Exxaro's intellectual capital is the unique combination of knowledge, experience, innovation and systems that differentiate us. We leverage these elements to respond to market challenges and position our business for the future.
Our operations must be able to overcome frequent challenges and adapt to change in global and local markets. We use our intellectual capital and differentiation to transition our already successful business into a company that remains sustainable, growth-orientated and values-driven into the future.
Exxaro is focused on driving and leveraging changes to patterns of production, consumption and ways of working to positively impact our business's value and sustainability. We apply our collective knowledge, skills and resources to ensure our business is responsive while safeguarding our people, assets and the business.
We deliver value through:
Purposefully using our intellectual capital enables us to build momentum and resilience in executing on our strategy and business model.
| Material theme | Matter | Supporting our strategy | Our broader impact |
 Adapting to achanging context |
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 Executing ourstrategy |
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 Driving businessresilience |
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The knowledge, experience, innovation and systems that enable business resilience
Developed:
Installed FuelActive technology on haul trucks at Grootegeluk and Mafube
An appropriately skilled, diversified and independent board
Engagement with our stakeholders at the governance roadshow
Exxaro's business resilience encompasses capital allocation, energy investments, innovation and information management, and reputational resilience (engaging our stakeholders).
Looking ahead
We are future proofing Exxaro and enabling a sustainable future for our business. We aim to fast track our decarbonisation and investments to generate predictable long-term cash flows and increase portfolio diversification.
Our capital allocation and project execution remain focused on leveraging the growth investments already made, supporting our early value strategy and sustaining our businesses by implementing our portfolio of sustaining capital projects. Our early value strategy means we are strategic about our capital allocation.
We are focusing on opportunities in South Africa to start with, while monitoring opportunities in new markets for potential entry that meet our investment criteria, building strong foundations for the future and investing in energy assets that enable us to transition to a low-carbon world.
Exxaro is continuing on our transformation journey with a dedicated focus on enterprise-wide
transformation, innovation and digital, leveraging data by turning it into insights, aiding in
decision-making
across the organisation and creating an agile environment.
We continue to strive to attract and
appoint top tech talent to support our Digital@Exxaro strategy.
CASE STUDY:
Decarbonising our mobile equipment fleet
FuelActive is an innovative fuel cleaning system that reduces harmful emissions, fuel consumption, repair and maintenance downtime, and related costs – supporting our goal of systematically decarbonising our fleet.
FuelActive uses a floating pickup to draw clean fuel from the top of the fuel tank, instead of the bottom where contaminants settle. The system improves engine efficiency and reduces fuel consumption while maintaining the manufacturer’s intended emission standards and performance throughout equipment life. A three-month trial of this technology at Mafube compared the performance of our mining truck fleet against the manufacturer’s baseline data (collected over at least six months) – with and without the FuelActive system. We collected and managed data on fuel economy and carbon dioxide emissions every month and presented it to management and FuelActive (as average litres of diesel consumption per hour) at biweekly reviews.
Payback from our
investment within
263 days
CO2
reduction of
762 tonnes
Annual
fuel savings of
R6 million
| Project | Classification (growth/sustaining) | Product | Focus and performance | Capital expenditure |
| Location: Mpumalanga | ||||
| The infrastructure projects at Matla, to achieve a 10Mtpa production objective once fully ramped up, were approved. | ||||
| Matla LoM programme |
Sustaining | 10Mtpa of thermal coal |
Developing infrastructure to support LoM production |
R5.2 billion |
Outlook
Construction of the Matla Mine 1 tunnel development was completed. We aim to complete the incline conveyor in the first half of 2024, the overland conveyor in the first half of 2025 and the support complex and plant in the second half of 2025. Mining equipment manufacturing was completed by the Matla Central Workshop. Mine 2 development was completed. We aim to complete Mine 3 development in the second half of 2024. We expect to complete and conclude the programme in the first half of 2026.
We focus on sustaining a robust coal portfolio with strong cash flow generation through the capital excellence journey and always focusing on the early value strategy. In this process, we continue to evaluate and optimise our portfolio and, where needed, dispose of non-core assets and invest in our coal business to remain resilient. We are targeting average capital of between R2 billion and R2.5 billion annually in real terms.
Coal sales by product tonnes (%)
Capital expenditure in our coal business increased by 12% compared to 2022, driven by investment in sustaining our operations, which is well aligned with our capital guidance.
The increase in sustaining capital is mainly due to higher spend at Grootegeluk to support continuation of the business. Our capital excellence journey is enabling improved project timing, execution and savings.
While the South African logistics environment is challenging given the rail performance to RBCT, we use our intellectual capital to develop new innovative logistics solutions and corridors to ensure we are on a more sustainable strategic path. We successfully exported via alternative ports and continue to look at solutions that will optimise our value chain from our mines to alternative posts, including our road and rail flows.
Exxaro is targeting a total of 1.6GW (net) installed capacity by 2030 with an estimated total equity capital deployment of approximately R13 billion based on high level assumptions, with the remaining capital requirements being project financed. This could potentially provide a forecast estimated EBITDA of approximately R4.9 billion. We are aiming to achieve equity returns on a portfolio basis of 15%.
The LSP reached financial close on 29 June 2023, and construction started shortly thereafter. The project total investment cost is R1.56 billion.
Exxaro's innovation plays a pivotal role in driving our Sustainable Growth and Impact strategy. The main focus is on optimising value creation from our coal business using digital innovation, while diversifying towards resilient minerals and growing our energy business. Our innovation and technology journey is geared to enable the business to be carbon neutral by 2050.
Our approach to innovation is underpinned by our innovation management programme, which aims to take a systematic approach to integrate innovation into our entire business value chain, ie operations, marketing and logistics intelligence, corporate innovation and embracing disruptive innovation through data science and generative AI. The innovation programme is managed through structured processes and governance, while building future in-house capabilities, and measures that enhance Exxaro's strategic objectives.
Exxaro's commitment to technological and social innovation goes beyond conventional mining practices. Implementing innovative mining and processing technologies ensures that the transition towards emerging minerals is financially viable and that Exxaro remains on the lowest cost curve when new operations are introduced. Beyond economic considerations, Exxaro recognises the crucial role of innovation in creating positive social impact.
In a drive to achieve operational effectiveness, we emphasise the importance of technology and innovation to enable our strategy and achieve our goal to become carbon neutral by 2050. Over the years through our innovation journey, Exxaro successfully deployed technology-enabled integrated operating centres, visualised our value chain, deployed predictive analytics and mineral resource integration.
By leveraging technology, we ensure our operations go beyond compliance, measuring and enhancing our social and environmental impact. This includes deploying innovative digital solutions to strengthen Exxaro's contribution to a just energy transition and aligning with global sustainability goals. One of these initiatives, integrated operations centres, facilitates the seamless integration of mineral resources and optimisation to enable effective, data-driven decision making. Integrated operations centres optimise resource utilisation and minimise environmental impacts, enabled through continuous monitoring. The integration of advanced data analytics and automation technologies supports us to achieve our early value strategy and reduce climate-related risks, thus reinforcing Exxaro's commitment to sustainable practices.
Through developments in generative AI, Exxaro will continue to look at opportunities to automate certain processes and deploy technology to ensure we remain competitive.
We empower our people to create impact by cultivating an
innovation culture. This is integral to how we conduct business at
Exxaro, ensuring our sustained success in a constantly evolving
landscape. Exxaro has a deep-rooted culture of innovation - we
believe that innovation is not limited to any particular department,
but rather, it is everyone's responsibility.
This cultural foundation
signifies that innovation is not sporadic, but an integral part of our
values, mindset and practices, embedded in every aspect of how
Exxaro operates. Through this culture, our people are empowered
to create impact.
At Exxaro, we are passionate about creating a positive socio-economic impact in the communities where we operate. This passion motivates Exxaro to integrate social innovation into our operations. Exxaro's innovation and digital journey extends to social innovation, by addressing community challenges through innovative, workable responses to environmental or social challenges. We aim not only to be a modern mining company but also a socially innovative and responsible one. Empowering people through innovative initiatives ensures that Exxaro's growth contributes to the overall development and wellbeing of the economies in which we operate.
In today's digital age, cybersecurity has become an essential component of business resilience. As we increasingly rely on technology and data, the cyber threat landscape also increases – the impact of which extends far beyond financial losses and affects reputation and stakeholder trust.
To mitigate the inherent cyber risk, we implemented a
cybersecurity programme that focuses on preventing cyber
incidents through detection, response and recovery activities.
Our
dedicated resources enhance our cybersecurity threat intelligence
and detection capabilities. We gather insights from emerging
threat patterns and malicious actors, and are committed to
strengthening our security controls.
We implement a robust cybersecurity incident response plan that outlines the steps to be taken in the event of a security breach. This is supported by a disaster recovery plan to ensure that we can recover from major incidents. We also realise the importance of educating our employees on inherent cyber threats and have implemented a cybersecurity awareness programme to educate them about cybersecurity best practices and potential threats, including phishing awareness and social engineering.
We did not record any data breaches this year.
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