Exxaro Resources Limited - Notes to the reviewed condensed group interim financial statements

Exxaro, a public company incorporated in South Africa, is a diversified resources group with interests in the coal (controlled and non-controlled), energy (controlled) and ferrous (controlled and non-controlled) markets. These reviewed condensed group interim financial statements as at and for the
six-month period ended 30 June 2024 (interim financial statements) comprise the company and its subsidiaries (together referred to as the group) and the group’s interest in associates and joint ventures.

2.1 Statement of compliance

The interim financial statements have been prepared in accordance with and contain the information required by the JSE Listings Requirements and the requirements of the Companies Act of South Africa. The JSE Listings Requirements require interim financial statements to be prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS® Accounting Standards) (as issued by the International Accounting Standards Board (IASB®)), in accordance with and containing the information required by IAS 34 Interim Financial Reporting, Financial Pronouncements (as issued by the Financial Reporting Standards Council), and the SAICA Financial Reporting Guides (as issued by the Accounting Practices Committee).

The interim financial statements have been prepared under the supervision of Mr PA Koppeschaar CA(SA), SAICA registration number: 00038621.

The interim financial statements should be read in conjunction with the group annual financial statements as at and for the year ended 31 December 2023, which have been prepared in accordance with IFRS Accounting Standards. The interim financial statements have been prepared on the historical cost basis, except for financial instruments, share-based payments and biological assets, which are measured at fair value.

The interim financial statements were authorised for issue by the board of directors on 13 August 2024.

2.2 Judgements and estimates

Management made judgements and applied estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. The significant judgements and the key source of estimation uncertainty were similar to those applied to the group annual financial statements as at and for the year ended 31 December 2023.

The accounting policies applied are in terms of IFRS Accounting Standards and are consistent with those of the previous financial year. The policy for recognising and measuring income taxes in the interim reporting period is consistent with that applied in the previous interim reporting period as described in 3.1 below. A number of new or amended IFRS Accounting Standards became effective for the current reporting period. The group did not have to make any significant changes to its accounting policies nor make retrospective adjustments as a result of adopting these standards.

3.1 Income tax

Income tax expense is recognised based on management’s estimate of the weighted average effective annual tax rate expected for the full financial year. The estimated weighted average effective annual tax rate used for the six-month period ended 30 June 2024 is 19%, compared to 19.60% for the
six-month period ended 30 June 2023.

The main reconciling items, between the current standard tax rate of 27% and the effective tax rate, result from the share of income of equity-accounted investments and dividend income (-8.7%).

3.2 Impact of new, amended or revised standards issued but not yet effective

New IFRS Accounting Standards, amendments to accounting standards and interpretations issued, that are relevant to the group, but not yet effective on 30 June 2024, have not been early adopted. The group continuously evaluates the impact of these standards and amendments.


	Gross Rm	Tax Rm	NCI Rm	Net Rm
6 months ended 30 June 2024 (Reviewed)
Profit attributable to owners of the parent				3 686
Adjusted for:	21	(6)	(4)	11
– IAS 16 Net losses on disposal of property, plant and equipment	9	(3)	(2)	4
– IAS 28 Share of equity-accounted investments’ separately identifiable remeasurements	1			1
– IAS 38 Losses on disposal of intangible assets	11	(3)	(2)	6

Headline earnings				3 697
6 months ended 30 June 2023 (Reviewed)
Profit attributable to owners of the parent				5 905
Adjusted for:	13	(4)	(2)	7
– IAS 16 Net losses on disposal of property, plant and equipment	11	(3)	(2)	6
– IAS 28 Share of equity-accounted investments’ separately identifiable remeasurements	2	(1)		1

Headline earnings				5 912
12 months ended 31 December 2023 (Audited)
Profit attributable to owners of the parent				11 292
Adjusted for:	61	(15)	(11)	35
– IAS 16 Net losses on disposal of property, plant and equipment	57	(15)	(10)	32
– IAS 28 Share of equity-accounted investments’ separately identifiable remeasurements	4		(1)	3

Headline earnings				11 327


	6 months ended 30 June 2024 Reviewed cents	6 months ended 30 June 2023 Reviewed cents	12 months ended 31 December 2023 Audited cents
Headline earnings per share
– Basic	1 528	2 443	4 681
– Diluted	1 528	2 443	4 681

Refer note 6 for details regarding the number of shares.

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker, who is responsible for allocating resources and assessing performance of the reportable operating segments. The chief operating decision maker has been defined as the executive committees of the group. Segments reported are based on the group’s different commodities and operations.

In line with reporting trends, emphasis is placed on controllable costs. Indirect corporate costs are reported on a gross level in the other reportable segment. The performance of the operating segments is assessed based on EBITDA, which is considered to be a more appropriate performance measure of profitability for the group’s business (refer note 26.1).

The segments, as described below, offer different goods and services, and are managed separately based on commodity, location and support function grouping. The group executive committees review internal management reports on these operating segments at least quarterly.

Coal

The coal operations produce thermal coal, metallurgical coal and SSCC and are made up of the following reportable segments:

Commercial Waterberg: Comprising mainly of the Grootegeluk operation.

Commercial Mpumalanga: Comprising of the Belfast and Leeuwpan operations, as well as the 50% (30 June 2023: 50%; 31 December 2023: 50%) joint venture in Mafube with Thungela.

Tied: Comprising of the Matla mine supplying its entire coal supply to Eskom.

Other: Comprising of the other coal affiliated operations, including mines in closure and a 10.26% (30 June 2023: 10.26%; 31 December 2023: 10.26%) equity interest in RBCT.

The export revenue and related export cost items are allocated between the coal reportable segments and disclosed based on the origin of the initial coal production.

Energy

The energy operations generate electricity from renewable energy technology. The energy reportable segment comprises mainly of the Cennergi controlled operations and LSP which is in the construction phase.

Ferrous

The ferrous operations are made up of the following reportable segments:

Alloys: Comprising of the FerroAlloys operation which manufactures ferrosilicon.

Other: Comprising mainly of the 20.62% (30 June 2023: 20.62%; 31 December 2023: 20.62%) equity interest in SIOC.

Other

The other operations of the group are made up of the following reportable segments:

Base metals: Comprising of the 26% (30 June 2023: 26%; 31 December 2023: 26%) equity interest in Black Mountain.

Other: Comprising mainly of the corporate office (rendering corporate management services) and the Ferroland agricultural operation.

The following tables present a summary of the group’s segmental information:


	Coal
6 months ended 30 June 2024 (Reviewed)	Commercial
6 months ended 30 June 2024 (Reviewed)	Water- berg Rm	Mpuma- langa Rm	Tied Rm	Other Rm	Energy Rm
External revenue (note 7)	10 657	4 636	2 958		652
Segmental net operating profit/(loss)	4 321	(344)	93	(152)	274
Add back:
Depreciation and amortisation (note 8)	824	301		8	196
Net losses on disposal of property, plant and equipment (note 8)	5	4
Losses on disposal of intangible assets (note 8)
EBITDA (note 26.1)	5 150	(39)	93	(144)	470
Other key items:
Raw materials and consumables (note 8)	(1 066)	(1 369)	(264)	(2)
Staff costs (note 8)	(1 391)	(212)	(1 027)	(216)	(44)
Royalties (note 8)1	(553)	(30)	(26)	76
Contract mining (note 8)	(40)	(923)
Repairs and maintenance (note 8)	(990)	(165)	(449)		(6)
Railage and transport (note 8)	(811)	(1 433)
Movement in provisions (note 8)	101	(127)	12	13
External finance income (note 10)	10	19		17	30
External finance costs (note 10)	(26)	(61)		(60)	(253)
Share of income/(loss) of equity-accounted investments (note 11)		60		3
Income tax (expense)/benefit	(1 113)	105	(24)		(31)
Cash generated by/(utilised in) operations (note 9)	4 828	146	124	(588)	453
Capital spend on property, plant and equipment (note 12)	(968)	(76)			(6)
At 30 June 2024 (Reviewed)
Segmental assets and liabilities
Deferred tax2					15
Equity-accounted investments (note 13)		1 977		2 017
External assets	31 936	5 918	1 484	2 470	9 089
Total assets	31 936	7 895	1 484	4 487	9 104
External liabilities	2 034	2 488	1 356	1 227	5 371
Deferred tax2	7 451	759	(63)	2	914
Total liabilities	9 485	3 247	1 293	1 229	6 285

1 Calculated per legal entity.

2 Offset per legal entity and tax authority.


	Ferrous		Other
6 months ended 30 June 2024 (Reviewed)	Alloys Rm	Other ferrous Rm	Base metals Rm	Other Rm	Total Rm
External revenue (note 7)	75			3	18 981
Segmental net operating profit/(loss)	(14)			(484)	3 694
Add back:
Depreciation and amortisation (note 8)	2			73	1 404
Net losses on disposal of property, plant and equipment (note 8)					9
Losses on disposal of intangible assets (note 8)				11	11
EBITDA (note 26.1)	(12)			(400)	5 118
Other key items:
Raw materials and consumables (note 8)	(20)			(7)	(2 728)
Staff costs (note 8)	(32)			(443)	(3 365)
Royalties (note 8)1					(533)
Contract mining (note 8)					(963)
Repairs and maintenance (note 8)	(3)			(12)	(1 625)
Railage and transport (note 8)	(1)			(1)	(2 246)
Movement in provisions (note 8)				1
External finance income (note 10)				873	949
External finance costs (note 10)	(1)			(231)	(632)
Share of income/(loss) of equity-accounted investments (note 11)		1 936	(83)		1 916
Income tax (expense)/benefit	5			(67)	(1 125)
Cash generated by/(utilised in) operations (note 9)	(4)			(156)	4 803
Capital spend on property, plant and equipment (note 12)				(11)	(1 061)
At 30 June 2024 (Reviewed)
Segmental assets and liabilities
Deferred tax2	14			196	225
Equity-accounted investments (note 13)		13 861	2 182		20 037
External assets	278	25		19 798	70 998
Total assets	292	13 886	2 182	19 994	91 260
External liabilities	23			3 873	16 372
Deferred tax2				(22)	9 041
Total liabilities	23			3 851	25 413

1 Calculated per legal entity.

2 Offset per legal entity and tax authority.


	Coal
6 months ended 30 June 2023 (Reviewed)	Commercial
6 months ended 30 June 2023 (Reviewed)	Water- berg Rm	Mpuma- langa Rm	Tied Rm	Other Rm	Energy Rm
External revenue (note 7)	11 384	4 000	2 741		610
Segmental net operating profit/(loss)	5 698	211	82	(134)	280
Add back:
Depreciation and amortisation (note 8)	744	296	6	8	195
Net losses on disposal of property, plant and equipment (note 8)	10	1
EBITDA1 (note 26.1)	6 452	508	88	(126)	475

Other key items:
Raw materials and consumables (note 8)1	(973)	(1 261)	(234)
Staff costs (note 8)1	(1 321)	(194)	(776)	(119)	(31)
Royalties (note 8)1;2	(645)	(86)	(23)	70
Contract mining (note 8)1	(24)	(593)
Repairs and maintenance (note 8)1	(797)	(140)	(468)		(3)
Railage and transport (note 8)1	(969)	(647)	(2)
Movement in provisions (note 8)1	200	(19)	45	(3)	1
External finance income (note 10)	14	4		15	16
External finance costs (note 10)	(42)	(44)		(30)	(244)
Share of income of equity-accounted investments (note 11)		275		2
Income tax expense	(1 461)	(50)	(18)	(89)	(31)
Cash generated by/(utilised in) operations (note 9)	6 103	(176)	177	(259)	425
Capital spend on property, plant and equipment (note 12)	(706)	(69)		(2)	(13)
At 30 June 2023 (Reviewed)
Segmental assets and liabilities
Deferred tax3					1
Equity-accounted investments (note 13)		2 845		2 025
External assets	31 056	5 998	1 347	2 952	8 550
Total assets	31 056	8 843	1 347	4 977	8 551
External liabilities	2 238	2 150	1 550	525	4 662
Deferred tax3	7 028	962	(61)	(124)	899
Total liabilities	9 266	3 112	1 489	401	5 561

1 Additional key items included in the measure of segment profit or loss have been presented for each reportable segment.

2 Calculated per legal entity.

3 Offset per legal entity and tax authority.


	Ferrous		Other
6 months ended 30 June 2023 (Reviewed)	Alloys Rm	Other ferrous Rm	Base metals Rm	Other Rm	Total Rm
External revenue (note 7)	205			3	18 943
Segmental net operating profit/(loss)	53			127	6 317
Add back:
Depreciation and amortisation (note 8)				83	1 332
Net losses on disposal of property, plant and equipment (note 8)					11
EBITDA1 (note 26.1)	53			210	7 660

Other key items:
Raw materials and consumables (note 8)1	(31)			(11)	(2 510)
Staff costs (note 8)1	(35)			(432)	(2 908)
Royalties (note 8)1;2					(684)
Contract mining (note 8)1				(1)	(618)
Repairs and maintenance (note 8)1	(3)			(11)	(1 422)
Railage and transport (note 8)1	(1)			(1)	(1 620)
Movement in provisions (note 8)1				(1)	223
External finance income (note 10)				629	678
External finance costs (note 10)				(241)	(601)
Share of income of equity-accounted investments (note 11)		2 631	256		3 164
Income tax expense	(13)			(211)	(1 873)
Cash generated by/(utilised in) operations (note 9)	125			(143)	6 252
Capital spend on property, plant and equipment (note 12)	(1)			(10)	(801)
At 30 June 2023 (Reviewed)
Segmental assets and liabilities
Deferred tax3	6	3		247	257
Equity-accounted investments (note 13)		12 559	2 187		19 616
External assets	369	25		18 222	68 519
Total assets	375	12 587	2 187	18 469	88 392
External liabilities	38	1		5 306	16 470
Deferred tax3				(26)	8 678
Total liabilities	38	1		5 280	25 148

1 Additional key items included in the measure of segment profit or loss have been presented for each reportable segment.

2 Calculated per legal entity.

3 Offset per legal entity and tax authority.


	Coal
12 months ended 31 December 2023 (Audited)	Commercial
12 months ended 31 December 2023 (Audited)	Water- berg Rm	Mpuma- langa Rm	Tied Rm	Other Rm	Energy Rm
External revenue (note 7)	22 496	8 666	5 783		1 345
Segmental net operating profit/(loss)	10 173	399	173	(681)	630
Add back:
Depreciation and amortisation (note 8)	1 512	595	6	16	393
Net losses on disposal of property, plant and equipment (note 8)	17	3
EBITDA (note 26.1)	11 702	997	179	(665)	1 023

Other key items:
Raw materials and consumables (note 8)	(2 002)	(2 755)	(497)	(2)	(1)
Staff costs (note 8)	(2 740)	(395)	(1 737)	(253)	(68)
Royalties (note 8)1	(1 188)	(108)	(13)	167
Contract mining (note 8)	(60)	(1 434)
Repairs and maintenance (note 8)	(1 677)	(282)	(975)	(1)	(9)
Railage and transport (note 8)	(1 744)	(1 424)	(6)
Movement in provisions (note 8)	151	(80)	53	(195)
External finance income (note 10)	26	8		61	40
External finance costs (note 10)	(66)	(97)		(79)	(515)
Share of income/(loss) of equity-accounted investments (note 11)		508		(10)
Income tax expense	(2 603)	(98)	(27)	(118)	(71)
Cash generated by/(utilised in) operations (note 9)	11 758	89	148	(203)	1 031
Capital spend on property, plant and equipment (note 12)	(2 217)	(201)		(15)	(244)
At 31 December 2023 (Audited)
Segmental assets and liabilities
Deferred tax2					14
Equity-accounted investments (note 13)		1 922		2 014
External assets	31 930	6 084	1 506	2 774	8 834
Total assets	31 930	8 006	1 506	4 788	8 848
External liabilities	2 590	2 451	1 600	779	5 121
Deferred tax2	7 335	856	(60)	2	903
Total liabilities	9 925	3 307	1 540	781	6 024

1 Calculated per legal entity.

2 Offset per legal entity and tax authority.


	Ferrous		Other
12 months ended 31 December 2023 (Audited)	Alloys Rm	Other ferrous Rm	Base metals Rm	Other Rm	Total Rm
External revenue (note 7)	398			10	38 698
Segmental net operating profit/(loss)	82			(149)	10 627
Add back:
Depreciation and amortisation (note 8)	1			192	2 715
Net losses on disposal of property, plant and equipment (note 8)				37	57
EBITDA (note 26.1)	83			80	13 399

Other key items:
Raw materials and consumables (note 8)	(58)			(17)	(5 332)
Staff costs (note 8)	(69)			(829)	(6 091)
Royalties (note 8)1					(1 142)
Contract mining (note 8)					(1 494)
Repairs and maintenance (note 8)	(6)			(19)	(2 969)
Railage and transport (note 8)	(3)			(1)	(3 178)
Movement in provisions (note 8)				1	(70)
External finance income (note 10)				1 435	1 570
External finance costs (note 10)	(1)			(494)	(1 252)
Share of income/(loss) of equity-accounted investments (note 11)		6 157	332		6 987
Income tax expense	(18)			(296)	(3 231)
Cash generated by/(utilised in) operations (note 9)	234			250	13 307
Capital spend on property, plant and equipment (note 12)	(1)			(21)	(2 699)
At 31 December 2023 (Audited)
Segmental assets and liabilities
Deferred tax2	9			183	206
Equity-accounted investments (note 13)		14 079	2 263		20 278
External assets	300	26		20 916	72 370
Total assets	309	14 105	2 263	21 099	92 854
External liabilities	40	3		4 860	17 444
Deferred tax2				(33)	9 003
Total liabilities	40	3		4 827	26 447

1 Calculated per legal entity.

2 Offset per legal entity and tax authority.

An interim cash dividend, number 43, for 2024 of 796 cents per share, was approved by the board of directors on 13 August 2024. The dividend is payable on 7 October 2024 to shareholders who will be on the register on 4 October 2024. This interim dividend, amounting to approximately R1 923 million
(to external shareholders), has not been recognised as a liability in these interim financial statements.
It will be recognised in shareholders’ equity in the second half of the year ending 31 December 2024.

The interim dividend declared from income reserves, will be subject to a dividend withholding tax of 20%, for all shareholders who are not exempt from or do not qualify for a reduced rate of dividend withholding tax. The net local dividend payable to shareholders, subject to dividend withholding tax at a rate of 20% amounts to 636.80000 cents per share.

The number of ordinary shares in issue at the date of this declaration is 349 305 092. Exxaro company’s tax reference number is 9218/098/14/4.

The final cash dividend relating to the 2023 financial year of 1 010 cents per share, amounting to R2 439 million (to external shareholders), was declared on 12 March 2024 and paid on 13 May 2024.

Given the net cash position at 31 December 2023 of R14 834 million (excluding energy’s net debt), the board of directors declared a special dividend of 572 cents per share. The special dividend, amounting to R1 382 million (to external shareholders), was declared on 12 March 2024 and paid on 13 May 2024.


	6 months ended 30 June 2024 Reviewed Rm	6 months ended 30 June 2023 Reviewed Rm	12 months ended 31 December 2023 Audited Rm
Dividends paid	3 821	2 744	5 505
Final dividend	2 439	2 744	2 744
Special dividend	1 382
Interim dividend			2 761


	cents	cents	cents
Dividend paid per share	1 582	1 136	2 279
Final dividend	1 010	1 136	1 136
Special dividend	572
Interim dividend			1 143


	At 30 June 2024 Reviewed	At 30 June 2023 Reviewed	At 31 December 2023 Reviewed
Issued share capital (number of shares)1	349 305 092	349 305 092	349 305 092
Ordinary shares (millions)
– Weighted average number of shares	242	242	242
– Diluted weighted average number of shares	242	242	242

1 Includes treasury shares of 107 770 244 (30 June 2023: 107 770 244; 31 December 2023: 107 770 244).

Revenue is derived from contracts with customers. Revenue has been disaggregated based on timing of revenue recognition, major type of goods and services, major geographic area and major customer industries.


	Coal					Ferrous	Other
	Commercial
6 months ended 30 June 2024 (Reviewed)	Water- berg Rm	Mpuma- langa Rm	Tied Rm	Other Rm	Energy Rm	Alloys Rm	Other Rm	Total Rm
Segmental revenue reconciliation
Segmental revenue1	10 657	4 636	2 958		652	75	3	18 981
Export sales allocated to selling entity2	(1 721)	(4 091)		5 812
Total revenue	8 936	545	2 958	5 812	652	75	3	18 981
By timing and major type of goods and services
Revenue recognised at a point in time	8 936	545	2 559	5 812		73	3	17 928
Coal	8 936	545	2 559	5 812				17 852
Ferrosilicon						73		73
Biological goods							3	3
Revenue recognised over time			399		652	2		1 053
Renewable energy					652			652
Stock yard management services			106			2		108
Project engineering services			293					293

Total revenue	8 936	545	2 958	5 812	652	75	3	18 981
By major geographic area of customer3
Domestic	8 936	545	2 958		652	75	3	13 169
Export				5 812				5 812
Europe4				2 224				2 224
Asia5				3 356				3 356
Other				232				232

Total revenue	8 936	545	2 958	5 812	652	75	3	18 981
By major customer industries
Public utilities	7 898		2 958	101	652			11 609
Merchants	142	231		5 201				5 574
Steel	475	73						548
Mining	84	51				49		184
Manufacturing	117					26		143
Food and beverage	93						3	96
Cement	95	69		361				525
Chemicals		109						109
Other	32	12		149				193
Total revenue	8 936	545	2 958	5 812	652	75	3	18 981

1 Coal segmental revenue is based on the origin of coal production.

2 Relates to revenue sold by export distribution entity.

3 Determined based on the customer supplied by Exxaro.

4 Relates mainly to Switzerland.

5 Relates mainly to Singapore.


	Coal					Ferrous	Other
	Commercial
6 months ended 30 June 2023 (Reviewed)	Water- berg Rm	Mpuma- langa Rm	Tied Rm	Other Rm	Energy Rm	Alloys Rm	Other Rm	Total Rm
Segmental revenue reconciliation
Segmental revenue1	11 384	4 000	2 741		610	205	3	18 943
Export sales allocated to selling entity2	(2 522)	(3 151)		5 673
Total revenue	8 862	849	2 741	5 673	610	205	3	18 943
By timing and major type of goods and services
Revenue recognised at a point in time	8 862	849	2 177	5 673		203	2	17 766
Coal	8 862	849	2 177	5 673				17 561
Ferrosilicon						203		203
Biological goods							2	2
Revenue recognised over time			564		610	2	1	1 177
Renewable energy					610			610
Stock yard management services			74					74
Project engineering services			490					490
Transportation services						1		1
Other services						1	1	2

Total revenue	8 862	849	2 741	5 673	610	205	3	18 943
By major geographic area of customer3
Domestic	8 862	849	2 741		610	205	3	13 270
Export				5 673				5 673
Europe4				2 548				2 548
Asia5				2 822				2 822
Other				303				303

Total revenue	8 862	849	2 741	5 673	610	205	3	18 943
By major customer industries
Public utilities	7 417		2 741	505	610			11 273
Merchants	196	410		5 060				5 666
Steel	594	76						670
Mining	133					185		318
Manufacturing	253					20		273
Food and beverage	104							104
Cement	133	6		108				247
Chemicals		351						351
Other	32	6					3	41
Total revenue	8 862	849	2 741	5 673	610	205	3	18 943

1 Coal segmental revenue is based on the origin of coal production.

2 Relates to revenue sold by export distribution entity.

3 Determined based on the customer supplied by Exxaro.

4 Relates mainly to Switzerland and Germany.

5 Relates mainly to Japan and Singapore.


	Coal					Ferrous	Other
	Commercial
12 months ended 31 December 2023 (Audited)	Water- berg Rm	Mpuma- langa Rm	Tied Rm	Other Rm	Energy Rm	Alloys Rm	Other Rm	Total Rm
Segmental revenue reconciliation
Segmental revenue1	22 496	8 666	5 783		1 345	398	10	38 698
Export sales allocated to selling entity2	(4 538)	(6 539)		11 077
Total revenue	17 958	2 127	5 783	11 077	1 345	398	10	38 698
By timing and major type of goods and services
Revenue recognised at a point in time	17 958	2 127	4 729	11 077		392	9	36 292
Coal	17 958	2 127	4 729	11 077				35 891
Ferrosilicon						392		392
Biological goods							9	9
Revenue recognised over time			1 054		1 345	6	1	2 406
Renewable energy					1 345			1 345
Stock yard management services			159					159
Project engineering services			895					895
Transportation services						2		2
Other services						4	1	5

Total revenue	17 958	2 127	5 783	11 077	1 345	398	10	38 698
By major geographic area of customer3
Domestic	17 958	2 127	5 783		1 345	398	8	27 619
Export				11 077			2	11 079
Europe4				5 522			1	5 523
Asia5				4 600			1	4 601
Other				955				955

Total revenue	17 958	2 127	5 783	11 077	1 345	398	10	38 698
By major customer industries
Public utilities	14 963		5 783	511	1 345			22 602
Merchants	370	1 230		9 826		2		11 428
Steel	1 462	152						1 614
Mining	250	23				351		624
Manufacturing	357					45		402
Food and beverage	233						2	235
Cement	262	70		314				646
Chemicals		646						646
Other	61	6		426			8	501
Total revenue	17 958	2 127	5 783	11 077	1 345	398	10	38 698

1 Coal segmental revenue is based on the origin of coal production.

2 Relates to revenue sold by export distribution entity.

3 Determined based on the customer supplied by Exxaro.

4 Relates mainly to Switzerland and Germany.

5 Relates mainly to Singapore and Japan.


	6 months ended 30 June 2024 Reviewed Rm	6 months ended 30 June 2023 Reviewed Rm	12 months ended 31 December 2023 Audited Rm
Raw materials and consumables	(2 728)	(2 510)	(5 332)
Staff costs	(3 365)	(2 908)	(6 091)
Royalties	(533)	(684)	(1 142)
Contract mining	(963)	(618)	(1 494)
Repairs and maintenance	(1 625)	(1 422)	(2 969)
Railage and transport	(2 246)	(1 620)	(3 178)
Movement in provisions (note 18)		223	(70)
Depreciation and amortisation	(1 404)	(1 332)	(2 715)
– Depreciation of property, plant and equipment	(1 245)	(1 222)	(2 483)
– Depreciation of right-of-use assets	(30)	(27)	(57)
– Amortisation of intangible assets	(129)	(83)	(175)
Net losses on disposal of property, plant and equipment	(9)	(11)	(57)
Losses on disposal of intangible assets	(11)
Net realised and unrealised currency exchange differences	57	255	124
Legal and professional fees	(157)	(152)	(487)
ECLs on financial assets at amortised cost	(8)	(5)	(21)


	6 months ended 30 June 2024 Reviewed Rm	6 months ended 30 June 2023 Reviewed Rm	12 months ended 31 December 2023 Audited Rm
Profit before tax	5 927	9 558	17 934
Adjusted for:
Finance income	(949)	(678)	(1 570)
Finance costs	632	601	1 252
Dividend income from financial assets			(2)
Share of income of equity-accounted investments	(1 916)	(3 164)	(6 987)
Net operating profit	3 694	6 317	10 627
Non-cash movements:
Depreciation and amortisation	1 404	1 332	2 715
ECLs on financial assets at amortised cost	8	5	21
Write-off of trade and other receivables and ESD loans	4		6
Write-off of other assets		9	32
Movement in provisions		(223)	70
Movement in retirement employee obligation	6	6	11
Net currency exchange differences	(63)	(74)	(46)
Fair value adjustments on financial instruments	(132)	(145)	(284)
Net losses on disposal of property, plant and equipment	9	11	57
Losses on disposal of intangible assets	11
Indemnification asset movement			5
Share-based payment expense	95	111	212
Hedge ineffectiveness on cash flow hedges	5	8	18
Translation of foreign currency items	(30)	(139)	(85)
Amortisation of transaction costs prepaid	4	4	4
Non-cash recoveries	7	35	23
Non-cash deposit facilities		(373)	(373)
Non-cash management fees	6		53
Other non-cash movements		20	8
Cash generated by operations before working capital movements	5 028	6 904	13 074
Working capital movements
Increase in inventories	(269)	(97)	(212)
Decrease in trade and other receivables	518	482	449
(Decrease)/increase in trade and other payables	(437)	(1 009)	68
Utilisation of provisions	(37)	(28)	(72)
Cash generated by operations	4 803	6 252	13 307


	6 months ended 30 June 2024 Reviewed Rm	6 months ended 30 June 2023 Reviewed Rm	12 months ended 31 December 2023 Audited Rm
Finance income	949	678	1 570
Interest income	951	679	1 573
Reimbursement of interest income on environmental rehabilitation funds	(5)	(4)	(9)
Finance lease interest income	3	3	6
Finance costs	(632)	(601)	(1 252)
Interest expense	(525)	(481)	(1 020)
Net fair value gain/(loss) on interest rate swaps designated as cash flow hedges recycled from OCI:	16	14	20
- Realised fair value loss	(15)	(29)	(44)
- Unrealised fair value gain	31	43	64
Unwinding of discount rate on rehabilitation costs	(142)	(121)	(244)
Recovery of unwinding of discount rate on rehabilitation costs	13	14	28
Interest expense on lease liabilities	(23)	(24)	(48)
Amortisation of transaction costs	(3)	(3)	(5)
Borrowing costs capitalised1	32		17

Total net financing income	317	77	318
1 Borrowing costs capitalisation rate relating to LSP (%)	9.51		9.93


	6 months ended 30 June 2024 Reviewed Rm	6 months ended 30 June 2023 Reviewed Rm	12 months ended 31 December 2023 Audited Rm
Associates	1 856	2 889	6 479
SIOC	1 936	2 631	6 157
RBCT	3	2	(10)
Black Mountain	(83)	256	332
Joint ventures	60	275	508
Mafube	60	275	508

Share of income of equity-accounted investments	1 916	3 164	6 987


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Capital spend
To maintain operations	1 056	788	2 455
To expand operations	5	13	244
Total capital spend on property, plant and equipment	1 061	801	2 699


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Capital commitments
Contracted	3 256	3 852	4 115
– Contracted for the group (owner-controlled)	1 765	1 588	2 115
– Share of capital commitments of associates	1 397	2 168	1 973
– Share of capital commitments of joint ventures	94	96	27
Authorised, but not contracted (owner-controlled)	1 513	1 030	2 287


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Associates	18 060	16 771	18 356
SIOC	13 861	12 559	14 079
RBCT	2 017	2 025	2 014
Black Mountain	2 182	2 187	2 263
Joint Ventures	1 977	2 845	1 922
Mafube	1 977	2 845	1 922

Total net carrying value of equity-accounted investments	20 037	19 616	20 278


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Non-current	720	731	729
Reimbursements1	589	577	588
Biological assets	32	36	33
Lease receivables	24	33	29
Other	75	85	79
Current	320	290	482
VAT	16	8	37
Diesel rebates	41	115	58
Royalties	69	99	69
Prepayments2	132	21	254
Lease receivables	10	9	9
Other	52	38	55

Total other assets	1 040	1 021	1 211

1 Amounts recoverable from Eskom in respect of the rehabilitation, environmental expenditure and retirement employee obligations of the Matla operation at the end of LoM.

2 Includes an amount of R120 million (30 June 2023: nil; 31 December 2023: R123 million) which relates to advance payments for assets under construction.


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Non-current1	7 479	7 386	7 480
Loan facility	2 722	3 168	2 945
Project financing2	4 757	4 218	4 535
Current1	818	1 398	1 443
Loan facility	503	510	507
Project financing2	315	242	290
Bonds3		646	646

Total interest-bearing borrowings	8 297	8 784	8 923
Summary of interest-bearing borrowings by period of redemption:
Less than six months	431	407	1 074
Six to 12 months	387	991	369
Between one and two years	3 115	756	794
Between two and three years	505	3 115	2 948
Between three and four years	620	501	556
Between four and five years	744	614	682
Over five years	2 495	2 400	2 500
Total interest-bearing borrowings	8 297	8 784	8 923
1 Reduced by the amortisation of transaction costs:
– Non-current	(14)	(7)	(17)
– Current	(5)	(5)	(5)
2 Interest-bearing borrowings relating to the energy operations.
3 The R643 million senior unsecured floating rate note matured in June 2024.
Overdraft
Bank overdraft1		144
1 The bank overdraft is repayable on demand. Interest is based on current South African money market rates.
Analysis of movement in interest-bearing borrowings1
At beginning of the period	8 923	9 093	9 093
Interest-bearing borrowings raised	388		489
Interest-bearing borrowings repaid	(1 009)	(318)	(658)
Interest expense	504	466	982
Interest paid	(512)	(460)	(975)
Capitalisation of transaction costs			(13)
Amortisation of transaction costs	3	3	5
At end of the period	8 297	8 784	8 923

1 Additional information has been published to enhance disclosures for 30 June 2023.

There were no defaults or breaches in terms of interest-bearing borrowings during the reporting periods.

Below is a summary of the salient terms and conditions of the facilities at 30 June 2024:


							Interest payment basis	Interest rate	Effective rate for transaction costs
Facilities	Carrying value Rm	Undrawn portion Rm	Security	Debt assumed date	Maturity date	Facilities	Base rate	Margin
Exxaro loan facility						Exxaro loan facility
Bullet term loan	2 540	nil	Unsecured	26 April 2021	26 April 2026	Bullet term loan	Floating	3-month JIBAR	240 basis points (2.40%)	0.11%
Amortised term loan	685	nil	Unsecured	26 April 2021	26 April 2026	Amortised term loan	Floating	3-month JIBAR	230 basis points (2.30%)	0.08%
Revolving credit facility	nil	3 250	Unsecured	26 April 2021	26 April 2026	Revolving credit facility	Floating	1-month JIBAR	265 basis points (2.65%)	N/A
Project financing						Project financing
Amakhala SPV:						Amakhala SPV:
Term loan and reserve facility	2 438	273	Secured	01 April 2020	30 June 2031	Term loan and reserve facility	Floating	3-month JIBAR	370 to 681 basis points (3.70% to 6.81%)	N/A
Term loan	132	nil	Secured	01 April 2020	30 June 2031	Term loan	Fixed	9.46% up to June 2026, thereafter 3-month JIBAR	360 to 670 basis points (3.60% to 6.70%)	N/A
Tsitsikamma SPV:						Tsitsikamma SPV:
Term loan and reserve facility	1 652	148	Secured	01 April 2020	31 Dec 2030	Term loan and reserve facility	Floating	3-month JIBAR	276 basis points (2.76%)	N/A
LSP SPV:						LSP SPV:
Term loan and reserve facility	850	466	Secured	11 July 2023	31 Dec 2042	Term loan and reserve facility	Floating	3-month JIBAR	250 to 360 basis points (2.50% to 3.60%)	0.01% were applicable
Revolving credit facility	nil	49	Secured	11 July 2023	31 Dec 2024	Revolving credit facility	Floating	3-month JIBAR	180 basis points (1.80%)	N/A

Interest payment

basis

Interest rate

Effective

rate for

transaction

costs

Facilities

Carrying

value

Rm

Undrawn

portion

Rm

Security

Debt assumed

date

Maturity

date

Facilities

Base rate

Margin

Exxaro loan facility

Bullet term loan

2 540

nil

Unsecured

26 April 2021

26 April 2026

Bullet term loan

Floating

3-month JIBAR

240 basis points (2.40%)

0.11%

Amortised term loan

685

nil

Unsecured

26 April 2021

26 April 2026

Amortised term loan

Floating

3-month JIBAR

230 basis points (2.30%)

0.08%

Revolving credit facility

nil

3 250

Unsecured

26 April 2021

26 April 2026

Revolving credit facility

Floating

1-month JIBAR

265 basis points (2.65%)

N/A

Project financing

Amakhala SPV:

Term loan and reserve facility

2 438

273

Secured

01 April 2020

30 June 2031

Term loan and reserve facility

Floating

3-month JIBAR

370 to 681 basis points

(3.70% to 6.81%)

N/A

Term loan

132

nil

Secured

01 April 2020

30 June 2031

Term loan

Fixed

9.46% up to

June 2026, thereafter

3-month JIBAR

360 to 670 basis points

(3.60% to 6.70%)

N/A

Tsitsikamma SPV:

Term loan and reserve facility

1 652

148

Secured

01 April 2020

31 Dec 2030

Term loan and reserve facility

Floating

3-month JIBAR

276 basis points (2.76%)

N/A

LSP SPV:

Term loan and reserve facility

850

466

Secured

11 July 2023

31 Dec 2042

Term loan and reserve facility

Floating

3-month JIBAR

250 to 360 basis points

(2.50% to 3.60%)

0.01% were

applicable

Revolving credit facility

nil

49

Secured

11 July 2023

31 Dec 2024

Revolving credit facility

Floating

3-month JIBAR

180 basis points (1.80%)

N/A


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Non-current	376	419	400
Current	56	45	51
Total lease liabilities	432	464	451
Summary of lease liabilities by period of redemption:
Less than six months	27	21	24
Six to 12 months	29	24	27
Between one and two years	68	56	62
Between two and three years	84	69	76
Between three and four years	90	73	81
Between four and five years	79	89	98
Over five years	55	132	83
Total lease liabilities	432	464	451
Analysis of movement in lease liabilities
At beginning of the period	451	478	478
New leases	1		2
Lease remeasurement adjustments	4	6	12
Capital repayments	(24)	(20)	(41)
– Lease payments	(47)	(44)	(89)
– Interest charges	23	24	48

At end of the period	432	464	451
The lease liabilities relate to the right-of-use assets.
Interest is based on incremental borrowing rates ranging as follows:
– Local leases with lease term between 12 and 18 months (%)	11.75	11.75	11.75
– Foreign lease with lease term between 12 and 18 months (%)	1.35	1.75	1.35
– Local leases with lease term greater than 18 months (%)	10.25 to 10.86	8.97 to 10.43	10.25 to 10.87


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Net cash is presented by the following items on the statement of financial position:
Non-current interest-bearing debt	(7 855)	(7 805)	(7 880)
Interest-bearing borrowings	(7 479)	(7 386)	(7 480)
Lease liabilities	(376)	(419)	(400)
Current interest-bearing debt	(874)	(1 443)	(1 494)
Interest-bearing borrowings	(818)	(1 398)	(1 443)
Lease liabilities	(56)	(45)	(51)
Net cash and cash equivalents	18 499	16 473	19 859
Cash and cash equivalents	18 499	16 617	19 859
Overdraft		(144)

Total net cash	9 770	7 225	10 485


	Environmental rehabilitation
	Restoration Rm	Decommis- sioning Rm	Residual impact Rm	Other site closure cost Rm	Other Rm	Total Rm
At 30 June 2024 (Reviewed)
At beginning of the period	1 823	258	975	127	2	3 185
(Reversal)/charge to operating expenses (note 8)	(13)	9	5	(1)
Unwinding of discount rate (note 10)	101	16	20	5		142
Change in provisions capitalised to property, plant and equipment	2	(20)				(18)
Utilised during the period	(23)		(2)	(10)	(2)	(37)
Total provisions at end of the period	1 890	263	998	121		3 272
Non-current	1 741	262	913	99		3 015
Current	149	1	85	22		257

At 30 June 2023 (Reviewed)
At beginning of the period	1 682	305	832	118	4	2 941
(Reversal)/charge to operating expenses (note 8)	(169)	(64)	3	7		(223)
Unwinding of discount rate (note 10)	87	17	12	5		121
Change in provisions capitalised to property, plant and equipment		(22)				(22)
Utilised during the period	(18)		(1)	(7)	(2)	(28)
Total provisions at end of the period	1 582	236	846	123	2	2 789
Non-current	1 447	236	804	106		2 593
Current	135		42	17	2	196

At 31 December 2023 (Audited)
At beginning of the year	1 682	305	832	118	4	2 941
Charge/(reversal) to operating expenses (note 8)	10	(81)	122	19		70
Unwinding of discount rate (note 10)	178	32	24	10		244
Change in provisions capitalised to property, plant and equipment		2				2
Utilised during the period	(47)		(3)	(20)	(2)	(72)
Total provisions at end of the year	1 823	258	975	127	2	3 185
Non-current	1 692	257	908	106		2 963
Current	131	1	67	21	2	222


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Non-current	44	26	35
Long-term incentives	20		10
Income received in advance	24	26	25
Current	875	744	787
Leave pay	267	251	250
Bonuses	357	218	280
VAT	121	114	99
Royalties			40
Carbon tax	4	3	3
Customer advance payments	1		4
Other	125	158	111

Total other liabilities	919	770	822


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Non-current
Financial assets
Financial assets at FVOCI	443	471	434
Equity: unlisted – Chifeng	443	471	434
Financial assets at FVPL	4 007	3 314	3 839
Debt: unlisted – environmental rehabilitation funds	2 531	2 308	2 422
Debt: unlisted – portfolio investments	480	433	461
Debt: unlisted – deposit facilities1	996	573	956
Financial assets at amortised cost	311	418	341
ESD loans2	94	127	106
– Gross	155	168	156
– Impairment allowances	(61)	(41)	(50)
Vendor finance loan3	104	150	127
– Gross	104	150	127
Other financial assets at amortised cost	113	141	108
– Environmental rehabilitation funds	113	103	108
– Deferred pricing receivable4		39
– Impairment allowances		(1)

Derivative financial assets designated as hedging instruments	2	19	2
Cash flow hedge derivatives: interest rate swaps5	2	19	2
Financial liabilities
Financial liabilities at amortised cost	(7 520)	(7 454)	(7 522)
Interest-bearing borrowings	(7 479)	(7 386)	(7 480)
Other payables	(41)	(68)	(42)
Derivative financial liabilities designated as hedging instruments	(99)	(60)	(127)
Cash flow hedge derivatives: interest rate swaps5	(99)	(60)	(127)

1 Deposit or credit facilities that are contractual arrangements with insurance providers with an initial five-year term and are used to cover insurance claims over the term of the contracts. The balance of the facility is refunded at the end of the term, net of fees, returns and claims incurred. Annual premiums are required to be placed in the facility over the term yielding returns on underlying fund portfolios.

2 Interest-free loans advanced to successful applicants in terms of the Exxaro ESD programme.

3 Vendor finance loan granted to Overlooked Colliery as part of the disposal of the ECC operation. The loan is unsecured, repayable from 1 October 2022 and bears interest at:

Prime Rate for the period 3 September 2021 to 30 September 2024

Prime Rate plus 1 for the period 1 October 2024 to 30 September 2025

Prime Rate plus 2 for the period 1 October 2025 to 30 September 2026

Prime Rate plus 3 for the period 1 October 2026 to 30 September 2027.

4 Relates to a deferred pricing adjustment which arose during 2017. The amount receivable will be settled over seven years (ending 2024) and bears interest at Prime Rate less 2%.

5 Relates to interest rate swaps designated in a hedging relationship to hedge interest rate risk exposure resulting from interest payments on the project financing. The hedges have been assessed as effective.


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Current
Financial assets
Financial assets at amortised cost	22 469	21 098	23 924
ESD loans1	79	84	63
– Gross	202	176	181
– Impairment allowances	(123)	(92)	(118)
Vendor finance loan2	66	81	50
– Gross	67	82	51
– Impairment allowance	(1)	(1)	(1)
Intervention receivable3	8
– Gross	8
Other financial assets at amortised cost	39	95	75
– Deferred pricing receivable4	39	73	77
– Deferred consideration receivable5		25
– Employee receivables	4	4	4
– Impairment allowances	(4)	(7)	(6)
Trade and other receivables	3 778	4 221	3 877
Trade receivables	3 690	4 143	3 829
– Gross	3 703	4 166	3 850
– Impairment allowances	(13)	(23)	(21)
Other receivables	88	78	48
– Gross	98	100	55
– Impairment allowances	(10)	(22)	(7)

Cash and cash equivalents	18 499	16 617	19 859

Financial assets at FVPL	13	48	22
Derivative financial assets	13	48	22
Financial liabilities
Financial liabilities at amortised cost	(3 907)	(4 057)	(4 799)
Interest-bearing borrowings	(818)	(1 398)	(1 443)
Trade and other payables	(3 089)	(2 515)	(3 356)
– Trade payables	(1 697)	(1 464)	(1 893)
– Other payables	(1 392)	(1 051)	(1 463)
Overdraft		(144)
Derivative financial liabilities designated as hedging instruments	(11)		(14)
Cash flow hedge derivatives: interest rate swaps6	(2)
Cash flow hedge derivatives: FECs7	(9)		(14)
Financial liabilities at FVPL	(1)	(3)
Derivative financial liabilities	(1)	(3)

1 Interest-free loans advanced to successful applicants in terms of the Exxaro ESD programme.

2 Vendor finance loan granted to Overlooked Colliery as part of the disposal of the ECC operation. The loan is unsecured, repayable from 1 October 2022 and bears interest at:

Prime Rate for the period 3 September 2021 to 30 September 2024

Prime Rate plus 1 for the period 1 October 2024 to 30 September 2025

Prime Rate plus 2 for the period 1 October 2025 to 30 September 2026

Prime Rate plus 3 for the period 1 October 2026 to 30 September 2027.

3 Relates to amounts advanced for funding of logistical projects.

4 Relates to a deferred pricing adjustment which arose during 2017. The amount receivable will be settled over seven years (ending 2024) and bears interest at Prime Rate less 2%.

5 Relates to deferred consideration receivable which arose on the disposal of the ECC operation.

6 Relates to interest rate swaps designated in a hedging relationship to hedge interest rate risk exposure resulting from interest payments on the project financing. The hedges have been assessed as effective.

7 Relates to FECs designated in a hedging relationship to hedge foreign exchange risk exposure on the purchase of US dollar foreign denominated capital purchases funded by ZAR denominated project financing. The hedges have been assessed as effective.

The carrying amounts of financial instruments measured at amortised cost approximate fair value due to the nature and terms of these instruments.

The group has granted the following loan commitments:


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Total loan commitments1	8	42	12
ESD applicants2	8	42	12

1 The loan commitments were undrawn for the reporting periods.

2 Loans approved and awarded to successful ESD applicants.

Fair value hierarchy

The table below analyses recurring fair value measurements for financial assets and financial liabilities. These fair value measurements are categorised into different levels in the fair value hierarchy based on the inputs to the valuation techniques used. The different levels are defined as follows:

Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the group can access at the measurement date.

Level 2 – Inputs other than quoted prices included in Level 1 that are either directly or indirectly observable.

Level 3 – Inputs that are not based on observable market data (unobservable inputs).


At 30 June 2024 (Reviewed)	Fair value Rm	Level 2 Rm	Level 3 Rm
Financial assets at FVOCI	443		443
Equity: unlisted – Chifeng	443		443
Financial assets at FVPL	4 007	4 007
Non-current debt: unlisted – environmental rehabilitation funds	2 531	2 531
Non-current debt: unlisted – portfolio investments	480	480
Non-current debt: unlisted – deposit facilities	996	996
Derivative financial assets designated as hedging instruments	2	2
Non-current cash flow hedge derivatives: interest rate swaps	2	2
Derivative financial assets	13	13
Current derivative financial assets	13	13
Derivative financial liabilities designated as hedging instruments	(110)	(110)
Non-current cash flow hedge derivatives: interest rate swaps	(99)	(99)
Current hedging derivatives: interest rate swaps	(2)	(2)
Current hedging derivatives: FECs	(9)	(9)
Derivative financial liabilities	(1)	(1)
Current derivative financial liabilities	(1)	(1)

Net financial assets held at fair value	4 354	3 911	443


At 30 June 2023 (Reviewed)	Fair value Rm	Level 2 Rm	Level 3 Rm
Financial assets at FVOCI	471		471
Equity: unlisted – Chifeng	471		471
Financial assets at FVPL	3 314	3 314
Non-current debt: unlisted – environmental rehabilitation funds	2 308	2 308
Non-current debt: unlisted – portfolio investments	433	433
Non-current debt: unlisted – deposit facilities	573	573
Derivative financial assets designated as hedging instruments	19	19
Non-current cash flow hedge derivatives: interest rate swaps	19	19
Derivative financial assets	48	48
Current derivative financial assets	48	48
Derivative financial liabilities designated as hedging instruments	(60)	(60)
Non-current cash flow hedge derivatives: interest rate swaps	(60)	(60)
Derivative financial liabilities	(3)	(3)
Current derivative financial liabilities	(3)	(3)

Net financial assets held at fair value	3 789	3 318	471


At 31 December 2023 (Audited)	Fair value Rm	Level 2 Rm	Level 3 Rm
Financial assets at FVOCI	434		434
Equity: unlisted – Chifeng	434		434
Financial assets at FVPL	3 839	3 839
Non-current debt: unlisted – environmental rehabilitation funds	2 422	2 422
Non-current debt: unlisted – portfolio investments	461	461
Non-current debt: unlisted – deposit facilities	956	956
Derivative financial assets designated as hedging instruments	2	2
Non-current cash flow hedge derivatives: interest rate swaps	2	2
Derivative financial assets	22	22
Current derivative financial assets	22	22
Derivative financial liabilities designated as hedging instruments	(141)	(141)
Non-current cash flow hedge derivatives: interest rate swaps	(127)	(127)
Current hedging derivatives: FECs	(14)	(14)

Net financial assets held at fair value	4 156	3 722	434

Reconciliation of financial assets within Level 3 of the hierarchy:


		Chifeng Rm
	At 31 December 2022 (Audited)	474
	Movement during the period
	Losses recognised in OCI (pre-tax effect)1	(3)
	At 30 June 2023 (Reviewed)	471
	Movement during the period
	Losses recognised in OCI (pre-tax effect)1	(37)
	At 31 December 2023 (Audited)	434
	Movement during the period
	Gains recognised in OCI (pre-tax effect)1	9
	At 30 June 2024 (Reviewed)	443

1 Tax on Chifeng amounts to R2 million (30 June 2023: R0.66 million; 2H23: R8 million).

Transfers

Transfers between levels of the fair value hierarchy are recognised at the end of the reporting period during which the transfer has occurred. There were no transfers between Level 1 and Level 2 nor between Level 2 and Level 3 of the fair value hierarchy.

Valuation process applied

The fair value computations of investments are performed by the strategic finance department, reporting to the finance director, on a six-monthly basis. The valuation reports are discussed with the chief operating decision maker and the audit committee in accordance with Exxaro’s reporting governance.

Current derivative financial instruments

Level 2 fair values for simple over-the-counter derivative financial instruments are based on market quotes. These quotes are assessed for reasonability by discounting estimated future cash flows using the market rate for similar instruments at measurement date.

Environmental rehabilitation funds, portfolio investments and deposit facilities

Level 2 fair values for debt instruments held in the environmental rehabilitation funds, portfolio investments and deposit facilities are based on quotes provided by the financial institutions at which the funds are invested at measurement date.

Non-current cash flow hedge derivatives: interest rate swaps

Level 2 fair values for interest rate swaps are based on valuations provided by the financial institutions with whom the swaps have been entered into, and take into account credit risk. The valuations are assessed for reasonability by discounting the estimated future cash flows based on observable ZAR swap curves.

Current cash flow hedge derivatives: forward exchange contracts

Level 2 fair values for hedge accounted FECs are based on valuations provided by the financial institutions with whom the FECs have been entered into, and take into account credit risk. The valuations are assessed for reasonability by discounting the estimated future cash flows based on observable ZAR/US$ forward rates.

Valuation techniques used in the determination of fair values within Level 3 of the hierarchy

Chifeng is classified within a Level 3 of the fair value hierarchy as there is no quoted market price or observable price available for this investment. This unlisted investment is valued as the present value of the estimated future cash flows, using a DCF model. The valuation technique is consistent to that used in previous reporting periods.

21. CONTINGENT LIABILITIES AND CONTINGENT ASSETS

21.1 Contingent liabilities


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Pending litigation and other claims1	113	115	112
Operational guarantees2	4 180	4 236	4 183
– Financial guarantees ceded to the DMRE	3 552	3 552	3 552
– Other financial guarantees	628	684	631

Total contingent liabilities	4 293	4 351	4 295

1 Relates to commercial disputes of which the outcome is uncertain.

2 Includes guarantees to banks and other institutions in the normal course of business from which it is anticipated that no material liabilities will arise.

In November 2023, Exxaro received service of an application seeking the permission of the High Court of South Africa to certify classes for purposes of a class action for damages against Exxaro and three of its related entities, being Exxaro Coal Proprietary Limited, Exxaro Coal Mpumalanga Proprietary Limited and Mafube Coal Mining Proprietary Limited, as well as 14 other respondents.

Exxaro filed a notice to oppose the class action on behalf of Exxaro Resources Limited, Exxaro Coal Proprietary Limited and Exxaro Coal Mpumalanga Proprietary Limited and will be filing its answering affidavit in accordance with the agreed timetable.

In August 2023, a farmer adjacent to the Durnacol mine-in-closure in Kwa-Zulu Natal reported white precipitate observed in the Kalbas river as well as in underground water surfacing in that area. Even though an obligation to treat the water exists, the best fit water-treatment plan for Durnacol is still being investigated making the measurement and timing of the possible outflows uncertain. Since monitoring of the volume and quality of both underground and surface water has to be performed over a period of time, the outcome of the investigation will only be available once all the required data has been accumulated and consolidated. The liability will be recognised once the best fit water-treatment solution has been identified and quantified.

The timing and occurrence of any possible outflows of the contingent liabilities are uncertain.

Share of equity-accounted investments’ contingent liabilities

At 30 June

2024

Reviewed

Rm

At 30 June

2023

Reviewed

Rm

At 31 December

2023

Audited

Rm

Share of contingent liabilities of equity-accounted investments

1 695

1 423

1 427

21.2 Contingent assets


	At 30 June 2024 Reviewed Rm	At 30 June 2023 Reviewed Rm	At 31 December 2023 Audited Rm
Back-to-back guarantees	134	134	134
Other1	29	64	54
Total contingent assets	163	198	188

1 Relates to performance guarantees issued to Exxaro in terms of various capital project agreements.

The group entered into various sale and purchase transactions with associates and joint ventures during the ordinary course of business. These transactions were subject to terms that are no less, nor more favourable than those arranged with independent third parties.


	30 June 2024 Reviewed Rm	30 June 2023 Unreviewed Rm	31 December 2023 Audited Rm
Items of income/(expense) recognised during the period
Sales of goods and services rendered
– Associates	2	149	269
– Joint ventures		37	45
Purchases of goods and services rendered
– Associates	(76)	(95)	(146)
– Joint ventures	(814)	(891)	(1 851)
Outstanding balances at end of the period
Included in trade and other receivables
– Associates	22	29	31
– Joint ventures	3	2	4
Included in trade and other payables
– Associates	(11)	(15)	(7)
– Joint ventures	(248)	(153)	(155)

Based on the latest results for the six-month period ended 30 June 2024, the latest board approved budget for 2024, the outlook up to 2028 as well as the available banking facilities and cash generating capability, Exxaro satisfies the criteria of a going concern in the foreseeable future.

Details of the interim dividend are provided in note 6.

The directors are not aware of any other significant matter or circumstance arising after the reporting period up to the date of this report, not otherwise dealt with in this report.

The company’s external auditor, KPMG Inc., has issued their unmodified review report on the reviewed condensed group interim financial statements for the six-month period ended 30 June 2024. The review was conducted in accordance with ISRE 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. The external auditor’s report on the reviewed interim financial statements is included here.

26.1 EBITDA

Management has presented the performance measure EBITDA because it monitors this performance measure at a consolidated level and it believes that this measure is relevant to an understanding of the group’s financial performance. EBITDA is defined as net operating profit before interest, tax, depreciation, amortisation, impairment charges or impairment reversals and net losses or gains on the disposal of assets and investments (including translation differences recycled to profit or loss).

Net operating profit is reconciled to EBITDA as follows:


	6 months ended 30 June 2024 Unreviewed Rm	6 months ended 30 June 2023 Unreviewed Rm	12 months ended 31 December 2023 Unreviewed Rm
Net operating profit	3 694	6 317	10 627
Add back:
Depreciation and amortisation	1 404	1 332	2 715
Net losses on disposal of property, plant and equipment	9	11	57
Losses on disposal of intangible assets	11
EBITDA	5 118	7 660	13 399

EBITDA is not a defined performance measure in IFRS Accounting Standards. The group’s definition of EBITDA may not be comparable with similarly titled performance measures and disclosures by other entities.

26.2 Other key measures


	At 30 June 2024 Unreviewed	At 30 June 2023 Unreviewed	At 31 December 2023 Unreviewed
Closing share price (rand per share)	178.00	164.27	204.48
Market capitalisation (Rbn)	62.18	57.38	71.43
Average rand/US$ exchange rate (for the period ended)	18.72	18.21	18.45
Closing rand/US$ spot exchange rate	18.50	18.75	18.30

Notes to the reviewed condensed group interim financial statements

1. CORPORATE BACKGROUND

2. BASIS OF PREPARATION

3. ACCOUNTING POLICIES AND OTHER COMPLIANCE MATTERS

4. RECONCILIATION OF GROUP HEADLINE EARNINGS

5. SEGMENTAL INFORMATION

6. DIVIDEND DISTRIBUTIONS

7. REVENUE

8. SIGNIFICANT ITEMS INCLUDED IN OPERATING EXPENSES

9. CASH GENERATED BY OPERATIONS

10. NET FINANCING INCOME

11. SHARE OF INCOME OF EQUITY-ACCOUNTED INVESTMENTS

12. CAPITAL SPEND AND CAPITAL COMMITMENTS

13. EQUITY-ACCOUNTED INVESTMENTS

14. OTHER ASSETS

15. INTEREST-BEARING BORROWINGS

16. LEASE LIABILITIES

17. NET CASH

18. PROVISIONS

19. OTHER LIABILITIES

20. FINANCIAL INSTRUMENTS

21. CONTINGENT LIABILITIES AND CONTINGENT ASSETS

22. RELATED PARTY TRANSACTIONS

23. GOING CONCERN

24. EVENTS AFTER THE REPORTING PERIOD

25. EXTERNAL AUDITOR’S REVIEW CONCLUSION

26. SUPPLEMENTARY NON-IFRS FINANCIAL MEASURES