fair value of the net assets acquired over the consideration is recognised immediately in profit or loss as a gain on acquisition. The gain on acquisition is attributable to the transaction being attractively priced, and is consistent with the statement by the boards of Sibanye-Stillwater and Lonmin, that the purchase price reflected the recovery in PGM prices at the time of the increased offer, balanced against the fact that Lonmin, pre-acquisition, was financially constrained and unable to fund the significant investment required to sustain its business and associated employment.

14.2 SFA (Oxford) acquisition

On 21 February 2019, Sibanye-Stillwater announced it had agreed to acquire SFA (Oxford) Limited (SFA Oxford), an established analytical consulting company that is a globally recognised authority on PGMs and has for several years provided in-depth market intelligence on battery materials and precious metals for industrial, automotive, and smart city technologies.

The purchase consideration comprised an upfront payment of GBP4 million (R74.7 million) at the closing of the transaction and a deferred payment (contingent consideration), subject to a maximum payment of GBP6 million (refer note 20.2).

The acquisition was subject to the fulfilment of various conditions precedent which were completed on 4 March 2019. Sibanye-Stillwater obtained control (100%) on this date.

The PPA has been prepared on a provisional basis in accordance with IFRS 3. If new information obtained within one year of the acquisition date, about facts and circumstances that existed at the acquisition date, identifies adjustments to the below amounts or any additional provisions that existed at the date of acquisition, then the accounting for the acquisition will be revised.

Figures in million	SA rand
Consideration	127.1
Fair value of identifiable net assets acquired	(4.4)
Goodwill	122.7

The goodwill is attributable to the talent and skills of SFA (Oxford)'s workforce.

The goodwill has been allocated to the Stillwater, Rustenburg and Kroondal cash generating units (refer note 15). None of the goodwill recognised is expected to be deducted for tax purposes.

14.3 Qinisele Resources acquisition

On 29 October 2019, Sibanye-Stillwater entered in to a sale of shares agreement to buy the entire issued share capital of Qinisele Resources, a boutique advisory company that specialises in corporate finance, investor relations and research for a total of R54.8 million.

The acquisition was subject to the fulfilment of various conditions precedent which were completed on 31 October 2019 and Sibanye- Stillwater obtained control (100%) on 1 November 2019 (acquisition date).

The PPA has been prepared on a provisional basis in accordance with IFRS 3. If new information obtained within one year of the acquisition date, about facts and circumstances that existed at the acquisition date, identifies adjustments to the below amounts or any additional provisions that existed at the date of acquisition, then the accounting for the acquisition will be revised.

Figures in million	SA rand
Consideration	54.8
Fair value of identifiable net assets acquired	(0.5)
Goodwill	54.3

The goodwill is attributable to the experience and skills of Qinisele's workforce (refer note 15).

14.4 DRDGOLD acquisition

On 22 November 2017, Sibanye-Stillwater announced that it had entered into various agreements with DRDGOLD in terms of which, Sibanye-Stillwater will exchange selected surface gold processing assets and TSF (the "Far West Gold Recoveries", previously known as the WRTRP) for approximately 265 million newly issued DRDGOLD shares (the DRDGOLD Transaction), or 38.05% of the issued share capital of DRDGOLD. In addition, pursuant to the DRDGOLD Transaction, Sibanye-Stillwater has an option to subscribe for a sufficient number of DRDGOLD ordinary shares to attain a 50.1% shareholding in DRDGOLD at a 10% discount to the 30 day volume weighted average traded price.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Sibanye-Stillwater received approval for the DRDGOLD Transaction from the South African competition authorities in accordance with the Competition Act and on 19 July 2018 all the conditions precedent to the DRDGOLD Transaction were fulfilled. Sibanye-Stillwater obtained control (38.05%) of DRDGOLD on this date. The effective date of the implementation of the DRDGOLD Transaction was 31 July 2018, when Sibanye-Stillwater was issued the newly issued DRDGOLD shares.

DRDGOLD has a 30 June year end and is consolidated from 31 July 2018 based on its results to 31 December 2018. For the five months ended 31 December 2018, DRDGOLD contributed revenue of R1,047.5 million and a net loss of R39.9 million to the Group's results, before Sibanye-Stillwater Group adjustments.

Acquisition related costs

The Group incurred acquisition related costs of R25.0 million on advisory and legal fees. These costs are recognised as transaction costs in profit or loss.

Identifiable assets acquired and liabilities assumed

The following table summarises the recognised fair value of assets acquired and liabilities assumed at the acquisition date:

Figures in million	Notes	2018
Property, plant and equipment1	12	1,443.2
Environmental rehabilitation obligation funds	19	244.7
Other non-current assets		28.7
Inventories		243.5
Trade and other receivables		138.4
Cash and cash equivalents		282.8
Environmental rehabilitation obligation and other provisions	28	(672.7)
Deferred tax liabilities	9.3	(132.2)
Other non-current liabilities		(54.9)
Trade and other payables		(337.1)
Other current liabilities		(17.6)
Total fair value of identifiable net assets acquired		1,166.8

1 The fair value of property, plant and equipment was based on the expected discounted cash flows of the expected ore reserves and costs to extract the ore discounted at a real discount rate of 9.3% and an average gold price of R580,000/kg

Goodwill

Goodwill arising from the acquisition has been recognised as follows:

Figures in million	Note	SA rand
Transaction with DRDGOLD shareholders (Consideration)1		261.4
Fair value of identifiable net assets acquired		(1,166.8)
Non-controlling interest, based on the proportionate interest in the recognised amounts of assets and		940.3
liabilities2
Goodwill	15	34.9

1. The purchase consideration was calculated as 61.95% of the fair value of Far West Gold Recoveries assets and liabilities. The fair value of assets and liabilities, excluding property, plant and equipment, approximate the carrying value. The fair value of property, plant and equipment was based on the expected discounted cash flows of the expected ore reserves and costs to extract the ore discounted at a real discount rate of 13.8%, an average gold price of R580,000/kg. Although Sibanye-Stillwater exchanged (i.e. disposed) the Far West Gold Recoveries assets and liabilities, the Group effectively retains control. The transaction with DRDGOLD shareholders, therefore, represents the difference between 61.95% of the fair value and carrying value of Far West Gold Recoveries assets and liabilities
2. Non-controllinginterest was based on the proportionate interest (of 61.95%) in the carrying value of the Far West Gold Recoveries assets and liabilities, and fair value of the DRDGOLD net assets and liabilities acquired

The goodwill is attributable to DRDGOLD's proven surface retreatment capabilities.

Refer to note 15 for the allocation of goodwill. None of the goodwill recognised is expected to be deducted for tax purposes.

14.5 Stillwater acquisition

On 9 December 2016, Sibanye-Stillwater announced it had reached a definitive agreement to acquire Stillwater Mining Company (Stillwater) for US$18 per share in cash, or US$2,200 million in aggregate (the Stillwater Transaction). On 25 April 2017, at the shareholders meeting of Sibanye-Stillwater, the Sibanye-Stillwater shareholders approved the proposed Stillwater Transaction by voting in favour of the various resolutions to give effect to the Stillwater Transaction and at the shareholders meeting of Stillwater, the requisite majority of Stillwater shareholders resolved to approve the Stillwater Transaction. Sibanye-Stillwater obtained control (100%) of Stillwater on this date. The effective date of the implementation of the Stillwater Transaction was 4 May 2017, when Sibanye-Stillwater took over legal ownership of Stillwater.

For the eight months ended 31 December 2017, Stillwater contributed revenue of US$688.3 million (R9,161.6 million) and a profit of US$152.4 million (R2,028.1 million) to the Group's results.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Consideration

The consideration paid is as follows:

Figures in million	Note	US dollar	SA rand
Cash		2,080.7	27,174.5
Liability raised in respect of dissenting shareholders	20.2	104.5	1,364.3
Settlement of share-based payment awards (cash)		16.2	211.9
Total consideration		2,201.4	28,750.7

Acquisition related costs

The Group incurred acquisition related costs of R528.5 million on advisory and legal fees. These costs are recognised as transaction costs in profit or loss.

Identifiable assets acquired and liabilities assumed

The following table summarises the recognised fair value of assets acquired and liabilities assumed at the acquisition date:

Figures in million	Notes	US dollar	SA rand
Property, plant and equipment	12	2,293.2	29,948.6
Other non-current assets		6.9	90.8
Inventories		159.7	2,085.4
Current investments		278.9	3,642.2
Cash and cash equivalents		137.2	1,792.2
Other current assets		37.3	487.3
Borrowings		(454.6)	(5,937.6)
Environmental rehabilitation obligation	28	(23.9)	(312.1)
Deferred tax liabilities	9.3	(573.2)	(7,486.3)
Other non-current liabilities		(19.9)	(260.3)
Trade and other payables		(88.1)	(1,150.1)
Other current liabilities		(1.8)	(23.3)
Total fair value of identifiable net assets acquired1		1,751.7	22,876.8

1 The fair value of assets and liabilities excluding property, plant and equipment, inventories and borrowings approximate the carrying value. The fair value of property, plant and equipment was based on the expected discounted cash flows of the expected ore reserves and costs to extract the ore discounted at a real discount rate of 8.6% for the Stillwater and East Boulder mines and Columbus metallurgical complex, and 10.3% for the Blitz project, an average platinum price of US$1,375/oz and an average palladium price of US$880/oz. The fair value of borrowings (Convertible Debentures) was based on the settlement price

Goodwill

Goodwill arising from the acquisition has been recognised as follows:

Figures in million	Note	US dollar	SA rand
Consideration		2,201.4	28,750.7
Fair value of identifiable net assets		(1,751.7)	(22,876.8)
Goodwill	15	449.7	5,873.9

The goodwill is attributable to the talent and skills of Stillwater's workforce.

Refer to note 15 for the allocation of goodwill. None of the goodwill recognised is expected to be deducted for tax purposes.

15. Goodwill

Significant accounting judgements and estimates

Goodwill is tested for impairment on an annual basis and whenever impairment indicators are identified. Expected future cash flows used to determine the recoverable amount of property, plant and equipment and goodwill are inherently uncertain and could materially change over time. The recoverable amount is significantly affected by a number of factors including reserves and production estimates, together with economic factors such as the expected commodity price, foreign currency exchange rates, and estimates of production costs, future capital expenditure and discount rates.

An individual operating mine does not have an indefinite life because of the finite life of its reserves. The allocation of goodwill to an individual mine will result in an eventual goodwill impairment due to the wasting nature of the mine.

Accounting policy

Goodwill is stated at cost less accumulated impairment losses. In accordance with the provisions of IAS 36 Impairment of Assets, the Group performs its annual impairment review of goodwill at each financial year end or whenever there are impairment indicators to establish whether there is any indication of impairment to goodwill. An impairment is made if the carrying amount exceeds the recoverable

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FOR THE YEAR ENDED 31 DECEMBER 2019

amount. The recoverable amount is determined as the higher of "value in use" and "fair value less cost to sell", based on the cash flows over the life of the CGUs and discounted to present value at an appropriate discount rate. Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill allocated to the entity sold.

Goodwill is allocated to CGUs for the purpose of impairment testing. The allocation is made to those CGUs or groups of CGUs that are expected to benefit from the business combination in which the goodwill arose.

Figures in million - SA rand	Note	2019	2018	2017
Balance at beginning of the year		6,889.6	6,396.0	936.0
Impairment	8	(54.3)	(436.3)	(99.1)
Goodwill on acquisition of subsidiaries		176.9	34.9	5,873.9
Foreign currency translation		(157.3)	895.0	(314.8)
Balance at end of the year		6,854.9	6,889.6	6,396.0

The goodwill arose on the acquisition of Cooke, Aquarius, Stillwater, DRDGOLD, SFA (Oxford) and Qinisele Resources. The goodwill on acquisition of:

• SFA (Oxford), amounting to R122.7 million, is attributable to the talent and skills of SFA (Oxford)'s workforce. At year-end, the goodwill on acquisition of SFA (Oxford) is allocated to the Stillwater (R60.2 million), Rustenburg (R44.3 million) and Kroondal (R18.2 million) CGUs, where it is tested for impairment. No impairment has been recognised.
• Qinisele Resources, amounting to R54.3 million, cannot be attributed to any current Sibanye-Stillwater operating cash generating units. Qinisele Resources will perform an internal corporate function, mostly responsible for identifying, assessing and executing corporate actions. The business acquired will not generate external cash flows and has no future external mandates. None of the goodwill recognised is expected to be deducted for tax purposes. Due to the factors mentioned, the recoverable amount of goodwill resulting from the application of IFRS 3 has been calculated at zero and fully impaired at year-end (refer note 8).
• Cooke, amounting to R736.7 million, was attributable to the synergies at the Group's other operations, and the underlying assets of Cooke and WRTRP. During the year ended 31 December 2016, the goodwill allocated to the Cooke CGU was impaired by
  R201.3 million. During the year ended 31 December 2017, the goodwill allocated to the WRTRP CGU was impaired by R99.1 million. During the year ended 31 December 2018, the goodwill allocated to the Driefontein, Kloof and Beatrix CGUs was impaired by R436.3 million (refer note 8).
• Aquarius, amounting to R400.6 million, was attributable to the synergies between the PGM assets in the Rustenburg area. At year end the goodwill on acquisition of Aquarius is allocated to the Kroondal (R133.5 million) and the Rustenburg operation (R267.1 million) CGUs, where it is tested for impairment. No impairment has been recognised.
• Stillwater, amounting to R5,873.9 million (US$449.7 million), was attributable to the premium paid, and the talent and skills of Stillwater's workforce, and is allocated to the Stillwater CGU, where it is tested for impairment. No impairment has been recognised.
• DRDGOLD, amounting to R34.9 million, was attributable to DRDGOLD's proven surface retreatment capabilities, and is allocated to the DRDGOLD CGU, where it is tested for impairment. No impairment has been recognised.

The recoverable amount of goodwill was calculated based on the value in use of the CGUs to which to goodwill was allocated. None of the goodwill recognised is expected to be deducted for tax purposes.

The Group's estimates and assumptions used in the 31 December 2019 impairment testing include:

	PGM operations			Gold operations
2018	2019				2019	2018
	20,600		Long-term gold price	R/kg	686,225	585,500
15,050	R/4Eoz	Long-term PGM (4E) basket price
1,010	1,250	US$/2Eoz	Long-term PGM (2E) basket price
14.3	13.6	%	Nominal discount rate - South Africa1	%	12.4	12.6
7.0	7.6	%	Nominal discount rate - US
5.0	5.0	%	Inflation rate - South Africa	%	5.0	5.0
1.9	2.0	%	Inflation rate - US
12 - 28	13 - 35	years	Life of mine	years	6 - 18	5 - 20

1 Nominal discount rate for Burnstone and Mimosa of 17.1% and 23.3%, respectively

The cash flows are based on the annual life-of-mine plan that takes into account the following:

• proved and probable ore reserves of the CGUs;
• resources are valued using appropriate price assumptions;
• cash flows are based on the life-of-mine plan; and
• capital expenditure estimates over the life-of-mine plan.

The recoverable amounts of the operating CGUs are significantly higher than the carrying values, therefore a reasonably possible adverse change in the abovementioned assumptions would not likely result in an adjustment to the carrying values.

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FOR THE YEAR ENDED 31 DECEMBER 2019

16. Equity-accounted investments

Significant accounting judgements and estimates

Joint arrangements

Judgement is required to determine when the Group has joint control, which requires an assessment of the relevant activities and when the decisions in relation to those activities require unanimous consent. The Group has determined that the relevant activities for its joint arrangements are those relating to the operating and capital decisions of the arrangement, such as: the approval of the capital expenditure programme for each year, and appointing, remunerating and terminating the key management personnel or service providers of the joint arrangement. The considerations made in determining joint control are similar to those necessary to determine control over subsidiaries.

Judgement is also required to classify a joint arrangement as either a joint operation or a joint venture. Classifying the arrangement requires the Group to assess their rights and obligations arising from the arrangement. Specifically, it considers:

• The structure of the joint arrangement - whether it is structured through a separate vehicle.
• When the arrangement is structured through a separate vehicle, the Group also considers the rights and obligations arising from:
• • the legal form of the separate vehicle; and
  • the terms of the contractual arrangement.

This assessment often requires significant judgement, and a different conclusion on joint control and also whether the arrangement is a joint operation or a joint venture may materially impact the accounting.

Carrying value of Mimosa and related Mineral Reserves and Mineral Resources estimates

The Group reviews and tests the carrying value when events or changes in circumstances suggest that the carrying amount may not be recoverable by comparing expected future cash flows to the carrying value. Expected future cash flows used to determine the value in use and fair value less costs to sell of Mimosa are inherently uncertain and could materially change over time. These are significantly affected by a number of factors including reserves and production estimates, together with economic factors such as spot and future PGM prices, discount rates, foreign currency exchange rates, estimates of costs to produce reserves and future capital expenditure. Mineral resources outside the approved mine plans are valued based on the in situ 4E ounce value. Comparable market transactions are used as a source of evidence adjusting specifically for the nature of each underlying ore body.

Accounting policy

The Group's interest in equity-accounted investees comprise interests in associates and joint ventures.

Associates are those entities in which the Group has significant influence, but not control or joint control, over the financial and operating policies. Joint ventures are arrangements in which the Group has joint control, whereby the Group has rights to the net assets of the arrangement, rather than rights to its assets and obligations for its liabilities.

Interests in associates and joint ventures are accounted for using the equity method. The interests are initially recognised at cost using the same principles as with business combinations. Subsequent to initial recognition, the consolidated financial statements include the Group's share of profit or loss and other comprehensive income of equity-accounted investees until the date on which significant influence or joint control ceases.

Results of associates and joint ventures are equity-accounted using the results of their most recent audited annual financial statements or unaudited management accounts. Any losses from associates are brought to account in the consolidated financial statements until the interest in such associates is written down to zero. The interest includes any long-term interests that in substance, form part of the entity's net investment in the equity-accounted investee, for example long-term receivables for which settlement is neither planned nor likely to occur in the foreseeable future. Thereafter, losses are accounted for only insofar as the Group is committed to providing financial support to such associates.

The carrying value of an equity-accounted investment represents the cost of the investment, including goodwill, the proportionate share of the post-acquisition retained earnings and losses, any other movements in reserves, any impairment losses and loans to or from the equity-accounted investee. The carrying value together with any long-term interests that in substance form part of the net investment in the equity-accounted investee is assessed annually for existence of indicators of impairment and if such exist, the carrying amount is compared to the recoverable amount, being the higher of value in use or fair value less costs to sell. If an impairment in value has occurred, it is recognised in the period in which the impairment arose. Indicators of impairment include a significant or prolonged decline in the investments fair value below its carrying value.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

The Group holds the following equity-accounted investments:

Figures in million - SA rand	Notes	2019	2018	2017
Rand Refinery1	16.1	396.9	239.3	198.4
Mimosa2	16.2	2,687.7	2,492.4	2,012.9
Peregrine2	16.3	954.1	978.0	-
Other equity-accounted investments		0.1	24.2	32.8
Total equity-accounted investments		4,038.8	3,733.9	2,244.1

1. Associate
2. Joint venture

16.1 Rand Refinery

Sibanye-Stillwater has a 44.4% interest in Rand Refinery Proprietary Limited (Rand Refinery), a company incorporated in South Africa, which is involved in the refining of bullion and by-products sourced from, inter alia, South African and foreign gold producing mining companies. Rand Refinery is accounted for using the equity method.

On 18 December 2014, Rand Refinery drew down R1.029 billion under a R1.2 billion subordinated shareholders loan (the Facility), with Sibanye-Stillwater's proportional share being R384.6 million. Amounts drawn down under the Facility were repayable within two years from the first draw down date. If the loan was not repaid within two years, it would automatically convert into equity in Rand Refinery. During February 2017, Rand Refinery resolved to convert the Facility to redeemable preference shares.

There are no fixed repayment terms for the preference shares. The preference shares have a preferential right to distributions. No ordinary dividends will be declared by Rand Refinery until the preference shares have been fully redeemed. The preference shareholders do not have voting rights at shareholders' meetings. The Group accounts for the preference shares as part of the investment in Rand Refinery. The equity-accounted investment in Rand Refinery movement for the year is as follows:

Figures in million - SA rand	2019	2018	2017
Balance at beginning of the year	239.3	198.4	72.4
Share of results of equity-accounted investee after tax1	344.5	143.7	124.5
Preference shares redeemed	(186.9)	(102.8)	-
Interest income on loan to equity-accounted investee capitalised	-	-	1.5
Balance at end of the year	396.9	239.3	198.4

1 Rand Refinery is equity accounted based on its latest management accounts for the period ended 30 November, since Rand Refinery has a 31 August year- end

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FOR THE YEAR ENDED 31 DECEMBER 2019

The Group's interest in the summarised financial statements of Rand Refinery are:

Figures in million - SA rand	2019	2018	2017
Revenue	811.0	644.0	649.0
Total comprehensive income	777.0	434.0	374.0
Non-current assets	667.0	699.0	702.0
Current assets	1,433.0	1,088.0	669.0
Non-current liabilities	(111.0)	(44.0)	(31.0)
Current liabilities	(104.0)	(359.0)	(391.0)
Net assets/(liabilities) (100.0%)	1,885.0	1,384.0	949.0
Reconciliation of the total investment in Rand Refinery with attributable net
assets:	836.9
Net assets/(liabilities) (44.4% (2017: 33.1%))	614.5	314.1
Preference shares redeemed	(186.9)	(102.8)	-
Dividend received	(8.2)	(8.2)	(8.2)
Fair value adjustment1	(35.5)	(35.5)	(35.5)
Impairment	(119.6)	(119.6)	(119.6)
Redeemable preference shares below 44.4% interest2	(89.8)	(109.1)	47.6
Total investment in Rand Refinery	396.9	239.3	198.4

1. The investment in equity-accounted investee was fair valued at 1 July 2002, the date when significant influence was obtained
2. Sibanye-Stillwater'stook up a 37.4% of the Facility, which is less than its current proportional interest in Rand Refinery. Rand Refinery converted the Facility into redeemable preference shares, classified within equity, and therefore Sibanye-Stillwater shares in less than its current 44.4% proportional interest of the net asset value of Rand Refinery

16.2 Mimosa

Sibanye-Stillwater has a 50% interest in Mimosa Investments Limited (Mimosa), which owns and operates the Mimosa mine, which is a Platinum mine situated in Zimbabwe and has a functional currency of US dollar.

The equity-accounted investment in Mimosa movement for the year is as follows:

Figures in million - SA rand	2019	2018	2017
Balance at the beginning of the year	2,492.4	2,012.9	2,049.3
Share of results of equity-accounted investee after tax	377.1	210.5	175.0
Dividends received	(111.0)	(87.0)	-
Foreign currency translation	(70.8)	356.0	(211.4)
Balance at end of the year	2,687.7	2,492.4	2,012.9

The Group's interest in the summarised financial statements of Mimosa are:

Figures in million - SA rand	2019	2018	2017
Revenue	4,685.2	3,714.9	3,375.4
Amortisation and depreciation	(437.4)	(383.1)	(423.4)
Interest income	4.5	-	17.5
Finance expense	(43.5)	(26.0)	(20.0)
Income tax	(436.4)	(381.8)	(245.0)
Profit or loss	754.2	420.9	350.1
Other comprehensive income	(141.3)	712.0	72.7
Total comprehensive income	612.9	1,132.9	422.8
Non-current assets	4,723.9	4,592.3	4,007.8
Property, plant and equipment1	4,704.8	4,592.3	4,007.8
Right-of-use assets	19.1	-	-
Current assets	2,535.1	2,047.9	1,916.2
Cash and cash equivalents	27.9	184.8	281.5
Other current assets	2,507.2	1,863.1	1,634.7
Non-current liabilities	(1,235.4)	(1,168.1)	(993.6)
Non-current financial liabilities	(128.7)	(60.7)	(94.2)
Other non-current liabilities	(1,106.7)	(1,107.4)	(899.4)
Current liabilities	(553.0)	(384.6)	(539.1)
Current financial liabilities	(446.5)	(377.7)	(487.4)
Other current liabilities	(106.5)	(6.9)	(51.7)
Net assets (100.0%)	5,470.6	5,087.5	4,391.3
Reconciliation of the total investment in Mimosa with attributable net assets:	2,735.3
Net assets (50.0%)	2,543.8	2,195.7
Reconciling items1	(47.6)	(51.4)	(182.8)
Total investment in Mimosa	2,687.7	2,492.4	2,012.9

1 The reconciling items include the difference between the carrying amount and fair value of the Mimosa's identifiable assets and liabilities on acquisition less accumulated amortisation, and foreign exchange differences on translation of assets and liabilities of the foreign joint venture

Repatriation of funds from Zimbabwe is subject to regulatory approval in Zimbabwe.

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FOR THE YEAR ENDED 31 DECEMBER 2019

16.3 Peregrine

On 29 June 2018, Sibanye-Stillwater announced that it had entered into an Arrangement Agreement with Regulus Resources Inc. (Regulus) and a newly formed subsidiary of Regulus, Aldebaran Resources Inc. (Aldebaran), creating a strategic partnership in order to unlock value at its Altar copper-gold project in San Juan Province, Argentina (Altar Project), currently held in the US PGM operations. Under the terms of the Arrangement Agreement, Stillwater Canada LLC, an indirect, wholly-owned subsidiary of Sibanye-Stillwater (Stillwater Canada), entered into an option and joint venture agreement with Aldebaran, whereby Aldebaran has the option to earn into a maximum 80% interest in a wholly-owned subsidiary of Stillwater Canada, Peregrine Metals Limited (Peregrine) which owns the Altar Project.

The consideration for Aldebaran to acquire up to an 80% interest in the Altar Project, included:

• An upfront cash payment of US$15 million to Sibanye-Stillwater on closing of the Arrangement Agreement;
• 19.9% of the shares of Aldebaran; and
• A commitment from Aldebaran to carry the next US$30 million of spend at the Altar Project over a maximum of five years (inclusive of 2018 drilling that was conducted between February and May of 2018) as an initial earn-in of a 60% interest in the Altar Project (the Initial Earn-in).

Pursuant to the Arrangement Agreement, Aldebaran may also elect to earn-in an additional 20% interest in the Altar Project by spending an additional US$25 million over a three-year period following the Initial Earn-in.

Peregrine was a subsidiary of Stillwater Canada. On 25 October 2018, Aldebaran issued an aggregate of 15,449,555 Aldebaran shares to Sibanye-Stillwater, representing 19.9% of the current 77,635,957 issued and outstanding Aldebaran shares, and made an upfront cash payment of US$15 million to Sibanye-Stillwater in accordance with the Arrangement Agreement. From this date, Stillwater Canada and Aldebaran act together to direct the relevant activities of and, therefore, collectively control Peregrine. As a result of loss of control, Peregrine was derecognised as a subsidiary and accounted for as an equity-accounted investment. Sibanye-Stillwater has a 40% (2018; 40%) interest in Perigrine.

The equity-accounted investment in Peregrine movement for the year is as follows:

Figures in million - SA rand	2019	2018	2017
Balance at the beginning of the year	978.0	-	-
Equity-accounted investment retained on loss of control of subsidiary	-	956.0	-
Foreign currency translation	(23.9)	22.0	-
Balance at end of the year	954.1	978.0	-
The Group's interest in the summarised financial statements of Peregrine is:
Figures in million - SA rand	2019	2018	2017
Non-current assets	1,472.4	1,714.6	-
Current assets	3.3	23.9	-
Non-current liabilities	(369.2)	(342.6)	-
Current liabilities	(1.4)	(1.3)	-
Net assets/(liabilities) (100.0%)	1,105.1	1,394.6	-
Reconciliation of the total investment in Peregrine with attributable net assets:	442.0	557.8	-
Net assets/(liabilities) (40%)
Reconciling items1	512.1	420.2	-
Total investment in Peregrine	954.1	978.0	-

1 The reconciling items include the difference between the carrying amount and fair value of the Peregrine's identifiable assets and liabilities on acquisition less accumulated amortisation, and foreign exchange differences on translation of assets and liabilities of the foreign equity-accounted investment

17. Interests in joint operations

Accounting policy

A joint operation is a joint arrangement in which the parties that share joint control have rights to the assets, and obligations for the liabilities, relating to the arrangement.

In relation to the Group's interests in joint operations, the following are recognised in the financial statements:

• the Group's share of the jointly controlled assets, classified according to the nature of the assets;
• any liabilities that the Group has incurred;
• the Group's share of any liabilities incurred jointly with the other ventures in relation to the joint operation;
• any income from the sale or use of the Group's share of the output of the joint operation, together with the Group's share of any expenses incurred by the joint operation; and
• any expenses that the Group has incurred in respect of its interest in the joint operation.

The Group's interests in joint operations includes a 50% interest in two joint operations each referred to as the "Notarial Pooling and Sharing Agreements". The principal activities of the joint operations are to extend the Kroondal mine over the boundary of the properties

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

covering the Kroondal mine and expand the Marikana mine operations through mineral rights contributed by Anglo American Platinum through its subsidiary, RPM.

The Group's share of the assets, liabilities, revenue and expenses of the joint operations which are included in the consolidated financial statements is as follows:

Kroondal mine

Figures in million - SA rand	2019	2018	2017
Loss on foreign exchange differences	(63.2)	132.7	(94.4)
Profit before tax	2,061.6	677.7	175.0
Profit for the year	2,061.4	677.7	175.0
Non-current assets	945.7	1,115.7	1,284.0
Current assets	2,303.0	1,828.2	1,400.5
Current liabilities	(353.1)	(271.3)	(283.2)
Net assets (50.0%)	2,895.6	2,672.6	2,401.3

18. Other investments

Accounting policy

On initial recognition of an equity investment that is not held for trading, the Group may make an irrevocable election to present subsequent changes in the investment's fair value in other comprehensive income. This election is made on an investment-by-investment basis. These investments are subsequently measured at fair value, with dividends recognised in profit or loss unless the dividend clearly represents a recovery of part of the cost of the investment. Other net gains and losses are recognised in OCI and are never reclassified to profit or loss.

The Group holds the following investments measured at fair value through OCI:

Figures in million - SA rand	2019	2018	2017
Rand Mutual Assurance Investment	112.4	67.8	-
Furuya Metals Investment	303.1	-	-
SpinCo Investment	78.2	81.5	-
Generation Mining	33.3	-	-
Other	71.7	6.7	-
Total other investments	598.7	156.0	-

Fair value of other Investments

Other investments consists primarily of other listed investments and other short-term investment products, which are measured at fair value or which carrying amounts approximates fair value. The fair values of non-listed investments included in other investments are determined through valuation techniques that include inputs that are not based on observable market data. Fair value measurements of listed investments are categorised as level 1 under the fair value hierarchy and non-listed investments as level 3.

19. Environmental rehabilitation obligation funds

Accounting policy

The Group's rehabilitation obligation funds includes equity-linked investments that are fair valued at each reporting date. The fair value is calculated with reference to underlying equity instruments using industry valuation techniques and appropriate models.

Annual contributions are made to dedicated environmental rehabilitation obligation funds to fund the estimated cost of rehabilitation during and at the end of the life of the relevant mine. The amounts contributed to these funds are included under non-current assets and are measured at fair value through profit or loss. Interest earned on monies paid to rehabilitation funds is accrued on a time proportion basis and is recorded as interest income.

In addition, bank guarantees are provided for funding shortfalls of the environmental rehabilitation obligations.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Figures in million - SA rand	Note	2019	2018	2017
Balance at beginning of the year		3,998.7	3,492.4	3,100.5
Contributions made		12.9	63.0	114.5
Payments received		(151.9)	-	-
Interest income		265.5	223.5	230.4
Fair value gain/(loss)1		33.8	(24.9)	46.5
Environmental rehabilitation obligation funds on acquisition of subsidiaries	14	443.2	244.7	0.5
Foreign currency translation		-	-	-
Balance at end of the year		4,602.2	3,998.7	3,492.4
Environmental rehabilitation obligation funds comprise of the following:		610.0
Restricted cash2		633.9	483.8
Funds		3,992.2	3,364.8	3,008.6

1. The environmental rehabilitation trust fund includes equity-linked investments that are fair valued at each reporting date
2. The funds are set aside to serve as collateral against the guarantees made to the Department of Minerals and Resources for environmental rehabilitation obligations

Fair value of environmental rehabilitation obligation funds

Environmental rehabilitation obligation funds comprise equity-linked notes, a fixed income portfolio of bonds as well as fixed and call deposits. The environmental rehabilitation obligation funds are stated at fair value based on the nature of the fund's investments.

The fair value hierarchy is as follows:

Figures in million - SA rand	2019	2018	2017
Level 1	3,578.3	3,634.0	3,117.6
Level 21	1,023.9	364.7	374.8

1 Equity-linked notes have a fixed component of 5% capital guarantee and equity-linked portion which is linked to the performance of the JSE top 40 index. Fair value is determined by the fund manager based on the composition of the underlying investment portfolio, relevant equity prices and the terms of the investments

The fixed income portfolio consists of instruments such as government bonds and inflation-linked bonds. Valuations are performed by the fund manager based on the composition of the portfolio, the relevant investment terms and through reference to market related interest rates

Credit risk

The Group is exposed to credit risk on the total carrying value of the investments held in the environmental rehabilitation obligation funds. The Group has reduced its exposure to credit risk by dealing and investing with a limited number of major financial institutions.

20. Other receivables and other payables

Significant accounting judgements and estimates

Expected future cash flows used to determine the fair value of the other payables (namely the Deferred Payment, right of recovery payable and contingent consideration) and the right of recovery receivable are inherently uncertain and could materially change over time. The expected future cash flows are significantly affected by a number of factors including reserves and production estimates, together with economic factors such as the expected commodity price, currency exchange rates, and estimates of production costs, future capital expenditure and discount rates.

Accounting policy

Financial instruments included in other receivables are categorised as financial assets measured at amortised cost and those included in other payables are categorised as other financial liabilities as applicable. These assets and liabilities are initially recognised at fair value. Subsequent to initial recognition financial instruments included in other receivables and other payables are measured at amortised cost.

Reimbursements, such as rehabilitation reimbursements from other parties are not financial instruments, and are recognised as a separate asset where recovery is virtually certain. The amount recognised is limited to the amount of the provision. If the party that will make the reimbursement cannot be identified, then the reimbursement is generally not virtually certain and cannot be recognised. If the only uncertainty regarding the recovery relates to the amount of the recovery, the reimbursement amount often qualifies to be recognised as an asset.

Other receivables and payables that do not arise from contractual rights and obligations, such as receivables on rates and taxes, are recognised and measured at the amount expected to be received or paid.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

20.1 Other receivables
		Figures in million - SA rand	2019	2018	2017
		Right of recovery receivable	186.8	176.8	160.5
		Rates and taxes receivable	103.0	106.2	105.6
		Pre-paid royalties	392.8	-	-
		Other	52.1	66.6	53.1
		Total other receivables	734.7	349.6	319.2
		Reconciliation of the non-current and current portion of the other receivables:	734.7
		Other receivables	349.6	319.2
		Current portion of other receivables	(51.2)	(35.2)	(35.2)
		Non-current portion of other receivables	683.5	314.4	284.0

20.2 Other payables

Figures in million - SA rand	2019	2018	2017
Deferred Payment (related to Rustenburg operations acquisition)	2,825.6	2,205.9	2,194.7
Contingent consideration (related to SFA (Oxford) acquisition)	55.8	-	-
Right of recovery payable	79.4	83.2	69.3
Deferred consideration (related to Pandora acquisition)	275.9	-	-
Dissenting shareholder liability	-	287.1	1,349.7
Other	212.2	256.3	188.6
Total other payables	3,448.9	2,832.5	3,802.3
Reconciliation of the non-current and current portion of the other payables:	3,448.9
Other payables	2,832.5	3,802.3
Current portion of other payables	(761.4)	(303.3)	(41.9)
Non-current portion of other payables	2,687.5	2,529.2	3,760.4

Right of recovery receivable and payable

Based on the first and second Notarial Pooling and Sharing agreements (PSAs) with Anglo American Platinum, Kroondal Operations Proprietary Limited (Kroondal Operations) (previously Aquarius Platinum (South Africa) Proprietary Limited (AQPSA)) holds a contractual right to recover 50% of the rehabilitation obligation relating to environmental rehabilitation resulting from PSA operations from Rustenburg Platinum Mines (RPM)(subsidiary of Anglo American Platinum), where this rehabilitation relates to property owned by Kroondal Operations. Likewise RPM holds a contractual right to recover 50% of the rehabilitation obligation relating to environmental rehabilitation resulting from PSA operations from Kroondal Operations, where the rehabilitation relates to property owned by RPM. With respect to the opencast section of the Marikana mine that is on Kroondal Operations' property, RPM have limited the contractual liability to approximately R179 million (2018: R172 million), being a negotiated liability in terms of an amendment to the second PSA.

Deferred Payment (related to Rustenburg operations acquisition)

In terms of the Rustenburg operation Transaction the purchase consideration includes a Deferred Payment, calculated as being equal to 35% of the distributable free cash flow generated by the Rustenburg operation over a six year period from inception, subject to a minimum payment of R3.0 billion. The distributable free cash flow has been derived from forecast cash flow models. These models use several key assumptions, including estimates of future sales volumes, PGM prices, operating costs and capital expenditure.

The Deferred Payment movement for the year is as follows:

Figures in million - SA rand	Note	2019	2018	2017
Balance at the beginning of the year		2,205.9	2,194.7	1,577.4
Interest charge	5	179.0	200.4	148.2
Payment of Deferred Payment		(283.4)	(38.6)	-
Loss/(gain) on revised estimated cash flows		724.1	(150.6)	469.1
Balance at end of the year		2,825.6	2,205.9	2,194.7

Deferred consideration (related to Pandora acquisition)

Lonmin acquired the remaining 50% stake in Pandora Joint Venture in 2017. The purchase price included a deferred and contingent consideration element. The deferred payment element represents a minimum consideration of R400 million, which is settled through a cash payment based on 20% of the distributable free cash flows generated from the Pandora E3 operations on an annual basis for a period of 6 years. The fair value of the deferred consideration at acquisition of Lonmin by the Group was determined using the present value of the future cash flows at a discount rate of 12.5%. The contingent consideration element is based on the extent to which 20% of the distributable free cash flows exceed R400 million. This element is valued at zero as the distributable free cash flows generated from the Pandora E3 operations is not estimated to exceed R400 million. The distributable free cash flow has been derived from forecast cash flow models. These models use several key assumptions, including estimates of future sales volumes, PGM prices, operating costs and capital expenditure.

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FOR THE YEAR ENDED 31 DECEMBER 2019

The Pandora deferred consideration movement for the year is as follows:

Figures in million - SA rand	Note	2019	2018	2017
Deferred consideration on acquisition of subsidiary		235.4
Interest charge	5	40.5	-	-
Balance at end of the year		275.9	-	-

Dissenting shareholder liability

The Court of Chancery of the State of Delaware in the United States of America (the Court), in a Memorandum Opinion dated 21 August 2019, has ruled in favour of the Company in the appraisal action brought by a group of minority shareholders (the Dissenting Shareholders) of the Stillwater Mining Company (Stillwater), following the acquisition of Stillwater by the Company in May 2017 for a cash consideration of US$18 per Stillwater share.

In terms of the ruling, the Dissenting Shareholders (together owning approximately 4.5% of Stillwater shares outstanding at the time) received the same US$18 per share consideration originally offered to, and accepted by other Stillwater shareholders, plus interest. The remaining payment of approximately US$21 million due to the Dissenting Shareholders has been paid by Sibanye-Stillwater during the six months ended 31 December 2019.

Certain of the Dissenting Shareholders have filed an appeal with the Supreme Court of the State of Delaware with the date for the oral argument, originally set for 1 April 2020, postponed in light of COVID-19 until a future date is set by the Court. The Company will continue to defend itself against opportunistic, short-term and self-interested legal action, to protect the interests of our stakeholders.

The dissenting shareholder liability movement for the year is as follows:

Figures in million - SA rand	Note	2019	2018	2017
Balance at the beginning of the year		287.1	1,349.7	-
Interest charge	5	21.2	68.1	62.9
Payments to dissenting shareholders		(319.4)	(1,375.8)	-
Dissenting shareholder liability on acquisition of subsidiary		-	-	1,364.3
Foreign currency translation reserve		11.1	245.1	(77.5)
Balance at end of the year		-	287.1	1,349.7

Fair value of other receivables and other payables

Due to the approaches applied in calculating the carrying values as described above, the fair values approximate the carrying value.

Market risk

The Deferred Payment relating to Rustenburg and the deferred consideration relating to Pandora are sensitive to changes in the 4E basket price. A one percentage point decrease in the 4E basket price would have decreased the loss on financial instruments by R95.6 million. A one percentage point increase in the 4E basket price would have increased the loss on financial instruments by R95.6 million.

A one percentage point increase in the 4E basket price would have increased the loss on financial instruments by R95.6 million.

21. Inventories

Significant accounting judgements and estimates

Inventory is held in a wide variety of forms across the value chain reflecting the stage of refinement. Prior to production as final metal the inventory is always contained within a carrier material. As such inventory is typically sampled and assays taken to determine the metal content and how this is split by metal. Measurement and sampling accuracy can vary quite significantly depending on the nature of the vessels and the state of the material. An allowance for estimation uncertainty is applied to the various categories of inventory and is dependent on the degree to which the nature and state of material allows for accurate measurement and sampling. The range used for the estimation allowance varies based on the stage of refinement. The range is based on independent metallurgists' level of confidence obtained from the outcome of the stocktake. Those results are applied in arriving at the appropriate quantities of inventory.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Accounting policy

Inventory is valued at the lower of cost and net realisable value. The Group values ore stockpiles, metal-in-process when it can be reliably measured. Cost is determined on the following basis:

• Gold reef ore stockpiles and gold-in-process are valued using weighted average cost. Cost includes production, amortisation, depreciation and related administration costs
• PGM inventory is valued using weighted average cost by allocating cost, based on the joint cost of production, apportioned according to the relative sales value of each of the PGMs produced. The group recognises the metal produced in each development phase in inventory with an appropriate proportion of cost. Cost includes production, amortisation, depreciation and related administration costs
• By-productmetals are valued at the incremental cost of production from the point of split-off from the PGM processing stream
• Consumable stores are valued at weighted average cost after appropriate provision for surplus and slow-moving items

Figures in million - SA rand	2019	2018	2017
Consumable stores1	1,580.8	1,043.5	820.7
PGM ore and mill inventory	127.7	71.0	62.8
PGM in process2	10,496.9	3,251.7	1,893.1
Gold in process	309.7	143.3	-
PGM finished goods	2,958.7	777.8	637.5
Other	29.6	7.5	8.0
Uranium finished goods and uranium-in-process	-	-	104.4
Total inventories	15,503.4	5,294.8	3,526.5

1. The cost of consumable stores consumed during the year and included in operating cost amounted to R12,784.3 million (2018: R9,327.9 million and 2017: R8,789.4 million)
2. Included in PGM in process, is R3,826.5 million relating to the Marikana operations. It also includes R4,182.4 million relating to SRPM operations due to the processing agreements between SRPM and Anglo American Platinum Limited changing from a Purchase of Concentrate arrangement to a Toll processing arrangement from 1 January 2019

22. Trade and other receivables

Accounting policy

Trade and other receivables, excluding trade receivables for PGM concentrate sales, prepayments and value added tax, are non- derivative financial assets categorised as financial assets measured at amortised cost.

The above non-derivative financial assets are initially recognised at fair value and subsequently carried at amortised cost less allowance for impairment. Estimates made for impairment are based on a review of all outstanding amounts at year end in line with the impairment policy described in note 34. Irrecoverable amounts are written off during the period in which they are identified.

In addition to other types PGM sales, trade receivables include actual invoiced sales of PGM concentrate, as well as sales not yet invoiced for which deliveries have been made and the control has transferred. The PGM concentrate receivables are financial assets measured at fair value through profit or loss, as the solely payments of principle and interest criteria is not met. The receivable amount calculated for the PGM concentrate delivered but not yet invoiced is recorded at the fair value of the consideration receivable at the date of delivery. At each subsequent reporting date the receivable is restated to reflect the fair value movements in the pricing mechanism. Foreign exchange movements subsequent to the recognition of a sale are recognised as a foreign exchange gain or loss in profit or loss.

Figures in million - SA rand	2019	2018	2017
Trade receivables - gold sales	-	433.8	499.6
Trade receivables - PGM sales1	2,681.1	5,310.1	4,512.4
PGM sales concentrate	2,341.6	5,310.1	4,512.4
PGM sales other	339.5	-	-
Other trade receivables	889.0	436.6	431.4
Payroll debtors	251.5	127.9	174.1
Interest receivable	14.6	8.9	8.5
Financial assets	3,836.2	6,317.3	5,626.0
Prepayments	442.9	296.9	245.0
Value added tax	355.9	218.8	326.6
Total trade and other receivables	4,635.0	6,833.0	6,197.6

1 The PGM sales trade receivables includes a contract receivable of R1,606.4 million (2018: R3,786.5 million)

Fair value of trade and other receivables

The fair value of trade receivables for PGM concentrate sales are determined based on ruling market prices, volatilities and interest rates, and constitutes level 2 on the fair value hierarchy.

The fair value of trade and other receivables measured at amortised cost approximate the carrying value due to the short maturity.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Credit risk

The Group is exposed to credit risk on the total carrying value of trade and other receivables.

Trade receivables measured at amortised cost are reviewed on a regular basis and an allowance for impairment is raised when they are not considered recoverable based on an expected credit loss assessment. The Group transacts exclusively with a limited number of large international institutions and other organisations with strong credit ratings and the negligible historical level of customer default. Trade receivables are currently in a sound financial position and no impairment has been recognised.

At 31 December 2019, other receivables of R139.9 million (2018: R15.8 million and 2017: R5.7 million) were considered impaired and are provided for.

23. Cash and cash equivalents

Accounting policy

Cash and cash equivalents comprise cash on hand, demand deposits and short-term, highly liquid investments readily convertible to known amounts of cash and subject to insignificant risk of changes in value, and are measured at amortised cost which is deemed to be fair value due to its short-term maturity.

Figures in million - SA rand	2019	2018	2017
Cash at the bank and on hand1	5,619.0	2,549.1	2,062.4
Total cash and cash equivalents	5,619.0	2,549.1	2,062.4

1 At 31 December 2019, restricted cash of US$6.4 million (R89.6 million) was held in a money market fund as collateral for the environmental bonding requirements in the US

Fair value of cash and cash equivalents

The fair value of cash and cash equivalents approximate the carrying value due to the short maturity.

Credit risk

The Group is exposed to credit risk on the total carrying value of cash and cash equivalents. The Group has reduced its exposure to credit risk by dealing and investing with a number of major financial institutions.

24. Stated share capital

Accounting policy

Ordinary share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from equity, net of any tax effects.

Figures in thousand	2019	2018	2017
Authorised number of shares	10,000,000	10,000,000	10,000,000
Reconciliation of issued number of shares:	2,266,261
Number of shares in issue at beginning of the year	2,168,721	929,004
Shares issued under SGL Share Plan	4,442	10,394	1,407
Shares issued for cash	108,932	-	-
Shares issued with acquisition of subsidiary	290,395	-	-
Rights issue	-	-	1,195,787
Capitalisation issue	-	87,146	42,523
Number of shares in issue at end of the year	2,670,030	2,266,261	2,168,721

Authorised and issued

As at 31 December 2016, the authorised share capital was 2,000,000,000 ordinary no par value shares and issued ordinary share capital was 929,004,342 ordinary no par value shares.

At the shareholder's general meeting on 25 April 2017, the authorised number of shares was increased to 10,000,000,000 ordinary no par value shares.

On 14 June 2017, Sibanye-Stillwater raised net capital of R12,932.4 million, being proceeds of R13,438.5 million and transactions costs of R506.1 million, from a rights issue, when 1,195,787,294 shares were issued with nine (9) new shares issued for every seven (7) existing shares held, on 4 October 2017, 42,522,524 shares were issued with two (2) capitalisation issue shares for every 100 existing share held.

On 11 April 2018, 87,145,885 shares were issued with four (4) capitalisation issue shares for every 100 existing share held.

On 15 April 2019, Sibanye-Stillwater raised net capital of R1.7 billion from a placing of 108,932,356 new ordinary no par value shares to existing and new institutional investors.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

On 10 June 2019, 290,394,531 shares were issued to the shareholders of Lonmin Plc (refer note 14.1).

All the Sibanye-Stillwater ordinary no par value shares rank pari passu in all respects, there being no conversion or exchange rights attached thereto, and all of the ordinary shares will have equal rights to participate in capital, dividend and profit distributions by the Company.

Repurchase of shares

The Company has not exercised the general authority granted to buy back shares from its issued ordinary share capital granted at the shareholders' meeting held on 28 May 2019. The next AGM for the Group will be the AGM held for Sibanye Stillwater Limited.

25. Non-controlling interests

Accounting policy

Non-controlling interests

The Group recognises any non-controlling interest in an acquiree either at fair value or at the non-controlling interest's proportionate share of the acquiree's net assets on an acquisition by acquisition basis. Subsequently, the carrying amount of non-controlling interest is the amount of the interest at initial recognition plus the non-controlling interest's subsequent share of changes in equity.

Transactions with non-controlling interests

The Group treats transactions with non-controlling interests as transactions with equity owners of the Group. For purchases from non- controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests where control is not lost are also recorded in equity. Where control is lost over a subsidiary, the gains or losses are recognised in profit or loss.

The Group's non-controlling interests relates to the following subsidiaries:

Figures in million - SA rand	2019	2018	2017
Non-controlling interest of DRDGOLD	1,135.2	913.2	-
Non-controlling interest of Platinum Mile	21.1	18.4	15.7
Non-controlling interests of Group Technical Security Management (GTSM)	5.4	4.4	4.1
Non-controlling interests of Marikana1	306.0	-	-
Total non-controlling interests	1,467.7	936.0	19.8

1 Included in Marikana's non-controlling interest (NCI) is NCI of Western Platinum (Pty) Ltd amounting to R253.3 million

DRDGOLD is a company incorporated in South Africa with its head office in Johannesburg. DRDGOLD's primary listing is on the JSE Limited and its secondary listing is on the New York Stock Exchange. It's gold production is derived from retreatment of surface tailings in South Africa. Non-controlling interests hold a 61.95% (2018: 61.95%) interest in DRDGOLD and is consolidated based on the ability to control through an option to increase the group's shareholding in DRDGOLD to 50.1%.

Western Platinum (Pty) Ltd, acquired as part of the Lonmin acquisition, consist of PGM mining and processing operations located on the Western Limb of the Bushveld Complex, close to the town of Rustenburg, in the North West province of South Africa and smelting and refining operations located in Brakpan, East of Johannesburg. Non-controlling interests hold a 4.75% interest in Western Platinum (Pty) Ltd.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

The summarised financial information of these subsidiary groups is provided below. This information is based on amounts before inter- company eliminations.

Figures in million - SA rand

DRDGOLD Limited

Revenue

Profit for the year

Total comprehensive income

Profit attributable to NCI

Net increase/(decrease) in cash and cash equivalents Dividends paid

Non-current assets

Current Assets

Non-current liabilities

Current liabilities

Net assets

Western Platinum Proprietary Limited

Revenue

Profit for the year

Total comprehensive income

Profit attributable to NCI

Net decrease in cash and cash equivalents Dividends paid

Non-current assets

Current Assets

Non-current liabilities

Current liabilities

Net assets

2019	2018
3,621.0	1,047.5
460.2	(39.9)
459.1	(43.8)
285.1	(24.7)
334.0	(73.4)
85.0	-
3,393.1	3,581.9

972.2 591.0

(1,108.6) (1,275.6)

(463.3) (425.2)

2,793.5 2,472.1

11,124.5	-
763.7	-
763.7	-
17.0	-
(2,070.2)	-
-	-
7,749.5	-
6,832.0	-
(22,462.3)	-
(2,201.7)	-
(10,082.6)	-

26. Borrowings and derivative financial instrument

Significant accounting judgements and estimates

Borrowings

Expected future cash flows used to determine the fair value of borrowings (namely the Burnstone Debt) are inherently uncertain and could materially change over time. They are significantly affected by a number of factors including reserves and production estimates, together with economic factors such as the expected commodity price, foreign currency exchange rates, and estimates of production costs, future capital expenditure and discount rates.

Accounting policy

Borrowings

Borrowings are non-derivative financial liabilities categorised as other financial liabilities. Borrowings are recognised initially at fair value, net of transaction costs incurred, where applicable and subsequently measured at amortised cost using the effective interest method.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

Derivative financial instruments

Derivatives are initially recognised at fair value using option pricing methodologies. Any directly attributable transaction costs are recognised in profit or loss as incurred. Subsequent to initial recognition, derivatives are measured at fair value, and changes are generally recognised in profit or loss.

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group determines whether transfers have occurred between levels in the fair value hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Borrowings

Figures in million - SA rand	Notes	2019	2018	2017
US$600 million RCF	26.1	5,711.9	2,726.5	-
R6.0 billion RCF	26.2	-	5,896.4	5,536.4
R5.5 billion RCF	26.3	2,500.0	-	-
2022 and 2025 Notes	26.4	9,609.8	9,808.7	12,597.7
US$ Convertible Bond	26.5	4,578.6	4,496.6	4,357.1
Burnstone Debt	26.6	1,330.4	1,145.1	1,537.5
Other borrowings	26.7	-	425.6	478.7
Franco-Nevada liability		2.0	2.0	1.7
Stillwater Convertible Debentures		3.5	3.8	3.3
US$350 million RCF		-	-	1,137.1
Total borrowings		23,736.2	24,504.7	25,649.5
Reconciliation of the non-current and current portion of the borrowings:
Borrowings		23,736.2	24,504.7	25,649.5
Current portion of borrowings		(38.3)	(6,188.2)	(1,657.5)
Non-current portion of borrowings		23,697.9	18,316.5	23,992.0

The current portion of borrowings will be repaid out of operational cash flows or it will be refinanced by utilising available Group facilities.

Derivative financial instruments

Figures in million - SA rand	Note	2019	2018	2017
Reconciliation of the non-current and current portion of the derivative
financial instrument:		4,144.9
Derivative financial instruments	26.5	408.9	1,093.5
Non-current portion of derivative financial instrument		4,144.9	408.9	1,093.5
Roll forward of borrowings in the current year were as follows:
Figures in million - SA rand	Note	2019	2018	2017
Balance at beginning of the year		24,504.7	25,649.5	8,973.8
Borrowings acquired on acquisition of subsidiary	14.1	2,574.8	-	5,937.6
Loans raised		18,981.7	17,130.2	68,297.2
Loans repaid		(22,008.3)	(21,231.5)	(55,719.5)
Unwinding of loans recognised at amortised cost		374.4	538.3	222.1
Accrued interest (related to the 2022 and 2025 Notes, and US$ Convertible Bond)		769.9	942.5	507.8
Accrued interest paid		(777.7)	(907.2)	(431.5)
Gain on derecognition of borrowings		-	(179.7)	-
Loss/(gain) on the revised cash flow of the Burnstone Debt		96.6	(804.6)	(181.7)
(Gain)/loss on foreign exchange differences and foreign currency translation		(779.9)	3,367.2	(1,956.3)
Balance at end of the year		23,736.2	24,504.7	25,649.5

26.1 US$600 million RCF

On 21 May 2018, Sibanye-Stillwater cancelled and refinanced the US$350 million revolving credit facility (RCF) by drawing under the US$600 million RCF. The purpose of the facility was to refinance the US$350 million RCF, finance ongoing capital expenditure and working capital.

Terms of the US$600 million RCF

Facility:	US$600 million
Interest rate:	LIBOR
Interest rate margin:	1.85% if net debt to adjusted EBITDA is equal to or less than 2.50x
	2.00% if net debt to adjusted EBITDA is greater than 2.50x
Utilisation fees:	Where the total outstanding loans under the RCF fall within the range of the percentage of the total loan as set
	out below, Sibanye-Stillwater shall pay an utilisation fee equal to the percentage per annum set out opposite
	such percentage range.
	% of the total loans
	Less than or equal to 33⅓%	0.15%
	Greater than 33⅓% and less than or equal to 66⅔%	0.30%
	Greater than 66⅔%	0.50%

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Term of facility:	Three years, subject to 2 one-year extensions at the lenders option. US$450 million of the facility lenders (i.e. six
	of the eight lenders) have exercised the first one year extension option year extension option.
Borrowers:	Sibanye Gold Limited, Stillwater, Kroondal Operations, SRPM and WPL.
Security and/or	The facility is unsecured and guaranteed by Sibanye Gold Limited, Stillwater, Kroondal Operations, SRPM and
guarantors:	WPL.

Figures in million - SA rand	2019	2018	2017
Balance at beginning of the year	2,726.5	-	-
Loans raised	9,067.1	5,391.6	-
Loans repaid	(5,826.2)	(2,744.7)	-
Loss on foreign exchange differences	6.4	73.1	-
Foreign currency translation	(261.9)	6.5	-
Balance at end of the year	5,711.9	2,726.5	-

26.2 R6.0 billion RCF

On 15 November 2016, Sibanye-Stillwater cancelled and refinanced a R4.5 billion Facilitiy by drawing under the R6.0 billion RCF. The purpose of the facility was to refinance the R4.5 billion Facility, finance ongoing capital expenditure, working capital and general corporate expenditure requirements which may include the financing of future acquisitions of business combinations. This facility was refinanced and cancelled in November 2019.

Terms of the R6.0 billion RCF

Facility:	R6.0 billion
Interest rate:	JIBAR

Interest rate margin: During the Covenant adjustment period, being 30 June 2017 to 31 December 2019, the margin will be based on the following net debt to adjusted EBITDA ratios:

		Net debt to adjusted EBITDA			Margin %
		ratios
		0.00:1 - 3.00:1			2.40%
		3.00:1 - 3.25:1			2.65%
		3.25:1 - 3.50:1			2.90%
		After the covenant adjustment period the margin will return to 2.4%
	Term of facility:	Three years
	Borrowers:	Sibanye Gold Limited, SRPM and Kroondal Operations
	Security and/or
	guarantors:	The facility was unsecured and guaranteed by Sibanye Gold Limited,Stillwater, SRPM and Kroondal.
	Figures in million - SA rand	2019	2018	2017
	Balance at beginning of the year	5,896.4	5,536.4	5,100.0
	Loans raised		1,150.0	360.0	800.0
	Loans repaid		(5,046.4)	-	(363.6)
	Inter Bank transfer		(2,000.0)	-	-
	Balance at end of the year	-	5,896.4	5,536.4

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

26.3 R5.5 billion RCF

On 11 November 2019, Sibanye-Stillwater refinanced and cancelled the R6.0 billion revolving credit facility (RCF) by drawing under the R5.5 billion RCF. The purpose of the facility was to refinance facilities, finance ongoing capital expenditure and general corporate expenditure requirements.

Terms of the R5.5 billion RCF

Facility:	R5.5 billion
Interest rate:	JIBAR
Interest rate margin:	2.40% if net debt to adjusted EBITDA is equal to or less than 2.00x
	2.60% if net debt to adjusted EBITDA is greater than 2.00x
Term of facility:	Three years, subject to two one-year extensions at the lenders option
Borrowers:	Sibanye Gold Limited, Kroondal Operations , SRPM and WPL.
Security and/or	The facility is unsecured and guaranteed by Sibanye Gold Limited, Stillwater, Kroondal Operations, SRPM and
guarantors:	WPL.

Figures in million - SA rand	2019	2018	2017
Balance at beginning of the year	-	-	-
Loans raised	500.0	-	-
Loans repaid	-	-	-
Inter Bank transfer	2,000.0
Balance at end of the year	2,500.0	-	-

26.4 2022 and 2025 Notes

On 27 June 2017, Stillwater Mining Co. completed a two-tranche international corporate bond offering 6.125% Notes due on 27 June 2022 (the 2022 Notes) and 7.125% Notes due on 27 June 2025 (the 2025 Notes) (together the 2022 and 2025 Notes) with the proceeds applied towards the partial repayment of the Stillwater Bridge Facility, raised for the acquisition of Stillwater. On 19 September 2018, Sibanye-Stillwater concluded the repurchase of a portion of the 2022 and 2025 Notes issued by Stillwater Mining Company. The total purchase price was approximately US$345 million (nominal value of US$349 million) and was funded from existing cash resources, including the US$500 million advance proceeds from the Streaming transaction.

Terms of the 2022 and 2025 Notes

Facility:	US$500 million 6.125% Senior Notes due 2022 (the 2022 Notes)
	US$550 million 7.125% Senior Notes due 2025 (the 2025 Notes)
Outstanding nominal value: 2022 Notes: US$353.7 million
	2025	Notes: US$346.9 million
Interest rate:	2022	Notes: 6.125%
	2025	Notes: 7.125%
Term of the Notes:	2022	Notes: Five years
	2025	Notes: Eight years
Issuer:	Stillwater Mining Company
Guarantors:	Each of the Notes will be fully and unconditionally guaranteed, jointly and severally by the Guarantors
	(Kroondal Operations, SRPM and Sibanye Gold Limited). WPL acceded as a guarantor on 8 January 2020,
	post the year end. The Guarantees rank equally in right of payment to all existing and future senior debt of
	the Guarantors.

Figures in million - SA rand	2019	2018	2017
Balance at beginning of the year	9,808.7	12,597.7	-
Loans raised	-	-	13,109.5
Loans repaid	-	(5,107.4)	-
Accrued interest paid	(672.2)	(795.5)	(431.5)
Interest charge	664.9	836.6	478.1
Unwinding of amortised cost	47.9	196.7	29.7
Gain on derecognition of borrowings	-	(128.8)	-
Foreign currency translation	(239.5)	2,209.4	(588.1)
Balance at end of the year	9,609.8	9,808.7	12,597.7

26.5 US$ Convertible Bond

The US$ Convertible Bond was launched and priced on 19 September 2017 with the proceeds applied towards the partial repayment of the Stillwater Bridge Facility, raised for the acquisition of Stillwater. On 11 September 2018, Sibanye-Stillwater concluded the repurchase

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

of a portion of the US$ Convertible Bond. An aggregate principal amount of US$66 million for a total purchase price of approximately US$50 million was repurchased. Sibanye-Stillwater funded the repurchase from existing cash resources, including the US$500 million advance proceeds of the streaming transaction.

Terms of the US$ Convertible Bond

Issue size:	US$450 million
Outstanding nominal value:	US$384 million
Coupon:	1.875%
Maturity date:	26 September 2023 (six years)
Conversion premium:	35%
Reference share price:	US$1.2281, being the volume weighted average price of a share on the JSE from launch to pricing on
	19 September 2017, converted at a fixed exchange rate.
Initial conversion price:	US$1.6580
Issuer:	Sibanye Gold Limited
Guarantors:	Stillwater and Kroondal Operations

The US$ Convertible Bond has two components. The option component is recognised as a derivative liability, measured at fair value, with changes in fair value recorded in profit or loss and reported separately in the statement of financial position. The bond component is recognised as a financial liability and measured at amortised cost using the effective interest method.

Convertible bond at amortised cost

Figures in million - SA rand	2019	2018	2017
Balance at beginning of the year	4,496.6	4,357.1	-
Loans raised	-	-	4,634.5
Loans repaid	-	(745.2)	-
Accrued interest paid	(105.5)	(111.7)	-
Interest charge	105.0	105.9	29.8
Unwinding of amortised cost	196.8	185.8	50.7
Gain on derecognition of borrowings	-	(50.9)	-
Gain/(loss) on foreign exchange differences	(114.3)	755.6	(357.9)
Balance at end of the year	4,578.6	4,496.6	4,357.1

Derivative financial instrument at fair value

Figures in million - SA rand	2019	2018	2017
Balance at beginning of the year	408.9	1,093.5	-
Loss/(gain) on financial instruments1	3,911.5	(678.1)	(115.9)
Gain on derecognition of derivative financial instrument	-	(50.3)	-
Derivative financial instrument recognised	-	-	1,296.6
(Gain)/loss on foreign exchange differences	(175.5)	43.8	(87.2)
Balance at end of the year	4,144.9	408.9	1,093.5

1 The R3,911.5 million loss on financial instrument is mainly attributable to the 258% increase in the Sibanye-Stillwater share price as at 31 December 2019 relative to the prior year. The loss on financial instrument is calculated based on the year end share price of R35.89 per share, ZAR/USD exchange rate of R14.00 and a volatility of 38.76%. The derivative was valued using a partial differential equation model

26.6 Burnstone Debt

Sibanye Gold Eastern Operations (SGEO) has bank debt of US$178.1 million (R1,883.9 million) (the Burnstone Debt) outstanding as part of the net assets acquired on 1 July 2014.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Terms of the Burnstone Debt

Facility:	A1: US$0.2 million
	A2: US$7.8 million
	A3: US$51.0 million
	A4: US$119.1 million
Interest rate:	A1 and A2: Interest free
	A3 and A4: Interest free until 1 July 2017, then at LIBOR
Interest rate margin:	A3 and A4: 4% from 1 July 2017
Term of loan:	No fixed term
Repayment period:	A1: Repaid on 1 July 2014
	A2: From 1 July 2017 the first 50% of Burnstone's free cash flow (as defined in the settlement agreement)
	will be used to repay the Wits Gold Loan and the balance of 50% to repay A2.
	A3 and A4: On settlement of A2. 90% of Burnstone's free cash flow will be used to repay the Wits Gold Loan
	and the balance of 10% to repay the Burnstone Debt. On settlement of the Wits Gold Loan and interest, 30%
	of Burnstone's free cash flow will be used to repay the Burnstone Debt and the balance will be distributed to
	Wits Gold.
	The Bank Lenders will continue to participate in 10% of Burnstone's free cash flow after the Burnstone Debt
	has been repaid in full to a maximum amount of US$63.0 million under a revenue participation agreement.
Security:	The Burnstone Debt is fully secured against the assets of Burnstone (of R2.0 billion) and there is no recourse
	to the Sibanye-Stillwater Group. The security package includes a cession over the bank accounts, insurance
	policies' proceeds, special and general notarial bonds over movable assets and mortgage bonds over
	property.

The Burnstone Debt facilities of US$178.1 million (R1,883.9 million) were initially recognised at the acquisition fair value using level 3 assumptions, being R1,007.6 million, in terms of IFRS 13. The expected free cash flows to repay the loan as detailed above were based on the estimates and assumptions to determine the fair value:

• A US$ swap forward curve adjusted with the 4% interest rate margin above;
• The annual life of mine plan that takes into account the following:
• • Proved and probable ore reserves of Burnstone;
  • Cash flows are based on the life-of-mine plan of 20 years; and
  • Capital expenditure estimates over the life-of-mine plan.

Figures in million - SA rand	2019	2018	2017
Balance at beginning of the year	1,145.1	1,537.5	1,752.6
Accrued interest and unwinding of amortised cost	120.1	152.9	141.6
Loss/(gain) on revised estimated cash flows1	96.6	(804.6)	(181.7)
(Gain)/loss on foreign exchange differences	(31.4)	259.3	(175.0)
Balance at end of the year	1,330.4	1,145.1	1,537.5

1 At 31 December 2019, the expected free cash flows expected to repay the loan as detailed above were revised as a result of revised cash flows over the life of mine plan due to:

• Revised forecast costs and capital expenditure; and
• Revised gold prices 2019: R686,225/kg (2018: R585,500/kg and 2017: R545,000/kg) and exchange rates 2019: R14.00/US$ (2018: R14.00/US$ and
  2017: R12.94/US$)

26.7 Other borrowings

Short-term credit facilities

Sibanye-Stillwater has uncommitted loan facilities with various banks to fund capital expenditure and working capital requirements at its operations. These facilities have no fixed terms, are short-term in nature and interest rates are market related.

Figures in million - SA rand	2019	2018	2017
Balance at beginning of the year	425.6	478.7	749.5
Loans raised	8,264.6	10,798.6	14,721.5
Loans repaid	(11,135.7)	(10,854.6)	(14,992.3)
Unwinding of amortised cost	9.6	2.9	-
Borrowings acquired on acquisition of subsidiary	2,574.8	-	-
Other	1.3	-	-
Gain on foreign exchange differences	(140.2)	-	-
Balance at end of the year	-	425.6	478.7

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FOR THE YEAR ENDED 31 DECEMBER 2019

26.8 Fair value of financial instruments and risk management

Fair value of borrowings

The fair value of variable interest rate borrowings approximates its carrying amounts as the interest rates charged are considered marked related. Fair value of fixed interest rate borrowings was determined through reference to ruling market prices and interest rates.

The fair value of the derivative financial instrument is estimated based on ruling market prices, volatilities and interest rates, option pricing methodologies based on observable quoted inputs, and constitute a level 2 instrument on the fair value hierarchy.

The table below shows the fair value and carrying amount of borrowings where the carrying amount does not approximate fair value:

	Carrying value		Fair value
Figures in million - SA rand		Level 1		Level 2	Level 3
31 December 2019	9,609.8	10,138.4		-	-
2022 and 2025 Notes
US$ Convertible Bond1	4,578.6	-		4,724.5	-
Burnstone Debt2	1,330.4	-		-	1,441.0
Total	15,518.8	10,138.4		4,724.5	1,441.0
31 December 2018	9,808.7	9,312.0	-	-
2022 and 2025 Notes
US$ Convertible Bond1	4,496.6	-	3,736.1	-
Burnstone Debt2	1,145.1	-	-	1,075.6
Total	15,450.4	9,312.0	3,736.1	1,075.6
31 December 2017	12,597.7	13,295.3	-	-
2022 and 2025 Notes
US$ Convertible Bond1	4,357.1	-	4,239.1	-
Burnstone Debt2	1,537.5	-	-	1,536.5
Total	18,492.3	13,295.3	4,239.1	1,536.5

1. The fair value of the amortised cost component of the US$ Convertible Bond is based on the quoted price of the instrument after separating the fair value of the derivative component
2. The fair value of the Burnstone Debt been derived from discounted cash flow models. These models use several key assumptions, including estimates of future sales volumes, Gold prices, operating costs, capital expenditure and discount rate

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FOR THE YEAR ENDED 31 DECEMBER 2019

Liquidity risk

The following are contractually due, undiscounted cash flows resulting from maturities of financial liabilities including interest payments:

		Within one	Between	After five
Figures in million - SA rand	Total	one and
year	five years	years
31 December 2019	3,808.6	775.4	2,918.6	114.6
Other payables
Trade and other payables	7,739.5	7,739.5	-	-
Borrowings	-
- Capital	-
US$600 million RCF	5,711.9	-	5,711.9	-
R5.5 billion RCF	2,500.0	-	2,500.0	-
2022 and 2025 Notes	9,808.4	-	4,951.8	4,856.6
US$ Convertible Bond	5,376.0	-	5,376.0	-
Burnstone Debt	109.0	-	109.0	-
Franco-Nevada liability	2.0	2.0	-	-
Stillwater Convertible Debentures	3.5	3.5	-	-
Other borrowings	-	-	-	-
- Interest	7,820.8	1,184.2	2,698.3	3,938.3
Total	42,879.7	9,704.6	24,265.6	8,909.5
31 December 2018
Other payables	3,386.8	293.3	1,968.9	1,124.6
Trade and other payables	5,159.9	5,159.9	-	-
Borrowings
- Capital
US$600 million RCF	2,726.5	-	2,726.5	-
R6.0 billion RCF	5,896.4	5,896.4	-	-
2022 and 2025 Notes	10,053.6	-	5,075.6	4,978.0
US$ Convertible Bond	5,510.4	-	5,510.4	-
Burnstone Debt	2,552.9	-	-	2,552.9
Franco-Nevada liability	2.0	2.0	-	-
Stillwater Convertible Debentures	3.8	3.8	-	-
Other borrowings	252.3	252.3	-	-
- Interest	9,386.9	1,543.8	3,568.6	4,274.5
Total	44,931.5	13,151.5	18,850.0	12,930.0

Market risk

Foreign currency sensitivity

Certain of the Group's US dollar borrowing facilities have been drawn down by Companies with SA Rand as their functional currency, therefore some of the Groups borrowings are sensitive to changes in the rand/US dollar exchange rate. A one percentage point depreciation in the SA rand closing exchange rate of R14.00/US$ (2018: R14.35/US$ and 2017: R12.36/US$) would have reduced the gain on foreign exchange differences by R102.2 million (2018: R38.7 million and 2017: R81.2 million). A one percentage point appreciation in the exchange rate would have increased the gain on foreign exchange differences by R102.2 million (2018: R38.7 million and 2017: R81.2 million).

Interest rate sensitivity

As at 31 December 2019, the Group's total borrowings amounted to R23,736.2 million (2018: R24,504.7 million and 2017:

R25,649.5 million). The Group generally does not undertake any specific action to cover its exposure to interest rate risk, although it may do so in specific circumstances.

The portion of Sibanye-Stillwater'sinterest-bearing borrowings at period end that is exposed to interest rate fluctuations is

R23,730.7 million (2018: R24,498.9 million and 2017: R25,644.5 million). This debt is normally rolled for periods between one and three months and is therefore exposed to the rate changes in this period.

At 31 December 2019, of the total borrowings, R2,500.0 million (2018: R6,322.0 million and 2017: R6,015.1 million) is exposed to changes

in the JIBAR rate and R7,042.3 million (2018: R3,871.6 million and 2017: R2,674.6 million) is exposed to changes in the LIBOR rate.

The table below summarises the effect of a change in finance expense on the Group's profit or loss had JIBAR and LIBOR differed as indicated. The analysis is based on the assumption that the applicable interest rate increased/decreased with all other variables held constant. All financial instruments with fixed interest rates that are carried at amortised cost are not subject to the interest rate sensitivity analysis.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Interest rate sensitivity analysis

	Change in interest expenses for a change in interest rate1
Figures in million - SA rand	-1.5%	-1.0%	-0.5%	0.5%	1.0%	1.5%
31 December 2019	37.5	25.0	12.5	(12.5)	(25.0)	(37.5)
- JIBAR
- LIBOR	105.6	70.4	35.2	(35.2)	(70.4)	(105.6)
Change in finance expense	143.1	95.4	47.7	(47.7)	(95.4)	(143.1)
31 December 2018
- JIBAR	88.5	59.0	29.5	(29.5)	(59.0)	(88.5)
- LIBOR	79.2	52.8	26.4	(26.4)	(52.8)	(79.2)
Change in finance expense	167.7	111.8	55.9	(55.9)	(111.8)	(167.7)

1 Interest rate sensitivity analysis is performed on the borrowings balance at 31 December

The exposure to interest rate changes and the contractual repricing dates

The exposure of the Group's borrowings to interest rate changes and the contractual repricing dates at the reporting dates is as follows:

Figures in million - SA rand	2019	2018	2017
Floating rate with exposure to change in JIBAR	2,500.0	6,322.0	6,015.1
Floating rate with exposure to change in LIBOR	7,042.3	3,871.6	2,674.6
Non-current borrowings exposed to interest rate changes	9,542.3	10,193.6	8,689.7
The Group has the following undrawn borrowing facilities:	5,688.0
Committed	5,987.1	3,652.5
Uncommitted	1,050.0	757.7	471.3
Total undrawn facilities	6,738.0	6,744.8	4,123.8
All of the above facilities have floating rates. The undrawn
committed facilities have the following expiry dates:	-
- within one year	103.6	3,188.9
- later than one year and not later than two years	672.0	-	463.6
- later than two years and not later than three years	5,016.0	5,883.5	-
Total undrawn committed facilities	5,688.0	5,987.1	3,652.5

26.9 Capital management

The Group's primary objective with regards to managing its capital is to ensure that there is sufficient capital available to support the funding requirements of the Group, including capital expenditure, in a way that: optimises the cost of capital; maximises shareholders' returns; and ensures that the Group remains in a sound financial position.

The Group manages and makes adjustments to the capital structure as and when borrowings mature or as and when funding is required. This may take the form of raising equity, market or bank debt or hybrids thereof. Opportunities in the market are also monitored closely to ensure that the most efficient funding solutions are implemented.

The Group monitors capital using the ratio of net debt to adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA), but does not set absolute limits for this ratio.

Net debt to adjusted EBITDA at 31 December 2019 of 1.4 exceeds the Group's targeted ratio of net debt to adjusted EBITDA of 1.0:1 or lower. Utilising the committed unutilised debt facilities above, will impact on the leverage ratio. The borrowing facilities permit a leverage ratio of 3.5:1 through to 31 December 2019, and 2.5:1 thereafter, calculated on a quarterly basis. Sibanye-Stillwater plans to deleverage over time back to its targeted leverage ratio of no greater than 1.0:1.

Figures in million - SA rand	2019	2018	2017
Borrowings1	26,550.7	23,768.5	25,205.5
Cash and cash equivalents2	5,586.3	2,499.4	2,029.8
Net debt3	20,964.4	21,269.1	23,175.7
Adjusted EBITDA4	14,956.0	8,369.4	9,045.1
Net debt to adjusted EBITDA (ratio)5	1.4	2.5	2.6

1. Borrowings are only those borrowings that have recourse to Sibanye-Stillwater. Borrowings, therefore, exclude the Burnstone Debt and include the derivative financial instrument
2. Cash and cash equivalents exclude cash of Burnstone
3. Net debt represents borrowings and bank overdraft less cash and cash equivalents. Borrowings are only those borrowings that have recourse to Sibanye- Stillwater and therefore exclude the Burnstone Debt and include the derivative financial instrument. Net debt excludes cash of Burnstone
4. The adjusted EBITDA calculation is based on the formula included in the facility agreements for compliance with the debt covenant formula. Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Adjusted EBITDA is not a measure of performance under IFRS and should be considered in addition to, and not as a substitute for, other measures of financial performance and liquidity
5. Net debt to adjusted EBITDA ratio is defined as net debt as at the end of a reporting period divided by adjusted EBITDA of the 12 months ended on the same reporting date

Sibanye-Stillwater Annual Financial Report 2019

104

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Reconciliation of loss before royalties, carbon tax and tax to adjusted EBITDA:

Figures in million - SA rand	2019	2018	2017
Loss before royalties, carbon tax and tax	(856.3)	(1,224.3)	(6,981.2)
Adjusted for:	7,214.1
Amortisation and depreciation	6,613.8	5,699.7
Interest income	(560.4)	(482.1)	(415.5)
Finance expense	3,302.5	3,134.7	2,971.8
Share-based payments	363.3	299.4	231.9
Loss/(gain) on financial instruments	6,015.1	(1,704.1)	1,114.4
Gain on foreign exchange differences	(325.5)	(1,169.1)	(292.4)
Share of results of equity-accounted investees after tax	(721.0)	(344.2)	(291.6)
Change in estimate of environmental rehabilitation obligation,	88.9
and right of recovery receivable and payable	(66.6)	248.9
Gain on disposal of property, plant and equipment	(76.6)	(60.2)	(40.7)
Impairments	86.0	3,041.4	4,411.0
Gain on derecognition of borrowing and derivative financial instrument	-	(230.0)	-
Gain on acquisition	(1,103.0)	-	-
Restructuring costs	1,252.4	142.8	729.8
Transaction costs	447.8	402.5	552.1
IFRS 16 lease payments	(131.7)	-	-
Occupational healthcare expense	(39.6)	15.4	1,106.9
Adjusted EBITDA	14,956.0	8,369.4	9,045.1

27. Lease liabilities

Accounting policy

At the inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

Lease liabilities are initially measured at the present value of the future lease payments at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the relevant incremental borrowing rate.

Subsequently, lease liabilities are measured at amortised cost using the effective interest method. Lease liabilities are remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Group's estimate of the amount expected to be payable under a residual value guarantee, or if the Group changes its assessment of whether it will exercise a purchase, extension or termination option.

When the lease liability is measured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The Group also elected to apply the recognition exemptions for lease contracts that, at the commencement date, have a lease term of 12 months or less and do not contain a purchase option, and lease contracts for which the underlying asset is of low value. The Group recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term to the extent applicable.

In addition, certain variable lease payments are not permitted to be recognised as lease liabilities and are expensed as incurred.

Figures in million - SA rand	Notes	2019	2018	2017
Impact of adopting IFRS 16 on 1 January 2019	1	302.0	-	-
New leases and modifications		51.5
Lease liabilities on acquisition of subsidiaries	14.1	133.3	-	-
Repayment of lease liabilities		(131.7)	-	-
Interest charge	5	33.9	-	-
Re-classification and other		(5.7)	-	-
Foreign currency translation		(0.5)	-	-
Balance at end of the year		382.8	-	-
Current portion of lease liabilities		(110.0)	-	-
Non-current lease liabilities		272.8	-	-

Sibanye-Stillwater Annual Financial Report 2019

105

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Lease payments not recognised as a liability but expensed during the year

Figures in million - SA rand	2019
Short-term leases	43.4
Leases of low value assets	54.2
Variable lease payments	13.1
Total	110.7

Maturity Analysis

The lease liabilities are secured by the related underlying assets. The undiscounted maturity analysis of lease liabilities at 31 December

2019 is as follows:

			Between
		Within one	one and	After five
Figures in million - SA rand	Total	year	five years	years
Contractual undiscounted cash flows	474.9	140.0	297.8	37.1

28. Environmental rehabilitation obligation and other provisions

Significant accounting judgements and estimates

The Group's mining and exploration activities are subject to various laws and regulations governing the protection of the environment. The Group recognises management's best estimate for asset retirement obligations in the period in which they are incurred. Actual costs incurred in future periods could differ materially from the estimates. Additionally, future changes to environmental laws and regulations, life of mine estimates and discount rates could affect the carrying amount of this provision.

The provision is calculated using the following assumptions:

2019	Inflation rate	Discount rate	LOM
SA gold operations	6%	6.69% - 9.99%	1 - 19 years
SA PGM operations	6%	6.69% - 10.09%	1 - 31 years
US PGM operations	2%	2.32% - 2.39%	25 - 37 years
2018
SA gold operations	6%	6.27% - 9.73%	1 - 19 years
SA PGM operations	6%	6.27% -9.81%	1 - 28 years
US PGM operations	2%	2.87% -3.02%	26 - 38 years

Accounting policy

Provisions are recognised when the Group has a present obligation, legal or constructive resulting from past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

Long-term environmental obligations are based on the Group's environmental management plans, in compliance with applicable environmental and regulatory requirements.

The estimated costs of rehabilitation are reviewed annually and adjusted as appropriate for changes in legislation, technology or other circumstances. Cost estimates are not reduced by the potential proceeds from the sale of assets or from plant clean up at closure.

Based on disturbances to date, the net present value of expected rehabilitation cost estimates is recognised and provided for in full in the financial statements. The estimates are reviewed annually and are discounted using a risk-free rate that is adjusted to reflect the current market assessments of the time value of money.

Annual changes in the provision consist of finance costs relating to the change in the present value of the provision and inflationary increases in the provision estimate, as well as changes in estimates. Changes in estimates are capitalised or reversed against the relevant asset or liability to the extent that it meets the definition of dismantling and removing the item and restoring the site on which it is located. Costs that relate to an existing condition caused by past operations and do not have a future economic benefit are recognised in profit or loss. If a decrease in the liability exceeds the carrying amount of the asset, the excess is recognised immediately in profit or loss. The present value of environmental disturbances created are capitalised to mining assets against an increase in the environmental rehabilitation obligation.

Rehabilitation projects undertaken, included in the estimates are charged to the provision as incurred. The cost of ongoing current programmes to prevent and control environmental disturbances is recognised in profit or loss as incurred. The unwinding of the discount due to the passage of time is recognised as finance cost, and the capitalised cost is amortised over the remaining lives of the mines.

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106

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Figures in million - SA rand	Note	2019	2018	2017
Balance at beginning of the year		6,294.2	4,678.7	3,982.2
Interest charge	5	578.7	398.8	357.1
Payment of environmental rehabilitation obligation1		(34.9)	(32.3)	(26.9)
Change in estimates charged to profit or loss2		88.9	(90.4)	248.9
Change in estimates capitalised2		105.1	618.8	(177.7)
Environmental rehabilitation obligation on acquisition of subsidiaries	14	1,696.9	672.7	312.1
Foreign currency translation		(14.1)	47.9	(17.0)
Balance at end of the year		8,714.8	6,294.2	4,678.7
Environmental rehabilitation obligation and other provisions consists of:		8,597.6
Environmental rehabilitation obligation		6,176.2	4,678.7
Other provisions		117.2	118.0	-
Environmental rehabilitation obligation and other provisions		8,714.8	6,294.2	4,678.7

1. The cost of ongoing current programmes to prevent and control environmental disturbances, including reclamation activities, is charged to cost of sales as incurred
2. Changes in estimates are defined as changes in reserves and corresponding changes in life of mine, changes in discount rates, and changes in laws and regulations governing environmental matters

The Group's mining operations are required by law to undertake rehabilitation works as part of their ongoing operations. The Group makes contributions into environmental rehabilitation obligation funds (refer note 19) and holds guarantees to fund the estimated costs.

Post closure water management liability

The Group continues to monitor the potential risk of long-term Acid Mine Drainage (AMD) and other groundwater pollution challenges also experienced by peer mining groups. AMD relates to the acidification and contamination of naturally occurring water resources by pyrite- bearing ore contained in underground mines, in rock dumps, tailings dams and pits on the surface. As yet, the Group has not been able to reliably determine the financial impact that AMD and groundwater pollution may have on the Group, nor the timing of possible outflow. The potential for AMD generation and other groundwater impacts how, where and if they will manifest and the associated environmental/closure liability will be determined as part of the Group's quantification of any post-closure latent and residual environmental impacts using a robust and defendable risk assessment process - this will be a requirement in the proposed amended Financial Provisioning (FP) Regulations that comes into effect in June 2021. As per the recent closure process undertaken at our Cooke Operations, detailed studies to understand the hydrology and hydrogeology were undertaken. These studies further included the modeling of the mined out void, re-watering rate and natural groundwater flow in the dolomite aquifer overlaying the mined-out area. The conclusions from the studies were used to inform a risk assessment and closure strategy to reliably predict water quality impacts as part of long term sustainable closure solution. In addition, in the December 2019 closure liability assessments, the Group makes financial provision of R965.3 million (undiscounted) for what it specifically termed "Post Closure Aspects" - this includes but is not limited to amongst others, post-closure water management aspects such as initial and post-decant surface and groundwater monitoring, wetlands, biomonitoring and aquatics monitoring and care-and-maintenance monitoring.

The Group, has a robust water conservation and demand management, compliance and closure water management strategy that aims to define and sustainably mitigate the potential risk of AMD and groundwater pollution. The Group operates a comprehensive water quality monitoring program, including bio-monitoring, as an early detection of potential AMD and groundwater pollution and has launched an initiative to understand the mining impacts on the various catchments within which the Group operates.

29. Occupational healthcare obligation

Significant accounting judgements and estimates

The Group recognises management's best estimates to settle any occupational healthcare claims against the Group's operations. The ultimate outcome of these matters remains uncertain, with a possible failure to reach a settlement or to obtain the requisite court approval for a potential settlement. The provision is consequently subject to adjustment in the future, depending on the progress of the Occupational Lung Disease Group (the Working Group) discussions, stakeholder engagements and the ongoing legal proceedings. Actual costs incurred in future periods could differ materially from the estimates.

Estimates that were used in the assessment include value of benefits, required contributions, timing of payments, tracing pattern, period discount rates, period inflation rates and a 60% take-up rate. These estimates were informed by a professional opinion.

Management discounted the possible cash outflows using a discount rate of 8.25% (2018: 8.83% and 2017: 8.604).

Accounting policy

Provisions are recognised when the Group has a present obligation, legal or constructive resulting from past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

The estimated costs of settlement claims are reviewed at least annually and adjusted as appropriate for changes in cash flow predictions or other circumstances.

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107

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Based on estimates to date, the net present value of expected settlement claims is recognised and provided for in full in the financial statements. The estimated cash flows are discounted using a risk-free rate with similar terms to the obligation to reflect the current market assessments of the time value of money.

Annual changes in the provision consist of finance costs relating to the change in the present value of the provision and changes in estimates.

On 3 May 2018, the Occupational Lung Disease Working Group (the Working Group), including the Sibanye-Stillwater Group, agreed to an approximately R5 billion class action settlement with the claimants. The estimated costs were reviewed at 31 December 2018 and discounted using a risk-free rate.

On 26 July 2019 the Gauteng High Court in Johannesburg approved the R5 billion settlement agreement in the silicosis class case. This settlement agreement provides compensation to all eligible workers suffering from silicosis and/or tuberculosis who worked in the Occupational Lung Disease Working Group companies' mines from 12 March 1965 to the date of the settlement agreement. Sibanye- Stillwater currently has provided R1,282.1 million for its share of the settlement cost. The provision is consequently subject to adjustment in the future based on the number of eligible workers.

On 19 December 2019 Sibanye Stillwater provided a guarantee for an amount not exceeding R1,372 million in respect of trust administration contributions, initial benefit contributions and benefit contributions as required by the Trust Deed.

Figures in million - SA rand	Note	2019	2018	2017
Balance at beginning of the year		1,274.1	1,153.3	-
Occupational healthcare obligation recognised		-	-	1,077.2
Interest charge	5	115.5	105.4	46.4
Change in estimate charge to profit or loss		(39.6)	15.4	29.7
Payments made		(67.9)	-	-
Balance at the end of the year		1,282.1	1,274.1	1,153.3
Reconciliation of the non-current and current portion of the occupational healthcare
obligation:		1,282.1
Occupational healthcare obligation		1,274.1	1,153.3
Current portion of occupational healthcare obligation		(148.7)	(109.9)	(0.8)
Non-current portion of occupational healthcare obligation		1,133.4	1,164.2	1,152.5

DRDGOLD is not a party to the Working Group's mediated settlement agreement and DRDGOLD maintains the view that it is too early to consider settlement of the matter, mainly for the following reasons:

• the applicants have as yet not issued and served a summons (claim) in the matter to DRDGOLD;
• there is no indication of the number of potential claimants that may join the class action against the DRDGOLD respondents; and
• many principles upon which legal responsibility may be founded, are required to be substantially developed by the trial court (and possibly subsequent courts of appeal) to establish liability on the bases alleged by the applicants.

In light of the above there is inadequate information for DRDGOLD to determine if a sufficient legal and factual basis exists to establish liability, and to quantify such potential liability.

30. Deferred revenue

Significant accounting judgements and estimates

Upfront cash deposits received for streaming transactions have been accounted for as contract liabilities (deferred revenue) in the scope of IFRS 15. These contracts are not financial instruments because they will be satisfied through the delivery of non-financial items (i.e. delivering of metal ounces) as part of the Group's expected sale requirements, rather than cash or financial assets. It is the intention to satisfy the performance obligations under these streaming arrangements through the Group's production, and revenue will be recognised over duration of the contracts as the Group satisfies its obligation to deliver metal ounces. Since these contracts are of a long-term nature and the Group received a portion of the consideration at the inception, these contracts contain a significant financing component under IFRS 15. The Group therefore made a critical estimate of the discount rate that should be applied to the contract liabilities over the life of contracts.

Inputs to the model to unwind the Wheaton advance received to revenue

The advance received has been recognised on the statement of financial position as deferred revenue. The deferred revenue will be recognised as revenue in profit or loss based on the metal ounces/credits in relation to the expected total amount of metal credits to be delivered over the term of the arrangement.

Each period management estimates the cumulative amount of the deferred revenue obligation that has been satisfied and, therefore, recognised as revenue. Key inputs into the model are:

Key input		Estimate at year end		Further information
Estimated financing rate		4.6% - 5.2%		Refer note 5
over life of arrangement

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108

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Remaining life of stream

67 years

Palladium entitlement	4.5%
percentage
Monthly cash percentage	18%

Commodity prices Five day simple average

calculated the day before delivery

The starting point for the life of mine is the approved life of mine for the US PGM operations. However, as IFRS 15 requires the constraint on revenue recognition to be considered, it is more prudent to include a portion of resources in the life ofstream for the purposes of revenue recognition. This will reduce the chance of having a significant decrease in revenue recognised in the future, when the life ofmine is updated to include a conversion of resources to reserves.

As such, Sibanye-Stillwater management have determined that is it appropriate to include 50% of inferred resources.

The palladium entitlement percentage will be either 4.5%, 2.25% or 1% over the life of the mine, depending on whether or not the advance has been fully utilised,and a certain number of contractual ounces have been delivered (375,000 ounces for the first trigger drop down to 2.25% and 550,000oz for the second trigger drop down rate to 1%).

The monthly cash payment to be received is a percentage of 18%, 16%, 14% or 10% of the market price of the metal credit delivery to Wheaton International while the advance is not fully utilised. After the advance has been fully utilised, the cash percentage is 22%, 20%, 18% or 14%. The percentage applicable depends on the investment grade of the Group and its leverage ratio. As long asSibanye-Stillwater's current investment grade conditions as stipulated in the contract have been satisfied, the monthly cash percentage decreases if the Group's leverage ratio increases above 3.5:1. The balance of the ounces in the monthly delivery (i.e. 100%-18%=82%) is then used to determine the utilisationof the deferred revenue balance.

The value of each metal credit delivery is determined in terms of the contract.

Any changes to the above key inputs could significantly change the quantum of the cumulative revenue amount recognised in profit or loss.

Any changes in the life of mine are accounted for prospectively as a cumulative catch-up in the year that the life of mine estimate above changes, or the inclusion of resources changes.

Inputs to the model to unwind the BTT advance received to revenue

The advance received has been recognised on the statement of financial position as deferred revenue. The deferred revenue will be recognised as revenue in profit or loss based on the metal ounces/credits in relation to the expected total amount of metal credits to be delivered over the term of the arrangement.

Each period management estimates the cumulative amount of the deferred revenue obligation that has been satisfied and, therefore, recognised as revenue. Key inputs into the model are:

						Further information
Estimated financing rate			11.5%			Refer note 5
over life of arrangement
Remaining life of stream			6 years			The life of the stream is determined by the reserves of the Marikana Easterns'
	23%			Tailings Dam no.1.
6E PGM entitlement			The 6E PGM entitlement percentage ranges from 23% to 38% based on a
percentage						weighted 6E PGM basket price that is determined monthly.
Monthly cash percentage	20%			The monthly cash payment to be received is a percentage of the 6E PGM
						weighted basket price, ranging from 16% to 20%, and is based on a weighted 6E
						PGM basket price that is determined monthly. This cash payment is caped at a
						minimum of $106 per ounce and a maximum of $280 per ounce.
Commodity prices			Average monthly basket			The monthly basket price for any calendar month is calculated by dividing the
			price			sum of the monthly average value of weighted 6E PGM basket by the total
						number of ounces for such calendar month.

Any changes to the above key inputs could significantly change the quantum of the cumulative revenue amount recognised in profit or loss.

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109

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

Any changes in the life of mine or 6E PGM entitlement are accounted for prospectively as a cumulative catch-up in the year that the life of mine estimate above changes.

Accounting policy

Consideration received in advance is recognised as a contract liability (deferred revenue) under IFRS 15 as control has not yet transferred.

Sibanye-Stillwater management identified a significant financing component related to its streaming arrangements resulting from the difference in the timing of the advance consideration received and when control of the metal promised transfers. Interest expense on deferred revenue is recognised in finance costs.

In July 2018, Sibanye-Stillwater entered into a gold and palladium supply arrangement in exchange for an upfront advance payment of US$500 million. The arrangement has been accounted for as a contract in the scope of IFRS 15 whereby the advance payment has been recorded as deferred revenue. The revenue from the advance payment is being recognised as the gold and palladium is allocated to the appropriate Wheaton International account. An interest cost, representing the significant financing component of the upfront deposit on the deferred revenue balance, is also being recognised as part of finance costs. This finance cost increases the deferred revenue balance, ultimately resulting in revenue when the deferred revenue is recognised over the life of mine.

On 11 April 2019, Sibanye-Stillwater concluded a forward gold sale arrangement whereby the Group received a cash prepayment of

US$125 million (approximately R1.75 billion) in exchange for 4 fortnightly deliveries of 26,476 ounces of gold (totaling 105,906 ounces or 3,294 kilograms) between 1 October 2019 and 15 November 2019. The revenue from the prepayment was recognised in four equal parts on delivery of the gold. The gold price delivered under the prepayment was hedged with a cap price of $1,323 per ounce and a floor price of $1,200 per ounce. Sibanye-Stillwater received, and recognised, the difference between the floor price and the spot price (subject to a maximum of the cap price) on delivery of the gold.

On 21 October 2019, Sibanye-Stillwater concluded a forward gold sale arrangement whereby the Group received a cash prepayment of R1.1 billion in exchange for 8 fortnightly deliveries of 8,482 ounces of gold (totaling 67,856 ounces or 2,111 kilograms) between 10 July 2020 and 16 October 2020. The revenue from the prepayment will be recognised in eight equal parts on delivery of the gold. The gold price delivered under the prepayment is unhedged and Sibanye-Stillwater will receive (or pay) the difference between the spot price and the prepayment price of R17,371 per ounce (being R558,491 per kilogram).

During 2016 Lonmin secured competitive funding of $50 million to build the Bulk Tailings re-Treatment plant (BTT), through a finance metal streaming arrangement receivable in instalments. The $50 million has been accounted for as deferred revenue as it will be repaid by way of discounted value of 6E metal sales. Contractual deliveries will be at a discounted price and the value of the discount over and above the $50 million upfront payment will be recognised over the project lifetime and charged to the consolidated income statement as a finance expense. The plant was commissioned during February 2018. Sibanye-Stillwater determined the carrying value of the BTT deferred revenue to be R628 million at acquisition and R607 million at 31 December 2019.

The following table summarises the changes in deferred revenue:

	Figures in million - SA rand	Note	2019	2018	2017
	Balance at beginning of the year		6,555.4	-
	Deferred revenue advance received		2,859.3	6,555.4	-
	Deferred revenue recognised during the period		(2,227.5)	(160.3)	-
	Interest charge	5	352.3	160.3	-
	Deferred revenue recognised on acquisition of subsidiary		627.6	-	-
	Balance at the end of the year		8,167.1	6,555.4	-
	Reconciliation of the non-current and current portion of the deferred revenue:		8,167.1
	Deferred revenue		6,555.4	-
	Current portion of deferred revenue		(1,270.6)	(30.1)	-
	Non-current portion of deferred revenue		6,896.5	6,525.3	-

31. Trade and other payables

Accounting policy

Trade and other payables, excluding payroll creditors and leave pay accrual are non-derivative financial liabilities categorised as other financial liabilities. Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

Provision is made for employee entitlement benefits accumulated as a result of employees rendering services up to the reporting date. Liabilities arising in respect of wages and salaries, annual leave and other benefits due to be settled within 12 months of the reporting date are measured at rates which are expected to be paid when the liability is settled. Termination benefits are expensed at the earlier of when the Group can no longer withdraw the offer of those benefits and when the Group recognises costs for a restructuring. If benefits are not expected to be settled wholly within 12 months of the reporting date, then they are discounted.

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110

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

All other employee entitlement liabilities are measured at the present value of estimated payments to be made in respect of services rendered up to reporting date.

Figures in million - SA rand	2019	2018	2017
Trade creditors	3,208.0	2,200.0	1,728.1
Accruals and other creditors	3,195.6	2,952.7	2,380.6
Other1	1,335.9	7.2	18.5
Financial liabilities	7,739.5	5,159.9	4,127.2
Payroll creditors	1,898.2	1,465.3	1,253.5
Leave pay accrual	1,692.5	1,152.6	1,160.5
VAT payable	135.7	78.5	149.2
Total trade and other payables	11,465.9	7,856.3	6,690.4

1 Included in other is an amount of R1,227.8 which related to the Kroondal pipeline creditor

Fair value of trade and other payables

The fair value of trade and other payables approximate the carrying value due to the short maturity.

Liquidity risk

Trade and other creditors are expected to be settled within 12 months from the reporting date.

32. Cash generated by operations

Figures in million - SA rand	Notes	2019	2018	2017
Profit/(Loss) for the year		432.8	(2,520.7)	(4,433.1)
Royalties	9.1	431.0	212.6	398.5
Carbon tax		12.9	-	-
Mining and income tax	9.2	(1,733.0)	1,083.8	(2,946.6)
Interest income		(560.4)	(482.1)	(415.5)
Finance expense	5	3,302.5	3,134.7	2,971.8
Profit/(Loss) before interest, royalties and tax		1,885.8	1,428.3	(4,424.9)
Non-cash and other adjusting items:		7,214.1
Amortisation and depreciation	4	6,613.8	5,699.7
Share-based payments	6	363.3	299.4	231.9
Loss/(gain) on financial instruments		5,731.3	(1,591.3)	764.0
Gain on foreign exchange differences		(461.4)	(241.3)	(546.8)
Share of results of equity-accounted investees after tax	16	(721.0)	(344.2)	(291.6)
Impairments	8	86.0	3,041.4	4,411.0
Gain on derecognition of borrowings and derivative financial instrument		-	(230.0)	-
Occupational healthcare expense	29	(39.6)	15.4	1,106.9
Gain on acquisition	14.1	(1,103.0)	-	-
Deferred revenue recognised	30	(2,227.5)	-	-
Other		(162.1)	(282.5)	147.7
Total cash generated by operations		10,565.9	8,709.0	7,097.9

33. Change in working capital
		Figures in million - SA rand	2019	2018	2017
		Inventories	(5,000.0)	(924.8)	(937.7)
		Trade and other receivables	3,115.2	(461.0)	(214.9)
		Trade and other payables	1,259.2	315.8	630.3
		Total change in working capital	(625.6)	(1,070.0)	(522.3)

34. Financial instruments and risk management Accounting policy

On initial recognition, a financial asset is classified as measured at either amortised cost, fair value through other comprehensive income, or fair value through profit or loss.

The Group initially recognises debt instruments issued and trade and other receivables, on the date these are originated. All other financial assets and financial liabilities are recognised initially when the Group becomes a party to the contractual provisions of the instrument.

The classification of financial assets at initial recognition that are debt instruments depends on the financial asset's contractual cash flow characteristics and the Group's business model for managing them. In order for a financial asset to be classified and measured at amortised cost, it needs to give rise to cash flows that are solely payments of principal and interest (SPPI) on the principal amount

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

outstanding. This assessment is performed at an instrument level. Financial assets with cash flows that are not SPPI are classified and measured at fair value through profit or loss, irrespective of the business model.

The Group's business model for managing financial assets that are debt instruments refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Financial assets classified and measured at amortised cost are held within a business model with the objective to hold financial assets in order to collect contractual cash flows.

The Group recognises an allowance for expected credit losses (ECLs) on all debt instruments not held at fair value through profit or loss to the extent applicable. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original effective interest rate.

ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).

For trade and other receivables due in less than 12 months, the Group applies the simplified approach in calculating ECLs, as permitted by IFRS 9. Therefore, the Group does not track changes in credit risk, but instead, recognises a loss allowance based on the financial asset's lifetime ECL at each reporting date. Impairment losses are recognised through profit or loss.

The Group derecognises a financial asset when the contractual rights to the cash flows in a transaction in which substantially all the risks and rewards of the ownership of the financial asset are transferred. The Group derecognises a financial liability when its contractual obligations are discharged, cancelled or expired. Any interest in such transferred financial asset that is created or retained by the Group is recognised as a separate asset or liability. The particular recognition and measurement methods adopted are disclosed in the individual policy statements associated with each item.

On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid is recognised in profit or loss.

34.1 Accounting classifications and measurement of fair values

The following methods and assumptions were used to estimate the fair value of each class of financial instrument:

• Other receivables and other payables
  Due to the approaches applied in calculating the carrying values as described in note 20, the fair values approximate the carrying value.
• Trade and other receivables/payables, and cash and cash equivalents
  The carrying amounts approximate fair values due to the short maturity of these instruments for financial instruments measured at amortised cost. The fair value for trade receivables measured at fair value through profit or loss (PGM concentrate sales) are determined based on ruling market prices, volatilities and interest rates.
• Investments and environmental rehabilitation obligation funds
  The fair value of publicly traded instruments is based on quoted market values. The environmental rehabilitation obligation funds are stated at fair value based on the nature of the funds' investments.
• Other investments
  The fair values of listed investments are based on the quoted prices available from the relevant stock exchanges. The carrying amounts of other short-term investment products with short maturity dates approximate fair value. The fair values of non-listed investments are determined through valuation techniques that include inputs that are not based on observable market data.
• Borrowings
  The fair value of variable interest rate borrowings approximates its carrying amounts as the interest rates charged are considered marked related. However, since there is also fixed interest rate borrowings, fair values are disclosed in note 26.
• Derivative financial instruments

The fair value of derivative financial instruments is estimated based on ruling market prices, volatilities and interest rates, option pricing methodologies based on observable quoted inputs. All derivatives are carried on the statement of financial position at fair value.

The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments:

• Level 1: unadjusted quoted prices in active markets for identical asset or liabilities;
• Level 2: inputs other than quoted prices in level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

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FOR THE YEAR ENDED 31 DECEMBER 2019

The following table set out the Group's significant financial instruments measured at fair value by level within the fair value hierarchy:

Figures in million - SA rand

		2019			2018			2017
	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
Financial assets measured at fair value
- Environmental rehabilitation obligation funds	3,578.3	1,023.9	-	3,634.0	364.7	-	3,117.6	374.8	-
- Trade receivables - PGM concentrate sales	-	2,341.6	-	-	5,310.1	-	-	4,512.4	-
- Other investments	414.7	-	184.0	81.5	-	74.5	-	-	-
Financial liabilities measured at fair value	-	4,144.9	-
- Derivative financial instrument	-	408.8	-	-	1,093.5	-
- Rand gold forward sale contracts	-	68.3	-	-	240.8	-	-	-	-

In the normal course of its operations, the Group is exposed to market risks, including commodity price, foreign currency, interest rate, liquidity and credit risk associated with underlying assets, liabilities and anticipated transactions. In order to manage these risks, the Group has developed a comprehensive risk management process to facilitate control and monitoring of these risks.

34.2 Risk management activities

Controlling and managing risk in the Group

Sibanye-Stillwater has policies in areas such as counterparty exposure, hedging practices and prudential limits which have been approved by Sibanye-Stillwater's Board of Directors (the Board). Management of financial risk is centralised at Sibanye-Stillwater's treasury department (Treasury), which acts as the interface between Sibanye-Stillwater's Operations and counterparty banks. Treasury manages financial risk in accordance with the policies and procedures established by the Board and executive committee.

The Board has approved dealing limits for money market, foreign exchange and commodity transactions, which Treasury is required to adhere to. Among other restrictions, these limits describe which instruments may be traded and demarcate open position limits for each category as well as indicating counterparty credit-related limits. The dealing exposure and limits are checked and controlled each day and reported to the CFO.

The objective of Treasury is to manage all financial risks arising from the Group's business activities in order to protect profit and cash flows. Treasury activities of Sibanye-Stillwater and its subsidiaries are guided by the Treasury Policy, the Treasury Framework as well as domestic and international financial market regulations. Treasury activities are currently performed within the Treasury Framework with appropriate resolutions from the Board, which are reviewed and approved annually by the Audit Committee.

The financial risk management objectives of the Group are defined as follows:

• Liquidity risk management: the objective is to ensure that the Group is able to meet its short-term commitments through the effective and efficient management of cash and usage of credit facilities.
• Currency risk management: the objective is to maximise the Group's profits by minimising currency fluctuations.
• Funding risk management: the objective is to meet funding requirements timeously and at competitive rates by adopting reliable liquidity management procedures.
• Investment risk management: the objective is to achieve optimal returns on surplus funds.
• Interest rate risk management: the objective is to identify opportunities to prudently manage interest rate exposures.
• Counterparty exposure: the objective is to only deal with a limited number of approved counterparts that are of a sound financial standing and who have an official credit rating. The Group is limited to a maximum investment of 2.5% of the financial institutions' equity, which is dependent on the institutions' credit rating. The credit rating used is Fitch Ratings' short-term credit rating for financial institutions.
• Commodity price risk management: commodity risk management takes place within limits and with counterparts as approved in the treasury framework.

Credit risk

Credit risk represents risk that an entity will suffer a financial loss due to the other party of a financial instrument not discharging its obligation.

The Group has reduced its exposure to credit risk by dealing with a limited number of approved counterparties. The Group approves these counterparties according to its risk management policy and ensures that they are of good credit quality.

The carrying value of the financial assets represents the combined maximum credit risk exposure of the Group. Concentration of credit risk on cash and cash equivalents and non-current assets is considered minimal due to the abovementioned investment risk management and counterparty exposure risk management policies.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Liquidity risk

In the ordinary course of business, the Group receives cash proceeds from its operations and is required to fund working capital and capital expenditure requirements. The cash is managed to ensure surplus funds are invested to maximise returns whilst ensuring that capital is safeguarded to the maximum extent possible by investing only with top financial institutions.

Uncommitted borrowing facilities are maintained with several banking counterparties to meet the Group's normal and contingency funding requirements.

Working capital and going concern assessment

For the year ended 31 December 2019, the Group realised a profit of R432.8 million (31 December 2018: loss of R2,520.7 million). As at

31 December 2019 the Group's current assets exceeded its current liabilities by R11,836.9 million (31 December 2018: R562.7 million)

and the Group's total assets exceeded its total liabilities by R31,138.3 million (31 December 2018: R24,724.4 million). During the year

ended 31 December 2019 the Group generated net cash from operating activities of R9,464.0 million (31 December 2018: R12,197.2 million).

The Group had available undrawn debt facilities of R5,688 million at 31 December 2019 (2018: R5,987 million) and cash balances of

R5,619.0 million (31 December 2018: R2,549.1 million). On 11 November 2019 the R6.0 billion Revolving Credit Facility ("RCF") was refinanced by a R5.5 billion RCF maturing on 10 November 2022. US$150 million (R2,100 million) of the US$600 million RCF matures in April 2021, with the remainder of the facilities maturing after April 2022.

Sibanye-Stillwater's leverage ratio, based on the 12 month's financial results, (net debt to adjusted EBITDA) as at 31 December 2019 was 1.4:1 and its interest coverage ratio (adjusted EBITDA to net finance charges) was 6.5:1 (31 December 2018: 2.5:1 and 4.9:1). However, in terms of the allowed adjustments (annualised Marikana contribution to Group adjusted EBITDA) as per the facility agreements (net debt to adjusted EBITDA) as at 31 December 2019 was 1.25:1 and its interest coverage ratio (adjusted EBITDA to net finance charges) was 12.5:1. Both ratios are within the maximum permitted leverage ratio of at most 3.5:1 through to 31 December 2019, and 2.5:1 thereafter; and minimum required interest coverage ratio of 4.0:1, calculated on a quarterly basis, required under the US$600 million RCF and the R5.5 billion RCF (together the RCFs).

Various events during 2018 and 2019 (2018 safety issues, 2018/2019 gold strike and the SRPM offtake contract change from a purchase of concentrate to a toll processing arrangement) impacted negatively on group earnings and cash flows. Additionally, during 2019, the Group had to manage delays in the approval of the Lonmin acquisition, the take on of inherent uncertainties within the Lonmin business, alongside the now successfully concluded 3 yearly PGM wage negotiations. Liquidity levels were maintained throughout the year to manage this increased uncertainty. The Group issued 108.9 million ordinary shares for R1.7 billion on 15 April 2019 and executed a US$125 million (R1.8 billion) gold prepayment transaction on 11 April 2019, to enhance liquidity and balance sheet flexibility. A few days later, on 17 April 2019, AMCU, one of Sibanye-Stillwater's labour unions, withdrew its wage demands and ended its five-month strike action at the SA gold operations. In order to accommodate a potential breach in covenant ratios resulting from the impact of the strike at the SA Gold operations and the SRPM contract change, the RCF lenders approved a complete waiver of financial covenant compliance for the quarter ending 31 March 2019; and a leverage ratio of no more than 3.75:1 and an interest coverage ratio of at least 3.5:1 for the quarter ended 30 June 2019. Whilst the Group did not ultimately require these concessions, reporting a maximum leverage ratio of 2.98:1 and a minimum interest coverage ratio of 5.36:1 during 2019, it was deemed prudent to ensure that sufficient headroom was maintained within these financial covenants.

Gold and PGMs are sold in US dollars with most of the South African operating costs incurred in rand, as such the Group's results and financial condition will be impacted if there is a material change in the rand/US dollar exchange rate. High levels of volatility in commodity prices may also impact on profitability. Due to the nature of deep level mining, industrial and mining accidents may result in operational disruptions such as stoppages which could result in increased production costs as well as financial and regulatory liabilities. Further, Sibanye-Stillwater's operations may be adversely affected by production stoppages caused by labour unrests, union activity or other factors. The recent lockdown announced in South Africa due to the outbreak of COVID-19 (refer below) will adversely affect the 2020 production outlook for the South African operations. These factors will impact on cash generated or utilised by the Group, as well as adjusted EBITDA and financial covenants.

On 6 March 2020, Anglo American Platinum Limited (Anglo Plats) announced the temporary shutdown of its converter plant and issued a written notification of force majeure (FM) regarding the toll agreement between Anglo Plats and our Rustenburg operation and the purchase of concentrate agreement with our Kroondal and Platinum mile operations. Anglo Plats indicated that its converter plant will be unavailable for at least eight weeks (FM period). Sibanye-Stillwater reached agreement with Anglo Plats (refer note 38.7) regarding the processing of all PGM containing material produced from the Rustenburg and Platinum Mile operations and approximately half of the PGM containing material produced from the Kroondal operation, at our Marikana processing facilities for at least the duration of the FM period. These agreements are expected to largely offset the delayed smelting and refining impact of the FM event on the Sibanye-Stillwater operations, but could, under normal operating circumstances, result in an estimated inventory working capital lockup of up to R2.5 billion in the first half of 2020 that is expected to be released during the second half of 2020.

In addition, on 23 March 2020, the President of the Republic of South Africa announced a nation-wide lockdown for 21 days effective from midnight on 26 March 2020 following the outbreak of COVID-19 in South Africa. Sibanye-Stillwater implemented measures to place its SA Gold and SA PGM operations on care and maintenance, as required under the lockdown regulations. During this initial lockdown period there was no production from our South African operations and the following initiatives were implemented to preserve liquidity at these operations:

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FOR THE YEAR ENDED 31 DECEMBER 2019

• reduced variable overhead costs due to care and maintenance only, with costs limited to security, water pumping, ventilation, monitoring of infrastructure at shafts and plants and consumables associated with each activity;
• reduced labour cost from the third week of lockdown onwards; and
• force majeure announce to contractors not involved in the care and maintenance activity.

On 9 April 2020 the South African President announced that the lockdown period is extended for an additional 14 days. On 16 April 2020 a notice was published by the South African government which amended certain regulations previously issued in terms of Section 27(2) of the Disaster Management Act, 2002. These amendments, amongst others, allowed for South African mining operations to be conducted at a reduced capacity of not more than 50% during the period of lockdown, and thereafter at increasing capacity as determined by directives to be issued by the Minister of Mineral Resources and Energy. From 17 April 2020, management was in the process of implementing its strategy to mobilise the required employee complement and safely ramp up the South African operations to the initial 50% production capacity. This strategy includes:

• communications to employees and unions regarding the operational plan to ramp up production;
• start-uppreparations that include opening of services, ensuring appropriate ventilation, starting of belts, flushing of water pipes and consolidating impact of shutdown; and
• medical screening and training of employees to ensure a safe return to production.

In order to further proactively manage the COVID-19 threat at our US PGM operations and comply with the added requirements of local health authorities, a decision was made to reduce the number of people at our US sites, whilst maintaining production from current operations. Specific actions taken include:

• demobilising contractors involved in growth capital activities;
• facilitating remote work for personnel that are not required on site; and
• prohibiting face-to-face contact with external parties and restricting site access to employees.

The Blitz project accounts for the majority of contract workers at the US PGM operations and these decisions are likely to temporarily impact growth from Blitz in 2020 and delay the project's development schedule.

Management modeled various scenarios to determine the impact on the liquidity requirements of the Group of the Anglo Plats FM event, the extended lockdown in South Africa and the impact of COVID-19 limitations at the US PGM operations.

Management considered various scenarios that included the operational limitations in the United States as noted above, combined with:

• 42 day lockdown of mining operations in South Africa before returning to full mining activity;
• 21 day lockdown in South Africa, with the resumption of only Surface Operations for three months, before returning to full mining activity;
• 21 day lockdown in South Africa, with a resumption of operations with social distancing measures across all operations for three months before returning to full mining activity; and
• three month lockdown across all SA operations, alongside further reduced production output from the US operations before returning to full mining activity.

The scenario analysis included the following additional assumptions:

• average commodity prices for the remainder of the year: Gold ($1,600/oz), Palladium ($2,000/oz), Platinum ($750/oz) and Rhodium ($7,500/oz);
• average rand/ US dollar exchange rate for the remainder of the year: R18:US$1;
• production at SA operations modelled for a delayed ramp up to full production over two months subsequent to the lockdown period, based on experience from previous mine shut downs; and
• available liquidity at 31 March 2020 of R16.5 billion consisting of R0.2 billion committed undrawn debt, R1.7 billion of available uncommitted overnight facilities and R14.6 billion cash on hand.

While each of the scenarios result in a net utilisation of available liquidity, none of the scenarios result in an overall depletion of available liquidity. In each of the scenarios the Group expects to continue to meet its debt covenant requirements and remain liquid and solvent for at least a twelve month period after the date of approving these financial statements.

The Group has demonstrated its ability to proactively manage liquidity risk through various initiatives implemented during 2019. Improved geographical and commodity diversification, along with improved commodity prices, and increased operational scale should enable management to mitigate the impact of COVID-19, positioning the Group for a return to its targeted leverage ratio of 1:1. However, there are a number of uncertainties associated with COVID-19 that could have an adverse impact on the Group and its ability to comply with debt covenants and meet liquidity requirements. These uncertainties could include:

• turmoil in the world economy and the possible adverse impact over the short to medium term on the demand for PGMs and gold, commodity prices and rand/ US dollar exchange rates;
• possible further extension of the lockdown periods and/or delay in ramping up South African operations with an impact on production beyond the modeled scenarios described above;
• potential lockdown at the US PGM operations overlapping significantly with the lockdown at the South African operations;
• extended lockdown and delayed return to normal production by our suppliers and customers and the economies in which they operate;
• health and wellbeing of our employees after the extended lockdown; and

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FOR THE YEAR ENDED 31 DECEMBER 2019

• financial market disruption and limited access to funding opportunities.

The adverse impact of the above uncertainties or a combination thereof could further deteriorate the Group's forecasted liquidity position and may require the Group to further increase operational flexibility by adjusting mine plans, reducing capital expenditure and/or selling assets. The Group may also, if necessary, be required to consider options to increase funding flexibility which may include, amongst others, additional loan facilities or debt capital market issuances, streaming facilities, prepayment facilities or, in the event that other options are not deemed preferable or achievable by the Board, an equity capital raise. The Group could also, with lender approval, request covenant amendments or restructure facilities. During past adversity management has successfully implemented similar actions. However, the impact of COVID-19 on the global economy is unprecedented and unclear, and implementation of these actions could be challenging during the depressed economic environment caused by COVID-19.

While management acknowledge that there are uncertainties in modelling the different scenarios attributable to the COVID-19 pandemic, management remain confident that the Group's liquidity needs can be satisfied under any of the probable scenarios. The consolidated financial statements for the year ended 31 December 2019, therefore, have been prepared on a going concern basis.

Market risk

The Group is exposed to market risks, including foreign currency, commodity price and interest rate risk associated with underlying assets, liabilities and anticipated transactions. Following periodic evaluation of these exposures, the Group may enter into derivative financial instruments to manage some of these exposures.

The effects of reasonable possible changes of relevant risk variables on profit or loss or shareholders' equity are determined by relating the reasonable possible change in the risk variable to the balance of financial instruments at period end date.

The amounts generated from the sensitivity analyses are forward-looking estimates of market risks assuming certain adverse or favourable market conditions occur. Actual results in the future may differ materially from those projected results and therefore should not be considered a projection of likely future events and gains/losses.

Foreign currency risk

Sibanye-Stillwater's operations are all located in South Africa except for Stillwater and Mimosa, which are located in the US and Zimbabwe, respectively, and its revenues are sensitive to changes in the US dollar gold and PGM price and the rand/US dollar exchange rate (the exchange rate). Depreciation of the rand against the US dollar results in Sibanye-Stillwater's revenues and operating margin increasing. Conversely, should the rand appreciate against the US dollar, revenues and operating margins would decrease. The impact on profitability of any change in the exchange rate can be substantial. Furthermore, the exchange rates obtained when converting US dollars to rand are set by foreign exchange markets over which Sibanye-Stillwater has no control. The relationship between currencies and commodities, which includes the gold price, is complex and changes in exchange rates can influence commodity prices and vice versa.

In the ordinary course of business, the Group enters into transactions, such as gold sales and PGM sales, denominated in foreign currencies, primarily US dollar. Although this exposes the Group to transaction and translation exposure from fluctuations in foreign currency exchange rates, the Group does not generally hedge this exposure, although it could be considered for significant expenditures based in foreign currency or those items which have long lead times to produce or deliver. Also, the Group on occasion undertakes currency hedging to take advantage of favourable short-term fluctuations in exchange rates when management believes exchange rates are at unsustainably high levels.

Currency risk also exists on account of financial instruments being denominated in a currency that is not the functional currency and being of a monetary nature. This includes but is not limited to US$600 million RCF (refer note 26.1), US$ Convertible Bond (refer note 26.5), Burnstone Debt (refer note 26.7) and Franco-Nevada liability.

For additional disclosures, refer notes 3 and 26.

Foreign currency economic hedging experience

During 2019 a small number of intra month (i.e. up to 21 days) forward exchange rate contracts were executed to hedge a known currency inflow. During 2018 no forward exchange rate contracts were concluded. During May 2017, the Group entered into a forward exchange contract to acquire US$779.1 million at R13.23/US$ on 15 June 2017 with the proceeds of the rights offer (refer to note 22) to partially repay the Stillwater Bridge facility (refer to note 24.8). The exchange rate on 15 June 2017 was R12.89/US$ and the Group recognised a loss on financial instruments of R283.2 million.

As at 31 December 2019, 31 December 2017 and the date of this report Sibanye-Stillwater had no outstanding foreign currency contract positions. As at 31 December 2018, Sibanye-Stillwater had a foreign currency contract position of US$12.1 million at a weighted average rate of R14.11/US$ .

Commodity price risk

The market price of commodities has a significant effect on the results of operations of the Group and the ability of the Group to pay dividends and undertake capital expenditures. The gold and PGM basket prices have historically fluctuated widely and are affected by numerous industry factors over which the Group does not have any control. The aggregate effect of these factors on the gold and PGM basket prices, all of which are beyond the control of the Group, is impossible for the Group to predict.

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FOR THE YEAR ENDED 31 DECEMBER 2019

Commodity price hedging policy

As a general rule, the Group does not enter into forward sales, derivatives or other hedging arrangements to establish a price in advance for future gold and PGM production. Commodity hedging could, however, be considered in future under one or more of the following circumstances: to protect cash flows at times of significant capital expenditure; financing projects or to safeguard the viability of higher cost operations.

To the extent that it enters into commodity hedging arrangements, the Group seeks to use different counterparty banks consisting of local and international banks to spread risk. None of the counterparties is affiliated with, or related to parties of the Group.

Commodity price hedging experience

At 31 December 2019, Sibanye-Stillwater had the following gold commodity price hedges outstanding:

• a total of 88,415oz at an average floor price of R19,222/oz (R618,001/kg) and capped price of R21,218/oz (R682,174/kg).

Commodity price contract position

As of 31 December 2019, 2018 and 2017, Sibanye-Stillwater had no outstanding commodity forward sale contracts for mined production.

Interest rate risk

The Group's income and operating cash flows are dependent of changes in market interest rates. The Group's interest rate risk arises from long-term borrowings.

For additional disclosures, refer to note 26.8.

35. Commitments

Figures in million - SA rand	2019	2018	2017
Capital expenditure	5,972.3	4,411.7	5,397.3
Authorised
Kloof	1,289.8	970.2	1,200.8
Driefontein	846.1	830.9	724.5
Beatrix	231.7	218.0	210.1
SGL corporate	762.4	-	-
Cooke	55.1	195.5	195.5
Burnstone	5.4	40.4	445.9
Kroondal	220.3	131.6	69.8
Platinum Mile	19.9	72.3	72.3
Rustenburg operation	2,033.1	1,830.0	2,478.3
Marikana	153.4	-	-
Other	355.1	122.8	0.1
Contracted for	594.5	281.8	346.6
Other guarantees	1,420.5	266.7	266.7

Commitments will be funded from internal sources and to the extent necessary from borrowings. This expenditure primarily relates to hostel upgrades, mining activities and infrastructure.

36. Contingent liabilities

Significant accounting judgements and estimates

Contingencies can be either possible assets or possible liabilities arising from past events which, by their nature, will only be resolved when one or more future events not wholly within the control of the Group occur or fail to occur or for contingent liabilities where a present obligation arising from a past event exists but is not recognised because either it is not probable that an out-flow of resources embodying economic benefits will be required to settle the obligation or the amount of the obligation cannot be determined with sufficient reliability. The assessment of such contingencies inherently involves the exercise of significant judgement and estimates of the outcome of future events.

Purported Class Action Lawsuits

In 2018, two groups of plaintiffs filed purported class action lawsuits, subsequently consolidated into a single action (Class Action), against Sibanye Gold Limited (Sibanye-Stillwater) and Neal Froneman (collectively, the Defendants) in the United States District Court for the Eastern District of New York, alleging violations of the US securities laws. Specifically, the Class Action alleges that the Defendants made false and/or misleading statements about its safety practices and record and thereby violated the US securities laws. The Class Action seeks an unspecific amount of damages. The Defendants have filed a motion to dismiss the Class Action. The Court may decide the motion to dismiss with or without oral argument. As the case is still in the early stages, it is not possible to determine the likelihood of

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FOR THE YEAR ENDED 31 DECEMBER 2019

success on the merits or any potential liability from the Class Action nor estimate the duration of the litigation. Sibanye-Stillwater intends to defend the case vigorously.

Delaware Court of Chancery rules in favour of Sibanye-Stillwater in dissenting shareholder action

The Court of Chancery of the State of Delaware in the United States of America (the Court), in a Memorandum Opinion dated 21 August 2019, has ruled in favour of the Company in the appraisal action brought by a group of minority shareholders (the Dissenting Shareholders) of the Stillwater Mining Company (Stillwater), following the acquisition of Stillwater by the Company in May 2017 for a cash consideration of US$18 per Stillwater share.

In terms of the ruling, the Dissenting Shareholders (together owning approximately 4.5% of Stillwater shares outstanding at the time) received the same US$18 per share consideration originally offered to, and accepted by other Stillwater shareholders, plus interest. The remaining payment of approximately US$21 million due to the Dissenting Shareholders has been paid by Sibanye-Stillwater during the six months ended 31 December 2019.

Certain of the Dissenting Shareholders have filed an appeal with the Supreme Court of the State of Delaware with the date for the oral argument, originally set for 1 April 2020, postponed in light of COVID-19 until a future date is set by the Court. The Company will continue to defend itself against opportunistic, short-term and self-interested legal action, to protect the interests of our stakeholders.

37. Related-party transactions

Sibanye-Stillwater entered into related-party transactions with Rand Refinery, and its subsidiaries during the year as detailed below. The transactions with these related parties are generally conducted with terms comparable to transactions with third parties, however in certain circumstances such as related-party loans, the transactions were not at arm's length.

Refer to note 1.3 for the Group structure which provides further detail on the relationship between parent and subsidiary companies.

Rand Refinery

Rand Refinery, in which Sibanye-Stillwater holds a 44.4% interest, has an agreement with the Group whereby it refines all the Group's gold production. No dividends were received during the years ended 31 December 2019, 2018 and 2017. For the year ended

31 December 2019, the group sold gold and paid refining fees to Rand Refinery.

The table below details the transactions and balances between the Group and its related-parties:

Figures in million - SA rand	Note	2019	2018	2017
Rand Refinery		505.5
Gold sales		616.2	-
Refining fees paid		(24.8)	(29.1)	(32.5)
Interest income	16.1	-	-	1.5
Trade payable		(4.5)	(3.1)	(4.0)

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Key management remuneration

The executive directors and prescribed officers were paid the following remuneration during the year:

			Accrual of
		Cash	Bonus
		bonus	Share		Expense
		accrued	awards and
		for 2018 Performance	Pension allowance
		paid in	Share	scheme total	and other
Figures in thousands - SA rand	Salary	2019	proceeds contributions	benefits	2019	2018
Executive directors						31,917
Neal Froneman1	12,521	10,482	6,989	912	1,013	35,760
Charl Keyter	6,295	4,994	3,329	899	507	16,024	17,697
Prescribed officers						25,289
Chris Bateman2	8,919	4,481	2,988	318	8,583	16,885
Shadwick Bessit	4,186	3,252	2,168	739	250	10,595	688
Hartley Dikgale	3,721	2,235	1,490	260	192	7,898	8,761
Dawie Mostert	3,833	2,808	1,872	523	248	9,284	10,112
Themba Nkosi	3,797	2,424	1,616	280	-	8,117	7,265
Wayne Robinson	4,511	2,940	1,960	366	267	10,044	10,925
Richard Stewart	3,947	2,828	1,885	438	330	9,428	12,986
Robert van Niekerk	5,083	4,567	3,045	565	287	13,547	13,508
Total	56,813	41,011	27,342	5,300	11,677	142,143	134,587

1. Entered into a dual service contract with effect 1 May 2018. Remuneration paid in US dollars was converted at the average exchange rate of R14.46/US$ for the year ended 31 December 2019
2. Remuneration paid in US dollars was converted at the average exchange rate of R14.46/US$ for the year ended 31 December 2019. The other (cash) benefit represents the contracted payout of benefits arising from the treatment of unvested share-based remuneration in respect of the Stillwater Mining Company share plan, which comprised shares granted in the form of time-based restricted stock unit awards and performance-based restricted stock unit awards. In accordance with the change of control provisions of the Stillwater Mining Company share plan, on the acquisition of Stillwater Mining Company by Sibanye-Stillwater all shares (i.e. time-based restricted stock unit awards and performance-based restricted stock unit awards) were converted to a cash settlement at US$18/share with phased payments. No further performance criteria were to be applied with settlement subject to the prescribed officer remaining in the employment of Sibanye-Stillwater at 31 December to qualify for the payment. The final tranche was payable at 31 December 2019

The non-executive directors were paid the following fees during the year:

	Directors Committee	Expense
Figures in thousands - SA rand	fees	fees	allowance	2019	2018
Tim Cumming	998	692	105	1,795	1,698
Savannah Danson	998	611	-	1,609	1,480
Barry Davison1	404	262	-	666	1,649
Harry Kenyon-Slaney2	1,103	596	-	1,699	-
Rick Menell	998	833	-	1,831	1,723
Sello Moloko	1,407	-	-	1,407	1,802
Nkosemntu Nika	998	611	-	1,609	1,435
Keith Rayner	998	784	99	1,881	1,723
Sue van der Merwe	998	611	-	1,609	1,491
Jerry Vilakazi	998	364	-	1,362	1,289
Vincent Maphai3	340	482	-	822	-
Total	10,240	5,846	204	16,290	14,290

1. Resigned as a non-executive director on 28 May 2019
2. Appointed as a non-executive director on 16 January 2019
3. Appointed as a non-executive chairman of the board on 1 June 2019

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

The directors' and prescribed officers' share ownership at 31 December 2019 was1:

	Number of shares	%
	2019	2018	2019		2018
Executive directors	4,858,723		0.18
Neal Froneman3	4,555,954		0.20
Charl Keyter3	1,673,316	1,530,119	0.06		0.07
Non-executive directors			-
Tim Cumming2	242	106	-		-
Barry Davison4	-	1,567,710	-		0.07
Rick Menell2	108,625	108,625	-		-
Sello Moloko4	-	111,534	-		-
Keith Rayner2	68,992	68,992	-		-
Sue van der Merwe2	1,028	1,028	-		-
Total share ownership by directors	6,710,926	7,944,068
Prescribed officers	32,747		-
Chris Bateman3	32,747		-
Shadwick Bessit3	31,652	219,782	-		0.01
Hartley Dikgale3	184,311	114,744	0.01		0.01
Dawie Mostert3	38,975	50,743	-		-
Themba Nkosi3	796	19,107	-		-
Wayne Robinson3	73,292	39,321	-		-
Richard Stewart3	362,747	421,653	0.01		0.02
Robert van Niekerk3	257,732	271,537	0.01		0.01
Total	7,693,178	9,113,702

1. Following the scheme of arrangement between Sibanye Gold Limited and Sibanye Stillwater Limited, effective 24 February 2020, the Directors' shareholdings are in Sibanye Stillwater Limited. On the effective date of the scheme of arrangement, Sibanye Stillwater Limited owns 100% of the issued share capital of Sibanye Gold Limited
2. Share ownership in Sibanye Stillwater Limited1 at the date of this report is unchanged
3. Share ownership in Sibanye Stillwater Limited1 at the date of this report was:
4. • Neal Froneman - 5,167,082 shares
   • Charl Keyter - 1,846,767 shares
   • Chris Bateman - 130,988 shares
   • Shadwick Bessit - 124,707 shares
   • Hartley Dikgale - 283,079 shares
   • Dawie Mostert - 27,118 shares
   • Themba Nkosi - 89,290 shares
   • Wayne Robinson - 184,333 shares
   • Richard Stewart - 495,303 shares
   • Robert van Niekerk - 501,057 shares
5. Resigned during 2019

None of the directors' immediate families or associates held any direct shareholding in Sibanye-Stillwater's issued share capital.

38. Events after reporting date

There were no events that could have a material impact on the financial results of the Group after 31 December 2019, other than those disclosed below.

38.1 Sibanye Gold Limited scheme of arrangement

On 4 October 2019 Sibanye Gold Limited (trading as Sibanye-Stillwater) and Sibanye Stillwater Limited announced the intention to implement a scheme of arrangement to reorganise Sibanye Gold Limited's operations under a new parent company, Sibanye Stillwater Limited (the "Scheme"). Under the Scheme, Sibanye Stillwater Limited acquired Sibanye Gold Limited and its controlled entities.

On 23 January 2020 Sibanye Gold Limited and Sibanye Stillwater Limited announced that all resolutions for the approval of the Scheme, were passed by the requisite majority voters at the Scheme meeting held at the Sibanye Gold Limited Academy.

Sibanye Stillwater Limited determined that the acquisition of Sibanye Gold Limited did not represent a business combination as defined by IFRS 3 Business Combinations. This is because neither party to the Scheme could be identified as an accounting acquirer in the transaction, and post the implementation there would be no change of economic substance or ownership in the Sibanye Gold Limited Group. The Sibanye Gold Limited shareholders have the same commercial and economic interest as they had prior to the implementation of the Scheme and no additional new ordinary shares of Sibanye Gold Limited were issued as part of the Scheme. The consolidated financial statements of Sibanye Stillwater Limited therefore will reflect that the arrangement is in substance a continuation of the existing Sibanye Gold Limited Group. Sibanye Gold Limited is the predecessor of Sibanye Stillwater Limited for financial reporting purposes and for future consolidated financial reporting periods, Sibanye Stillwater Limited's consolidated comparative information will be presented as if the reorganisation had occurred before the start of the earliest period presented.

The Scheme was implemented on 24 February 2020.

Sibanye-Stillwater Annual Financial Report 2019

120

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

1. DRDGOLD increase in shareholding
   On 10 January 2020, Sibanye-Stillwater announced that it has exercised its option to subscribe for 168,158,944 additional ordinary shares of DRDGOLD Limited ("DRDGOLD") to attain a 50.1% shareholding in DRDGOLD. The option was exercised on 8 January 2020 in terms of the DRDGOLD option agreement between Sibanye-Stillwater and DRDGOLD, entered into on 22 November 2017 and accounted for as a transaction between shareholders. The subscription price for each Option Share was R6.46 per share, payable in cash, representing a 22.69% discount to the closing price of R8.35 per DRDGOLD share and a 10% discount to the 30-day volume weighted average traded price.
2. Section 189A consultations
   On 16 January 2020, Sibanye-Stillwater advised that the consultation process with relevant stakeholders in terms of Section 189A (S189) of the Labour Relations Act, 66 of 1995 (LRA), regarding the proposed restructuring of its Marikana operation and associated services (previously Lonmin), has been concluded.
3. Palladium and Gold hedge agreements
   On 17 January 2020, Stillwater Mining Company Limited (wholly owned subsidiary of Sibanye-Stillwater) concluded a palladium hedge agreement commencing on 28 February 2020, comprising the delivery of 240,000 ounces of palladium over two years (10,000 ounces per month) with a zero cost collar which establishes a minimum floor and a maximum cap of US$1,500 and US$3,400 per ounce, respectively.
   On 9 March 2020, Sibanye-Stillwater concluded a gold hedge agreement commencing on 1 April 2020, comprising the delivery of 1,800 Kg of gold (150kg per month) with a zero cost collar which establishes a minimum floor and a maximum cap of R800,000 and R1,080,000 per kilogram, respectively.
4. BTT release agreement
   On 24 January 2020, Western Platinum Proprietary Limited, Eastern Platinum Limited and Lonmin Limited (collectively the "Purchasers"), subsidiaries of Sibanye-Stillwater, entered into a Release and Cancellation Agreement ("the Release Agreement") with RFW Lonmin Investments Limited ("the Seller"). The Release Agreement sets out the terms and conditions upon which the Purchasers have purchased the Seller's entire interest in the Metals Purchase Agreement ("MPA") for an amount of US$50 million to be settled in cash ("the Early Settlement").
   On 4 March 2020, it was announced that Sibanye-Stillwater advises that Western Platinum Proprietary Limited ("WPL"), Eastern Platinum Limited ("EPL") and Lonmin Limited (UK) ("Lonmin"), have entered into a Release and Cancellation Agreement with RFW Lonmin Investments Limited regarding the early settlement, of a prior streaming agreement, on more favourable terms.
   The transaction was implemented on 6 March 2020 at which date the liability was settled.
5. South Africa: Escalated measures to combat COVID-19 pandemic
   On 23 March 2020, the President of the Republic of South Africa announced that the National Coronavirus Command Council has decided to enforce a nation-wide lockdown for 21 days with effect from midnight on 26 March 2020 following the outbreak of COVID-19 in South Africa. The lockdown required companies in South Africa like ours, whose operations are continuous, to institute care and maintenance protocols to avoid damage to our infrastructure and assets. During the initial lockdown period, there was no production from our SA Gold and SA PGM operations. In response to the COVID-19 pandemic and restrictions implemented in the USA, our US PGM operations have decreased the use of contractors, which affected the timing of capital projects and had a limited impact on normal production. On 9 April 2020 the South African President announced that the lockdown period is extended for an additional 14 days and on 16 April 2020 a notice was published by the South African government which amended certain regulations previously issued in terms of Section 27(2) of the Disaster Management Act, 2002. These amendments, amongst others, allowed for South African mining operations to be conducted at a reduced capacity of not more than 50% during the period of lockdown, and thereafter at increasing capacity as determined by directives to be issued by the Minister of Mineral Resources and Energy.
   Refer to note 34.2 for further information regarding the impact of the COVID-19 pandemic on the operations and liquidity of the Group.
6. Anglo American Platinum Limited Force Majeure
   On 6 March 2020, Anglo American Platinum Limited (Anglo Platinum) announced the temporary closure of a converter plant at its Rustenburg Platinum Mines (RPM) processing facilities that lead to Anglo Platinum declaring a Force Majeure (FM) for a period of approximately 80 days. The FM affects the toll agreement between Anglo Platinum and our Rustenburg operation, and the purchase of concentrate (PoC) agreement with our Kroondal and Platinum Mile operations. Following an assessment of spare PGM processing capacity at the Marikana operations and at the precious metal refinery at Brakpan (Marikana processing facilities), the agreements reached between Sibanye-Stillwater and Anglo Platinum at the different operations could be summarised as follows:
7. • Rustenburg operations - PGM concentrate from the Rustenburg operations will continue to be smelted by Anglo Platinum on the same terms as the existing toll arrangement for the smelter portion, but thereafter, the resultant matte will be further processed and refined at the Marikana processing facilities;
   • Platinum Mile operations - PGM concentrate will be sold to and processed by the Marikana processing facilities for the duration of the FM period under the same terms as the pre-existing PoC agreement with Anglo Platinum. All benefits of the PoC agreement will accrue to Marikana; and
   • Kroondal operations - Currently operate under a Pool and Share Agreement (PSA) with Anglo Platinum with 50% of the profits attributable to Sibanye-Stillwater shareholders and 50% of the profits attributable to Anglo Platinum shareholders. For the duration of the FM period, 50% of the concentrate produced from the Kroondal PSA attributable to both parties will now be sold to and processed

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121

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued

FOR THE YEAR ENDED 31 DECEMBER 2019

by the Marikana processing facilities under the same terms as the pre-existing PoC agreement with Anglo Platinum. All benefits of the PoC agreement for the 50% concentrate treated by the Marikana processing facilities will accrue to Marikana. The remaining 50% of the concentrate produced from the Kroondal PSA will continue to be sold to Anglo Platinum on materially the same terms and conditions as the pre-existing PoC agreement (delays in payment terms have been agreed).

Furthermore, concentrate in respect of Platinum Mile and the Kroondal PSA delivered up to 9 March 2020 was sold to RPM in accordance with the pre-existing PoC agreements.

These agreements will largely offset the smelting and refining impact of the FM event on the Sibanye-Stillwater operations, but will result in delayed cash flows.

Sibanye-Stillwater Annual Financial Report 2019

122

SHAREHOLDER INFORMATION

Registered shareholder spread at 31 December 2019

		Number of		% of total		Number of		% of issued
		holders		shareholders1		shares2		capital1,3
1-1,000 shares		17,655	74.37	2,628,244	0.10
1,001-10,000 shares	4,010	16.89	13,687,268	0.51
10,001 - 100,000 shares	1,268	5.34	42,598,486	1.60
100,001-1,000,000 shares	605	2.55	193,426,830	7.24
1,000,001 shares and above	203	0.86	2,417,688,424	90.55
Total	23,741	100.00	2,670,029,252	100.00

1. Figures may not add due to rounding.
2. As of 27 March 2020, the issued share capital of Sibanye-Stillwater consisted of 2,675,009,792 ordinary shares.
3. To our knowledge: (1) Sibanye-Stillwater is not directly or indirectly owned or controlled (a) by another entity or (b) by any foreign government; and (2) there are no arrangements the operation of which may at a subsequent date result in a change in control of Sibanye-Stillwater. To the knowledge of Sibanye-Stillwater's management, there is no controlling shareholder of Sibanye-Stillwater.

Public and non-public shareholdings at 31 December 2019
	Number of	% of total	Number of	% of issued
	holders	shareholders1	shares	capital1
Non-public shareholders	10	0.04	29,174,174	1.09
Directors	8	0.03	8,390,170	0.31
Share trust	1	0.01	19,233,755	0.72
Own holding	1	0.01	1,550,249	0.06
Public shareholders	23,731	99.96	2,640,855,078	98.91

Total

23,741

100.00 2,670,029,252

100.00

1 Figures may not add due to rounding.

Foreign custodians above 3% at 31 December 2019

		Number of
		shares	%
Bank of New York Depositary Receipts		669,367,954	25.07
J.P. Morgan Chase Bank	143,397,307	5.37
State Street Bank and Trust Company	139,984,654	5.24

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123

SHAREHOLDER INFORMATION continued

Beneficial shareholder categories at 31 December 2019

	Number of	% of total		Number of		% of issued
	holders	shareholders2		shares1		capital1
Other managed funds	22,115	93.15		156,711,005	5.87
Unit trusts/ Mutual funds	472	1.99	703,739,023	26.36
Private investor	404	1.70	77,461,266	2.90
Pension funds	357	1.50	462,721,756	17.33
Custodians	103	0.43	60,752,139	2.28
American depository receipts	78	0.33	657,826,498	24.64
Insurance companies	42	0.18	51,300,508	1.92
Trading position	41	0.17	74,686,457	2.80
Exchange-Traded Fund	36	0.15	23,010,769	0.86
Sovereign wealth	21	0.09	117,188,250	4.39
Hedge fund	14	0.06	17,153,852	0.64
University	12	0.05	3,291,537	0.12
Medical aid scheme	12	0.05	2,998,238	0.11
Charity	11	0.05	3,335,629	0.12
Stock brokers	7	0.03	4,895,344	0.18
Local authority	6	0.03	4,805,768	0.18
Corporate holding	4	0.02	450,519,336	16.87
Foreign government	2	0.01	456,947	0.02
Black economic empowerment	1	0.00	6,307,069	0.24
Employees	1	0.00	95,623	0.00
Private equity	1	0.00	59,102	0.00
Investment Trust	1	0.00	52,000	0.00
Total	23,741	100.00	2,879,368,116	107.83

1. Shareholder totals within beneficial shareholder categories equates to more than the issued shares 2,670,029,252 and 100% of issued share capital as it incorporates stock on loan from institutional investors
2. Figures may not add due to rounding

The tables below show the change in the percentage ownership of Sibanye-Stillwater's major shareholders, to the knowledge of Sibanye- Stillwater's management, between 2017 and 2019.

Investment management shareholdings more than 3% at 31 December1

	2019		2018		2017
	Number of			Number of		Number of
				shares	%	shares	%
	shares		%
Public Investment Corporation (SOC) Limited	244,814,334		9.17	223,673,695	9.87	190,930,628	8.80
Exor Investments	176,159,937		6.60	184,601,372	8.15	95,906,000	4.42
Investec Asset Management	158,890,234		5.95	113,304,131	5.00	145,619,201	6.71
Van Eck Associates Corporation	108,566,024		4.07	112,809,448	4.98	232,647,340	10.73
BlackRock Inc	95,256,378		3.57	37,035,123	1.63	92,159,514	4.25
Hosking Partners LLP	54,334,816		2.03	86,245,293	3.81	47,388,289	2.19
Dimensional Fund Advisors	74,726,010		2.80	71,657,654	3.16	60,314,329	2.78
The Vanguard Group Inc	85,933,956		3.22	61,276,405	2.70	64,079,278	2.95

1 A list of the investment managers holding, to the knowledge of Sibanye-Stillwater's management, directly or indirectly, 3% or more of the issued share capital of Sibanye-Stillwater as of 27 March 2020 is set forth below:

	Number of
	shares	%
Public Investment Corporation (SOC) Limited	285,197,399	10.68
BlackRock Inc	135,355,495	5.07
Van Eck Associates Corporation	134,285,490	5.03
Ninety One Plc	132,133,244	4.95
Exor Investments	109,603,584	4.10
The Vanguard Group Inc	86,718,574	3.25

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SHAREHOLDER INFORMATION continued

Beneficial shareholdings more than 3% at 31 December1

	2019		2018		2017
	Number of		%		Number of	%	Number of	%
				shares	shares
	shares
Gold One International Limited	448,891,942		16.81		454,608,714	20.06	427,945,215	19.73
Government Employees Pension Fund (PIC)	270,816,493		10.14		230,531,383	10.17	220,118,742	10.15

1 A list of the individuals and organisations holding, to the knowledge of Sibanye-Stillwater's management, directly or indirectly, 3% or more of the issued share capital of Sibanye-Stillwater as of 27 March 2020 is set forth below:

	Number of
	shares	%
Gold One	327,449,422	12.26
Government Employees Pension Fund (PIC)	339,232,137	12.71

Sibanye-Stillwater's ordinary shares are subject to dilution as a result of any non-pre-emptive share issuance, including upon the exercise of Sibanye-Stillwater's outstanding share options, issues of shares by the Board in compliance with BEE legislation or in connection with acquisitions.

The principal non-United States trading market for the ordinary shares of Sibanye-Stillwater is the JSE Limited, on which they trade under the symbol "SGL". Sibanye-Stillwater's American depositary shares (ADSs) trade in the United States on the NYSE under the symbol "SBGL". The ADRs representing the ADSs were issued by the Bank of New York Mellon (BNYM) as Depositary. Each ADS represents four ordinary shares.

No public takeover offers by third parties have been made in respect of Sibanye-Stillwater's shares or by Sibanye-Stillwater in respect of other companies' shares during the last and current fiscal year.

Sibanye-Stillwater Annual Financial Report 2019

125

ADMINISTRATIVE AND CORPORATE INFORMATION

SIBANYE STILLWATER LIMITED (SIBANYE-STILLWATER)

Incorporated in the Republic of South Africa

Registration number 2014/243852/06 Share code: SSW

Issuer code: SSW

ISIN: ZAE000259701

LISTINGS

JSE: SSW

NYSE: SBSW

WEBSITE

www.sibanyestillwater.com

REGISTERED AND

CORPORATE OFFICE

Constantia Office Park

Cnr 14th Avenue & Hendrik Potgieter Road Bridgeview House

Ground floor Weltevreden Park 1709 South Africa

Private Bag X5

Westonaria 1780

South Africa

Tel: [phone]

Fax: [phone]

COMPANY SECRETARY

Lerato Matlosa

Tel: [phone] Email: [e-mail]

DIRECTORS

Dr Vincent Maphai* (Chairman)

Rick Menell* (lead independent director) Neal Froneman (CEO)

Charl Keyter (CFO)

Timothy Cumming*

Savannah Danson*

Dr Elaine Dorward-King* Harry Kenyon-Slaney* Nkosemntu Nika* Keith Rayner*

Susan van der Merwe* Jerry Vilakazi*

* Independent non-executive

INVESTOR ENQUIRIES

James Wellsted

Senior Vice President: Investor Relations

Cell: [phone]

Tel: [phone] Email: [e-mail] or [e-mail]

JSE SPONSOR

JP Morgan Equities South Africa Proprietary Limited

Registration number 1995/011815/07 1 Fricker Road

Illovo Johannesburg 2196 South Africa

Private Bag X9936 Sandton 2196 South Africa

AUDITORS

Ernst & Young Inc (EY)

102 Rivonia Road

Sandton

Private Bag X14

Sandton 2146

South Africa

Tel: [phone]

AMERICAN DEPOSITARY RECEIPTS TRANSFER AGENT

BNY Mellon Shareowner Services

PO Box 358516

Pittsburgh

PA 15252-8516

US toll free: [phone]

Tel: [phone] Email: [e-mail]

Tatyana Vesselovskaya

Relationship Manager

BNY Mellon

Depositary Receipts

Direct line: [phone]

Mobile: [phone]

Fax: [phone] Email: [e-mail]

TRANSFER SECRETARIES SOUTH AFRICA

Computershare Investor Services Proprietary Limited

Rosebank Towers

15 Biermann Avenue

Rosebank 2196

PO Box 61051

Marshalltown 2107

South Africa

Tel: [phone]

Fax: [phone]

Sibanye-Stillwater Annual Financial Report 2019

126

ANCILLARY INFORMATION

DELIVERING ON OUR STRATEGY AND OUTLOOK

LEADERSHIP

WHAT DRIVES US

SETTING THE SCENE

com.sibanyestillwater.www