Sunday Times Top 100 Companies 2020

METHODOLOGY

● TheSunday TimesTop 100Companies awards acknowledge those listed companies that have generated shareholder returns that outperformed their listed peers.

Themethodologyfor theSundayTimes Top 100Companies waschanged in2019 to focus onlarger enterprises.Companies with a minimum market capitalisation of R5bn at August 31 2020 and a track record of five years’trading from September1 2015 were included.

Selected companies that met the aforementionedcriteriabut arenolongerlisted on the JSEor whose share issuspended at August 312020 were excludedfrom the analysis.The executivemanagement ofArena Holdings has also considered certain subjective qualifying criteria relatingto the Top 100 Companies’perceived compliance with good governance and ethical conduct.

The shareperformance analysisassumes aninitial investmentof R10,000at theclosing price on August 31 2015, held for a period offive yearsfromSeptember1 2015toAugust31 2020,andthecompanies areranked based on the compoundannual growth rate (CAGR) over the five-year period.

Thisanalysis assumesthat afraction ofa share can be purchased.

Corporate actions during the review period were adjusted for as follows:

● Ordinary and specialdividends: the grossdividend pershare isassumed tobe reinvested inthe company onthe dividend payment date at that date’s closing share price.

● Scrip dividends: assumedthat the cash option was elected and that the gross dividend isreinvested in the companyas described above.

● Capitalisationissue: sharesreceived are held until the end of the review period.

● Unbundling:the shares inNewCo received are assumed to be received on the last date to trade andare tracked separately. The compound annualgrowth rateis calculated based on the basket of shares held at the end of the periodas a result ofthe original R10,000 investment.

● Share split/consolidation: share price datawasadjusted forthesecorporate events.Companies thatundertook thiscorporateactionand declareddividendsin the review period were adjusted accordingly.

● Rights issue: assumedthat rights are not taken up and lapse, therefore no adjustment made.

* The results werecompiled by Vestra

sory and

DRDGOLD

Harmony Gold Mining Company

Kumba Iron Ore

Gold Fields

Cartrack Holdings

AngloGold Ashanti

Anglo American Platinum

African Rainbow Minerals

Pan African Resources PLC

Northam Platinum

Sibanye Stillwater

Allied Electronics Corporation

Exxaro Resources

Impala Platinum Holdings

Anglo American PLC

Naspers

Clicks Group

Sirius Real Estate

BHP Group PLC

Anheuser Busch Inbev NV

Transaction Capital

Afrimat

South32

Equites Property Fund

Royal Bafokeng Platinum

Investec Australia Property Fund

Capitec Bank Holdings

Stenprop

African Oxygen

Glencore PLC

Bidvest Group

Santam

Italtile

Wilson Bayly Holmes-Ovcon

Compagnie Financiere Richemont SA

Mondi PLC

Trustco Group Holdings

Vodacom Group

Reinet Investments SCA

Fortress Reit

JSE

AVI

Sanlam

British American Tobacco PLC

AECI

SPAR Group

Astral Foods

Discovery

Standard Bank Group

PSG Konsult

FirstRand

Adcock Ingram Holdings

PSG Group

Barloworld

Coronation Fund Managers

Old Mutual

Rand Merchant Investment Holdings

Oceana Group

Investec Property Fund

MAS Real Estate Inc

Shoprite Holdings

Pick n Pay Stores

Tiger Brands

Growthpoint Properties

Momentum Metropolitan Holdings

Reunert

Absa Group

Liberty Holdings

Investec

Foschini Group

Investec PLC

RCL Foods

Mr Price Group

Mediclinic International PLC

Sappi

Nedbank Group

Super Group

Life Healthcare Group Holdings

Resilient Reit

Kap Industrial Holdings

MTN Group

Truworths International

Telkom SA SOC

RDI Reit PLC

Imperial Logistics

Aspen Pharmacare Holdings

Woolworths Holdings

Remgro

Netcare

Sasol

Redefine Properties

Capital & Counties Properties PLC

Massmart Holdings

9,797 9,587 9,420 9,160 9,152 8,859 8,621 8,462 8,428 8,361 7,949 7,946 7,841 7,704 7,482 7,398 7,284 6,908 6,801 6,464 6,416 6,301 6,271 6,260 6,182 5,688 5,662 5,639 5,584 5,452 5,201 5,034 5,032 4,728 4,643 4,594 4,485 4,432 4,144 3,943 3,937 3,814 3,735 3,236 3,093 2,601

Graphic: Ruby-Gay Martin. *Return over five years from September 1 2015 to August 31 2020, on a theoretical R10,000 investment. The results were compiled by Vestra Advisory and have been evaluated by Deloitte. The executive management of Arena Holdings have also considered certain subjective qualifying criteria, relating to the Top 100 Companies’ perceived compliance with good governance and ethical conduct. The Sunday Times Top 100 Companies in 2020 includes 93 companies. Due to market conditions, including the impact of the Covid-19 pandemic, fewer listed companies met the required criteria for inclusion.

www.exxaro.com

Responding to the needs of deprived communities

Society is looking to the corporate sector to deliver more, says DRDGold CEO

By LYNETTE DICEY

● Investors globally have turned to gold and goldstocks amidthe uncertaintyof aglobal pandemic, helpingmining companyDRDGold into the top spot.

DRDGold’score business is the extraction of gold from tailings and sand recovered frommine dumpssituatedacross theeastern, central and western Witwatersrand.

CEO NiëlPretorius attributesDRDGold’s healthy performance to the setup of the business: “Surface-based, tightly staffed and substantially automated,we werewell positioned.”The recipefor the company’s success, he says, is a strategy that best serves the size and quality of its reserve and resource base;a board,executive andworkforce ofpeople withproven skillsand experience; being in the “right”country; and, morethanever,having therightproduct— gold.

Critically, too,the companyhas demonstrateditstenacity andbuiltiscredibility over time —and learnt from its mistakes.

“Theoutlook forDRDGoldis betterthan ever,”saysPretorius. “Conventional mining is harder these days, and we exited this at the right time.We would nothave beenable to now start to build the surface retreatment business wehave —the capitalrequired just isn’t available.”

For thefuture, the company hasaccess to all the resources needed for the next planned growth phase, he says.

In addition,a proventrack recordin responsiblesurface treatmentingold withthe prospect of expanding onthis with regard to platinumgroup metals(PGMs) andother mineralsisadecided benefit,asisthetechnical ability to mine thewhole of its current reserve and resource.

The company has establisheda good rep-

The company has a good reputation as a dividend payer and a sound cash position.

utation amonginvestors asadividendpayer, while agood cash positionis theresult of strong cash flows and no debt.

The companyincreased goldproduction year on year by 9% in the financial year to June30 2020,in spiteofthe lockdown.Operating profit was 320% higher at R1.56bn, reflecting the increase ingold produced and sold anda 33% increasein theaverage rand gold price received.

DRDGold declared a finaldividend of 35c a share,making atotal distributionfor the

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100 COMPANIES

September 2015: R10,000 August 2020: R175,651

The state simply does not have the capacity to deliver on its own

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year of 85c a share.

This was the 13th consecutive year of dividend payments by the company.

Despite this positive outlook, DRDGold facesmany ofthesame challengesencounteredbymostbusinesses inSA.Theseinclude containing the threat of growing social unrestarising frompoverty.“Much ofour core business takes placein and around densely populatedurban communities, manyof whicharecharacterised bysocial deprivation,”points out Pretorius. The company hasresponded byestablishing and maintaining socially relevant programmes.

Its Broad Based Livelihoods Programme, forexample,is helpingthousandsofpeople —through training andmentoring and the supply of materials and equipment—to use land availableto them togrow foodand to earn an income by selling produce.

DRDGold’s second challengeis managing therisinglevelof crime. The companycontinues to engage withthe government at ministeriallevel throughMinerals Council SA, and directly with the police, and by making improvementsto itsownsecurity,applying new technologies and upskilling security personnel.

The third challenge is power —its quality, quantityand reliability.“While wecontinue to support the view that Eskom cannot be allowed tofail, wealso supportthe development of independent power production, which needsto be moreaggressively facilitated by government,”says Pretorius.

The company has alevel of backup energy supply for emergencies and an arrangement for Eskom to give it advance warning of disruptions.

As thelocal economywasunderduress evenprior toCovid-19, Pretoriusexpects largersocial obligationsand supplierrisks. “It’s pointless to say that social delivery is a government responsibility; the state simply does nothave thecapacity todeliver onits own. Society is thereforelooking to the corporate sector to deliver more.

“Foritspart,the corporatesectorhastwo choices: to givemore or have ittaken. The priorities needto be improving thequality of education and stimulating the informal economy to provide more jobs —in effect, making the informal economy formal.”

One ofthe effects of theCovid-19 crisis hasbeen areversal inthe trendtowards globalisation,Pretorius pointsout.“Countries with established economies have becomemore introspectiveandprotectionist. Forus,thiscould meangreaterchallengesin sourcing consumables for our processes.”

Loyal to the country, for better or worse

SA’s woes are Harmony’s; they are joined at the hip, says the miner’s CEO

By ANGELIQUE ARDÉ

● InDecember 2015,just beforePeter Steenkamp startedhis tenureas CEOof Harmony Gold in January 2016, Harmony’s market cap was about R5bn and it had R2.5bn in debt.By theend ofJune2020, themarket cap hadgrown to R43.3bn.Netdebtthis year fell to R1.36bn.

SA’slargest goldproducerhas grown its share pricetenfold over the pastfive years. And Harmony was included in the FTSE-JSE Africa top 40 index in September.

It’sasuccessstory anyCEOwouldtake delight in telling.

ButSteenkamp playsit down.“People love our story,”he says.“As amajor gold player inSA, we’re the only onewith full exposure to the rand-per-kilogram gold price.”

Thestory, hesays,is oneofa clearand well-understood strategy togrow the asset portfolio. More specifically,it’s that after Steenkamp rejoinedHarmony in2016, the company started its growth strategyby lookingat assetsin SA,elsewherein Africaand Papua New Guinea.

The aimwas specificallyto enhancethe grade ofthe asset portfolio.The aimwas for higher-grade, longer-lifegold assets.At the time, Harmonytargeted theSAassets of AngloGold Ashanti, as itsremaining SA assets were a natural fit to those of Harmony.

First,Harmonybought MoabKhotsong,a mine in North West, in 2018; then it bought Mponeng and MineWaste Solutions from AngloGold Ashanti.The dealwas concluded at the end of September this year. The $200m capital raise forthe funding of the latter transactionwas 4.75timesoversubscribed, a sign of strong investor confidence.

Moab Khotsong addedabout 230,000 gold ounces, and the recently acquired assetswillincrease productionbyabout 350,000 ounces, improving thecompany’s profit margins.

Anothernotable transactionwas thepur-

chasing of jointventure partner Newcrest’s 50% interest in HiddenValley, in Papua New Guinea, in2016. “Wehad torecapitalise that. Ithasbeen agoodminefor thepastfew years,”Steenkamp says.

Today, hesays, the companyis stronger thanever,boasting better-qualityassetsand “joined at the hip”to SA:“SA’swoes are our woes.”

Thismeans anunstable andincreasingly costly power supply,among other things. Electricity now accounts for16% of Harmony’stotal costs.“We’re probablyEskom’s biggest customer, or payingcustomer.The bigworry wehaveis above-inflationescalation in price. We’ve done an enormous amount ofwork tocut consumptionto bare

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needs.”Steenkamp saysthe company has identified independent power producing and renewable energyopportunities to derisk pricing,with a solargeneration project that willgenerate about30MW inthe Free State now under way.

Hesays thebuildingofthe solarproject will commenceas soonas finalregulatory approvals arereceived. “Wewill alwaysbe very dependenton Eskom butwill probably be able to generate around 10% of our consumption.”

Mininghasneverhadit asgoodasithas under mineralresources ministerGwede Mantashe, Steenkamp says.

“Hereallyunderstands ourbusinessand what weshould be doing. He’sbeen very helpful, especially during the Covid-19 crisis. After 21 days of the lockdown in SA being an-

nounced,we wereallowed tooperate at50% capacity. If it wasn’t for his leadershipwe probably wouldn’t have beenable to get back to business.”

Headmits thatHarmony’s successover the past yearis owing to acombination of

factors spurred by an exceptional gold price rally.

“At the current gold price levels, it’slikely that wewill repay ourdebt quicklyandbein aposition to pay dividends in the not-too-distant future,”he says.

In the company’s latest annual report,chairPatrice Motsepe says the companyremains positive about the outlook for gold in the prevailing uncertain and volatile macro-environment.

“We believethis risingtrend will continue,”he says.

What isit thatmakes Harmonya good stock? Financialdirector BoipeloLekubo says itpresents investorswith anatural hedge. “Whenthe rand goldprice increases, our margins open up and you see a run in our share price,”she says.

The reimagining of mining

There is a firm focus on making a contribution to the livelihoods of host communities

By LYNETTE DICEY

● KumbaIron Ore,asubsidiary ofAnglo American, has continued to deliver a solid mining performance in thefirst half of the year despite extremely challenging conditions, demonstrating notonly its resilience but also its ability toadapt to operating underthe newregulationsrequired bythe Covid-19 pandemic.

At atime when manycompanies have had to suspend dividend payments, Kumba declared an interim dividend of R19.60a share. Atthe same timethecompany has kept afirm focuson contributingto the livelihoodsofits hostcommunitiesthrough R1.4bn ofprocurement spendandR126mof social developmentprojects, ofwhich R56m relates toits comprehensiveefforts tosafeguard lives and livelihoodsamidthe Covid19 pandemic.

Kumba CEO Themba Mkhwanazi says the company is deeplycommitted to creating value for all its stakeholders.

“No-one could ever have imagined the extent to which thispandemic would reveal so manyofourvulnerabilities asanation. Our people have led from the front, ensuring we havearesilientbusiness withsafeandresponsible production.”

Inthefirsthalf oftheyearKumba contributedmore thanR5bn inincome taxand royalties, returned R8.3bnto shareholders — includingover R2bnto itsempowerment partners —and paid R2.4bninsalaries and benefits to employees.

At thesame timeit hasbeen supporting small businesses through its Zimele enter-

prisedevelopment programme,whichoffers paymentholidays andaccesstoa rangeof business support mechanisms.

Its strong earnings before interest, tax, depreciation and amortisationinthe first half of the yearof R17.4bn at amargin of 55% translatedinto R7.1bnof attributablefree cash flow.

Continual improvementis thegoal at Kumba, which reported a 13% increase in export salesto 10.9Mt (Q32019: 9.7Mt)and an increase of 35% relative to Q2 2020.

The company’s margin,saysMkhwanazi, continued to benefit from constructive market prices and currency weakness, as well as early anddecisive actiontaken toprotect its margin through additional cash preservation measures, including R700min cost savings for the year to date.

The company has implemented an extensive livesand livelihoodsprogramme, called WeCare. It includesscreening and testing, workforce education and communication, mental healthsupport, contingencyplans to ensure social distancing at work and to allow for periodsof self-isolation,as wellas remote working.

Mkhwanazisays: “Managing through the pandemicalso requiredcollaboration with the provincial heath department and localmunicipalities. Itis providingessential

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servicessuchas health care and medical services tolocal communities.We collaborated with Transnet as it reopened andrampedupoperations …we supplied PPEs and a fully equipped laboratoryto it.”

Kumba Iron Ore TOP 100 COMPANIES K

September 2015: R10,000 August 2020: R87,020

Covid-19 challenges comeon top oftraditional challenges,including market volatilityand costinflation. Theformer isbeingmitigated bya strong and flexiblebalance sheet. The latteris partlymitigated bycostsavings programmes, which have delivered R2.6bn to date since the start of 2018.

Graphic: Ruby-Gay Martin

Kumbahasbeen fatality-free for four years,aresultofits focusonthesafetyand health ofemployees andcontractors. Mkhwanazi says:“Losing colleagues to Covid-19 has been tough for everyone, and we’re doing everything possible to safeguard our workforce and our communities.”

One of the biggest challenges in ramping up production atboth its sites hasbeen how to incorporate health screening for about 8,000 people who enter its operations daily.

“Initially wewere losing aboutfour hours a day,but by applying goodindustrial engineering principles andmobile surveillance technology we’ve gotthisdownto 45minutes —with an ultimatetarget of 20 minutes,”he says.

Kumbais ontrack tomeet itsfull-year 2020 guidance,due to its relentlessfocus on improving operational efficiency.

Sustainability is a key issue. Delivering on its purposeof reimagining miningto improve people’s lives is changing the way it

mines while at the same time developing the futureof sustainable mining, says Mkhwanazi. Its trademarked FutureSmart mining approach focuses on three key areas: technology, digitalisation and sustainability.

“We could not have achieved as much as we have without the extraordinary efforts from our people, who arereally theheartof ourbusiness,” said Mkhwanazi.“Their passionand hard work have delivered an excellent outcome to date, considering the black swan eventwe are inthe midst of.I am extremely proud of our people and want toacknowledge them fortheir support and commitment.”

With ageographically diversifiedclient portfolio and its export orientation, Kumba is well positionedto navigate thecurrent environment and the longer term. It has already benefited from China’sV-shaped economic recovery dueto its robustmanagement of thepandemic andstrong economicstimulus,which supportedafavourable ironore market. Currency weaknesshas provided additional revenue support.

Buying low-cost assets as others scale back

To manage challenges, communication with all stakeholders results in joint solutions

By ANGELIQUE ARDÉ

● Buckingthe trendby investingwhen many of its peers were trying to cut costs has paid off for Gold Fields.

Production isup, costs are downand the balance sheetis strong. Theinvestment programme thecompany embarkedon three years ago seeks to ensure that its portfolio of mines continues togenerate cash sustainably into the future.

Thegold produceroperatesnine minesin Australia, Ghana, Peru and SA, as well as one project in Chile.

CEONickHolland explainstheinvestment strategy: “We invest in assets that come in at lower cost than the overall portfolio. So it’s defensive in the face of lower prices, if they continue.

“Butifgold pricesarehigh,as theyareat themoment,weshould beinastrongposition to be more leveraged to those increases.

“Inaddition, webelieve theindustry hasn’t beeninvesting enoughin exploration andexpansion overthepast20 yearstosustain itself,”he says.

As partof theprogramme, thecompany spent morethan $1bnbuying andinvesting in a number of projects and in funding exploration at its existing mines.

For one,it boughtinto andsubsequently built a new mine in Gruyere, Australia.

Holland saysGruyere has come inat a costof about20% lowerthan existingassets andhas alongerlife,with significantupside potential. “We’vealso essentiallybuiltanew mineat DamanginGhana,which iscoming in at very high grades and low costs.

Gold Fields

September 2015: R10,000 August 2020: R55,435

“Atthe sametime, we’vetaken aproject in Chile, SalaresNorte, all the wayfrom feasibility to construction. It will be another significant value-add for the future.

“As theprojectis inconstruction,webelievethe marketis startingtoreward usfor keeping allof it—it’sone ofthe lowest-cost operations in the gold spacefor many a year. It’s giving us a lot of kudos in the market.”

Holland says Gold Fieldshas also been goodat extendingthelifeof existingmines

over timewhile simultaneouslyfocusing on environmental,social andgovernance(ESG) considerations.

Having decided10 yearsago tocreate an executive role to manage sustainability, Hollandsays ithas takenthecompany thislong to comprehensivelyembed andintegrate ESG. But doing so has woninvestor support.

Reflecting on the company’s success, Hollandsays thereis nosilver bullet.“It’s avery clear, articulated strategy we’ve been followingoveranumberof yearsandIthinkwe’re starting tosee theexecution ofthe strategy being appropriately rewarded.

“Thecompany ispositionedin thelower halfof thecostcurve,with over20-million ounces inreserves acrossourinternational operations,whichplacesus inthetopsixin the gold universe globally,”he says.

It’sgreat whenall yourmines aremaking money, he says, including the formerly troubled South Deepin SA, which isstarting to “hit the numbers”.

Thechallenges facingthe companyinclude the volatile goldprice, exchange rates, the oil price, the cost and availability of input

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THERE’S NOTHING LIKE WATCHING THE SUN RISE OVER A ‘SUNSET’

INDUSTRY.

How do you begin to change an industry?

The same way you change anything. You work hard. You do your homework. You really care. Then you work even harder.

At Pan African Resources that’s what we’ve been doing for many years and it’s what we expect to be doing for the foreseeable future. Because where others saw gold mining as an industry in decline,

Not only to build a gold mining business with a bright future, but to do it while having some hard

We wanted to build strong, sustainable communities around our mines that would continue to grow and benefit long after the mine was gone. We wanted to explore cleaner renewable power generation to lighten our footprint on the earth. We wanted to partner with other stakeholders to ensure the impact of our operations was kept to an absolute minimum, and to contribute meaningfully to social and environmental projects that shared our landscapes.

And, although some said it was impossible, we wanted to do all this while providing our investors with great returns through the cylce.

While we never rest on our laurels, this recognition, being in the top ten of the Sunday Times Top 100

We have so many great stories to tell that there is no room for here. Like how our focus on safety sits at the heart of everything we do; how innovative practices can make old assets valuable again; how blueberry farming is part of our strategy for enriching communities that we partner with; and how solar power can make mining more sustainable. But rest assured that we’ll be telling them soon.

So, watch this space. You’re going to be hearing more from us. We are Pan African Resources and we are mining for a future

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goods andservices, andchanging legislation in the countries where it operates.

To manage these challenges, Holland says GoldFieldshasa greatdealoftwo-way engagement.

“Making sure our key stakeholders —governments, trade unions and communities — understandthe risksand opportunitiesto our business iscritical, so we cancome up with joint solutions.”

Giventheunknownsat play,hesaysthe businessis structuredin accordancewith these andplanning is basedon a setof conservative economic assumptions. “For example, wewouldn’t be usinga goldprice of $1,900 an ounce. We’reusing $1,300 an ounce to work out our business plans. At that price, we want to make a guaranteed minimum margin of about 15%.”

While few, if any,businesses were prepared for the Covid-19 pandemic, how they managed the impact is key.

Holland says that in Western Australia — wherealmosthalf thegroup’s production takes place—notasingle caseofCovid-19 was recorded,and there wasno requirement to shut or curtail operations.

In Ghana,mining wasdesignated anessentialbusiness, sothere wasno needto shut operations thereeither. Though there were infections, there was a 96% recovery rate. As these countriestogetheraccountfor 80% of Gold Fields’production, the company was not hard hit.

In SAand in Peru, interruptionsto operationsweresignificant, buttheseregionsaccountfor only20% ofproduction, andinterruptions weretemporary, andfull production resumed quickly.

On the outlook forthe company, Holland saystheSalares Norteprojectisprobably “the next big event”for the company.

“We should be bringing it into production in about threeyears from now. Thatis going to add another 450,000 ounces a year, which could takeour annual2-2.5-million-ounce target quitea bit higher.And thatwill come in at half the cost base, at sub $500 an ounce, which will be a significant milestone for us.

“I thinkwe’ll alsosee furthergrowth in productionat SouthDeepaswe continueto realise the vast potential of that asset.

“I’m pretty excited. If gold prices hold up we’re poised to do even better than we’ve done overthe past year,and we’repoised to become debt-free. We usedto have over $2bnindebt,but now we could be debt-free within 18 months.

“And we’repoised topay reallygood dividends. I think we’re in good shape.”

A predictable and resilient model

Customers come first in this innovative technological enterprise

By LYNETTE DICEY

● A leadingprovider ofmobility solutions forassetmanagement, assetrecoveryand workforce optimisation,Cartrack continues to deliver solid results.

The software technology company, which commenced operations in SAin 2004 and listed inDecember 2014,operatesin 23 countries on five continents. It delivered stronggrowth insubscribers,subscription revenue andoperating profitin theyear to end-February.

Thefirst quarterofthe company’s financial year 2021 —ending inMay2020—was thequartermost affectedbytheCovid-19 pandemic as a resultof the hard lockdown imposedon anumber ofthe territoriesin which the company operates, says group CEO ZakCalisto. However,it appearseven a global pandemichas not lessenedinterest in its software, and the business has proved its resilience.

In October thecompany again reported robust year-on-year subscriber growth of 13%anda21% increasein headline earnings pershare inits half-yearresults. Totalrevenue rose 16% and operating profit increased by 16% to R368m—up from R316m.These strong results were achieved despite the limited capacity, due to Covid-19 restrictions, to install the in-vehicle Internetof Things (IoT) technology the company specialises in.

“Thisreportingperiod wasmateriallyaffectedbyasubstantial numberofourcustomers facingcash-flow andoperational difficultiesdue tothesevere globallockdowns and travel restrictions,”says Calisto. “We stood byour customers andhave afforded them all reasonable assistance where possible.”And despitethedifficulties, therewas strongdemandfor thegroup’s Software-asa-Service(SaaS) telematicsplatform,which deliversessential, real-timedata,visibility and impact for fleet operators.

Group CEO Zak Calisto.

Thepast fewmonthshavebeen some of Cartrack’s bestyet interms ofnew subscribers, primarily frommedium and large fleet managers and owners, says Calisto.

“Our subscription-based model remains predictable and resilient.”

Itscustomers,who operateacrossindustries and geographies, continue to derive significantly improved insightsand value from its single-integrated SaaS platform, with the result that subscriber churn has not spiked.

As lockdownrestrictions havebeen eased, collections improved, andthecompany’s healthy balance sheet and prudent capital allocationremain keystrengths, says Calisto, withthe resultthat Cartrackremains highlycash-generativewith astrongcash flow forecast for the foreseeable future.

The company continues to invest significantly inresearch and development, operational efficiency and distribution.

One ofits biggest challengesin SAis that whilethe countryhassome excellentsoftware developmenttalent, thereis ascarcity of skills in this area for the company to maintain andenhance itsSaaS platform,says Calisto. Asa result,Cartrackhasinvested in growingadevelopment hubinSingapore, whichhasenabledit tosourceglobaltalent to ensure global competitiveness.

Another shortageis the availabilityof automotive technicians to fit the smart IoT devices. “The necessaryauto-electricalskills

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requiredto fitthesedevices isin short supply and we rely on our internal Cartrack Academy intake of trainees, whichwe trainforover 18 monthsto befully accreditedCartrack automotivetechnicians,”Calisto says.The companyplans to grow its mobile workshopsin SA to over 700 in the next months.

Cartrack’s success,says Calisto, is theresult ofinnovative technology and a business model and culture that combine to deliver results.

Cartrack Holdings

September 2015: R10,000 August 2020: R52,746

A founder-run business,the company’s culture promotesentrepreneurial behaviour accompanied by strongbusiness ethics. “We’regearedfor organicgrowth,”says Calisto. “We’re in full control of all the elements ofour incomestatementand balancesheet. We design anddevelop all of ourown technology and don’t outsource any parts of our business.

“Our systems are all proprietary and we avoidthird-party systemdependency. Our businessiswhatis referredtoasvertical software. We control thefull customer cycle, startingatclient acquisitionwithourown CRM [customer relationship management] platform, to the SaaS platform delivery of our core fleet management services.”

Culture,headds,is keytothecompany’s

success. Thefive pillarsof Cartrack’s cultureare customerfirst,innovation, meritocracyand transparency,centralised decision-making and loyalty.

The localmarket remains underpenetrated, with substantial potentialfor growth,Calisto says.Cartrack’s continued expansionin the marketissupported byadditional servicesprovidedthrough theSaaSplatform. Theseincludeshort-term insurance, atrading platform,an emergency safety app, “MiFleet”(a vehicle administration model designed to save costs), “Communicator”(a jobs and messaging platform toimprove fleetcustomers’service levelsandefficiencies) and“Live Vision (a real-time video solution).

Calisto saysCartrack willremainfocused on innovation forsmart mobility, actionable business intelligence and the expansion of the IoT, while benefiting from the megatrend of connectivity and digital transformation.

No lurching in a new direction

Interim CEO says the firm is reliably conservative in its planning assumptions

By ANGELIQUE ARDÉ

● Prioritisingsustainable marginsandfree cash-flow growthover scalehas been the keytodriving totalreturnstoAngloGold Ashanti’s shareholders overtime, says interim CEO Christine Ramon.

“We’ve workedhard tobalance thecapital needsfor bothsustaining productionand bringing in new ounces,”she says.

“Atits core,ourstrategyis focusedon careful capital allocationthrough the economic cycle.We produce asingle product, the price of which we don’t control, so we really do prioritise costcontrol and a flexible balance sheet —with less debt.

“We have for many years worked to diversify our portfolio, and we’re reliably conservativein ourplanningassumptions. Allthat conservatism means we’ve nothad to lurch in anew direction —ourlong-term strategy isclear, andwe’ve continuedto executeon it,”Ramon says.

“We havea uniqueadvantage —the companyand theportfolioarein goodshape;the gold price is strong, and we can focus on makingsure wegetthebest valueinthe markets while also maintaining discipline.”

Thisyearthe companyworkedtostreamline its portfoliowhilestepping up investments in assetsthathavehigh geologicalpotential. Ramon says this is already paying off.

“Sinceour 2014peakinnet debtat $3.1bn, wehave aggressivelypaid down more than50% of this throughseveral self-

help measures, taking ournet debt to $1.43bn atthe end ofJune 2020while reinstituting dividend payments.”

Allofthis hasbeenachievedwithout asking shareholders toraise equity capital, whichshe saysisa rarity,evenin thisstrong gold price environment.

“Eveninthe turbulencecreatedbythe pandemic, we’ve managedto advancethe redevelopment ofour Obuasiproject in Ghana, withminimal delayand withinour original budget. That’s no mean feat in a project ofthis size, whichwill seemore than $500m invested in redeveloping the mine thatwill tapintooneof Africa’s largest ore reserves, providingbenefit toa multitudeof stakeholders. We’reimmensely proudof this achievement.”

Ramon says thecoronavirus pandemic remainsa significantchallengeand hasoffered somevaluable lessons.“The operating environment is now more complex, with newoperating andregulatory challengesin addition to the impact on everyday life.”

Notwithstanding theseimpacts, ageographically diverseportfolio with amix of open-pit mines, underground mines and surfaceprocessinghas providedameasure

● Continued on Page 14

of protectionagainst disruptions caused by Covid-19. Thelessons learnt from the Ebola outbreak in West Africa in2014 served asa training ground, Ramon says.

The company’s responseto Covid19has alsoshownhowcapable itis, shesays. “We’ve witnessed the strength of local participation at our assets, globally we’ve collaborated more closely withgovernments and host communities,and our diverse portfoliohas supportedusduring stoppages.”

AngloGold Ashanti

September 2015: R10,000 August 2020: R47,429

Butshesays thepandemichasshown glaring gapsacross the worldin public health-care systems, andshone a light on societal inequality.

“Theminingindustry needstoensure that itworks alongside governmentand civil society to try to rectify this. This is, admittedly, a big challenge thatwill be beyond our

strength asan industryto tacklealone, but it’simportant thatwestartto addressthese systemic issues.”

AngloGoldAshanti isthe world’s thirdlargest goldproducer andthe largeston the Africancontinent, producing33-million ounces and employingmore than34,000 people. Itis listed on fourstock exchanges around theworld —theJohannesburg, New

York,Australian andGhanaexchanges —and is inthe JSE top40 index,the FTSE/JSEresponsible investment index series (of the FTSE4Good index), theresponsible miningindex and the DowJones sustainability indices (now part of S&P Global Inc) and the Bloomberg gender equality index.

Ramonsays thebusinessis inexcellentshape, anditsfundamentals are vastlyimproving. “We’vecome a long way inrecent years, simplifying our portfolio, bringingin lower-cost, longer-lifeproduction, andhavesignificantly strengthenedour balancesheet. “We’re focused on safely improving our cash flows, especially in thestrong gold price environment, and are keeping to our strategy of tight cost and capital management.

“Reinvestment in our existing assets while we develop longer-term greenfield options are expected toenhance the returns trajectory of our business,”she says.

World shortages to the rescue

Prices of palladium and rhodium in particular are high because of the effect of SA’s strict lockdown

By LYNETTE DICEY

● Anglo American Platinum, the world’s largest supplier ofplatinum group metals (PGMs),hada recordfinancialperformance in its2019 financialyear, whichenabled itto declare its first special dividend since 2001.

Thecompany hasfaced twosignificant challengesin 2020:thetemporary closureof acriticalprocessing plantforemergencyrepairs and the safe shutdown of operations to comply with Covid-19 lockdown regulations, whichmeant that,for aperiod,it couldnot produce any metal.

Despite thesedisruptions itmanaged to shut down,restart and ramp upits operations safely and has reported a strong performance in the interim period to the end of June. Benefiting from higher basket prices for its metalsand a weaker rand,the companyended theperiod withnetcash ofR11.3bn

and declared an interim dividend of R2.8bn, or R10.23 a share.

About 65% of demand forits metals is at present from the automotive industry to reduce emissions from internal combustion engines. Though theglobal automotive industrywasseverely affected by Covid-19 it hasmadea strongrecovery,almostreaching pre-pandemic levels in recent months with a goodrecoveryin China,wheremonthly sales now exceed 2019 levels.

PGMdemand isalso benefitingfrom stricter vehicle emissionstandards in crucial markets likeEurope and China,which require higher loadings of the metals in exhaust systems and have helped to keep demand at historically high levels.

Jewellery, anotherimportant market forplatinum, also suffered during the pandemic but is recovering.

Anglo American Platinum iscontinuing todevelopthe usesof PGMs—most notably in hydrogenapplications — through industry partnerships andinvestments in

● Continued on Page 15

● From Page 14

companies through its funding of venture capitalfund APVentures.Supplyof PGMsis veryconcentrated,with 70%ofminedplatinum, 80% of rhodium and 40% of palladium produced in SA. The supply was materially affected by Covid-19, says CEO Natascha Viljoen. “Our estimate at this stage is that the overallimpactgloballywill bearounda16% reduction insupply, primarily due tothe initial national lockdown in SA.

“As aresult, wehave seenstrong prices forpalladium andrhodiumin particularthis year.”

Prior to the pandemic, Anglo American Platinumwason ajourneytowardsdeveloping the mine of the future by deploying innovativetechnologies thatlower energyand water usage, create less waste, make its mines and processing operations safeand create value through the cycle.

“We’ve made significant improvements in our safety record in recent years as well as real progress with our workplace HIV and TB treatmentand awarenessprogrammes, which has led to adrastic reduction in TB incidence ratesand TB-relateddeaths atour operations,”reports Viljoen.

Another challenge is how to create longterm sustainable communities in the areas in which thecompany operates,ensuring local economies thrive beyond thelife of the miningoperations. Viljoensays:“Our effortsto build sustainable economiesbeyond mining includeinvestment inschoolsand othereducation programmesto helpdevelop skills, and supportinglocal entrepreneursthrough increased procurement from host community businesses.”

Viljoen took over as CEO in April this year from Chris Griffith, whostepped down after sevenyears inthe job.She saysthe recipefor the company’ssuccess hasbeen therestructuring andrepositioning of thebusiness over the past five years. Theoutlook for the company appears positive. In2019 it co-invested inLion BatteryTechnologies,which aimsto accelerate the developmentof next-generationlithium-air andlithium-sulphurbattery technologyusing platinumandpalladium. “We believeinternal combustionengines, battery-electric vehicles and fuel cell electric vehicles will coexistinthe market,with PGMs as acritical ingredient in allof them,” says Viljoen.

Sheaddsthat strongearningswillcontinue to bedriven by robust demandfor PGMs, combined withthe company’sfocus oninvestingin fast-paybackvalue-accretive projects, while implementing world-best-practice operations.

The only specialist Logistics Property Fund on the JSE

The home ground advantage

Sweating your own assets is low risk and brings returns sooner, says CEO

By ANGELIQUE ARDÉ

● There aren’t manygoldor platinumminers that can boast of having paid dividends consistently overthe past decadeor longer, yet AfricanRainbow Minerals(ARM) has, says CEO Mike Schmidt.

ARM isa leading miningand minerals company that minesand beneficiates iron ore,manganeseore, manganesealloys,platinum group metals (PGMs), nickel and coal. ARM also has an investment in gold through its shareholding in Harmony.

Headline earnings increased by 6% to R5.5bn for the financial year to June 30 2020, andARMpaida totaldividendofR12a share.

Schmidt saysbalancing growthand returningmoneyto shareholdersarethe company’s key drivers.

As sustainable mining depends on the replacementofore bodies,thecompanywill embark on new projects, but Schmidt says investmentwill bepredominantly inthe growth of its own assets.

“We’ll sweat our own assets, which we understand requires lowcapital intensity, is low-risk and principally brings good returns. That has been our DNA,”he says.

By exploitinggrowth opportunitieswithin one’sown minesand operations“you get earnings and value accretion earlier”. It is less risky and deliversreturns within two to three years,comparedwitha brownfield project, whichcould take morethan seven years, or agreenfield project, which can take more than 10 years to show returns, Schmidt says.

As aresult ofincreased profitabilityin the2020 financialyear, ARM reporteda returnon capital employed of 22%—the highestin the company’s history.

Schmidt puts thisdown to maturity. “Inthe miningindustry, when you invest capital it sometimes takes manyyears ofinvestment torealise that return.

“We’re at a stage where a number of our operations have matured. Iron

ore is atsteady-state production, manganese is ramping up promisingly and PGMs [at Two Rivers andModikwa] arealso increasing production.”

In addition,the company hasexited some ofits loss-makingoperations.“So we’ve rationalisedand stoppedinvesting wherereturns weremarginal, andwe’ve continuedto invest incurrent operations.”

One ofthe maindrivers ofARM’s success overthe pastyear wasthediversity ofits portfolio. Higher US dollar prices for iron ore, platinum, palladium, rhodium and nickel more than offset the decline in manganese ore,manganese alloyand thermalcoal prices. The 11% weakening of the rand versus the dollaralso contributedtoheadlineearnings.

The Covid-19 pandemichas sent investors flocking to gold as a safe-haven investment,and atthe sametime demandfor PGMs hasincreased inline withstricter vehicle emissions control.

“Being a diversified playerwe perform well throughthe cycle,because whenpreciousmetalsare down,generallybaseand ferrous metalsare up, andvice versa,” Schmidt says.

He describes ARM as a balanced company

that maintains healthymargins and consistently delivers valueto shareholders and support to stakeholders.

An uncertain economic outlook, both locally and globally,above-inflation cost escalationsand thefinancialimpact ofCovid-19 arethe topchallengesfacingARM. Otherbig challenges include consistencyand security of water supply atthe Northern Cape operations, therising costof energy,climate change and a continuing effort to reduce carbon emissions.

Schmidt says a strongcash position has enabled ARM to navigate a multitude of challenges while continuing to invest in the business andpay dividends.“It alsogives usflexibilityto pursuevalue-enhancinggrowth opportunitiesaligned toour strategy.”He says the pandemic has had pronounced health,economicand societalimpacts,the extentofwhichis stillunfolding.“Our responseis tocontinueprioritising thehealth, safety and wellbeing of our employees and to ensure the business’s sustainability.”

Again, astrong cashposition isholding thecompany ingood stead,and thesuccess of thecompany and itsability tocreate value isinextricably linkedto thevalue thatARM creates for others, Schmidt says.

To measure thisvalue, the company benchmarks againstitself and peers,to ensure it is constantly improving.

“We dosurveys in theareas inwhich we operate, looking at how we are valued by our people,our communities,provincialauthorities, and so forth.

“Do they respect,recognise and acknowledge what we’re doing? In that balance, if we don’treturnmoney toshareholders,we’re not successful.If we don’tcontinuously improve operational performance, we can’t sustain margins and profitability.”

At the same time, the company must ensure it has asafe and healthy workforce thatis appropriately skilled, he says. Toachieve that,skills development and capacity building are crucial.

Also criticalto thesuccess ofthe company isresponsible stewardshipof naturalresources. “Abig issuewe’re driving, in alignment with legislation, is how to concurrently rehabilitate and improve the environmentrather than wait for the closure of the mine.

“So we’respending moneyon improving the quality of air, water, soil and vegetation. It’s about balance.”

‘We

are mining for a future’

The aim is to balance financial and business goals with human ones

By LYNETTE DICEY

● Qualityassets, afocus ondelivery anda track record ofsuccessful project execution have positioned PanAfrican Resources, a mid-tier African miner with a production capacity ofup to 200,000ounces ofgold a year, as one of SA’s high-margin gold miners.

The company’s assets include the BarbertonMines complex,oneofthe oldestand richest workinggold mines globally,as well as modern,highly automated tailings retreatment plants, theflagship being Elikhulu, (“TheBig One”in Zulu) atEvander Gold Mine. Pan African Resources owns and operates aportfolio of high-quality,low-cost operations and projectsin SA.

Its gold production is evenly weighted between surface andunderground operations, providing a diversified portfolio with production agilityand flexibility. Itsassets also have significant organic growth and valueappreciation potential.

The companyrecently announcedanotherstrong setofyear-endresults despitethe Covid-19lockdown, whichit estimatescost it about R300m in lost revenue.

Thegroup significantlyreduced itsnet debt by more than41% and generated aftertaxprofitand headlineearningsof$44.3m and $44.2m respectively overthe year to June 30.While earningsfor themost recent reporting period wereadversely affected by the pandemicand lockdown,thisimpact was largely offset by the increase in the price of gold and thegroup’s ability to ramp upgold productionwhen lockdown restrictions ended.

Conceding that the rise in the gold price was fortuitous and that it certainly bolstered the company’s performance,Pan AfricanResources CEO CobusLoots says increased and safe production —well above earlier revised estimates — was the real achievement.

At a time when many businesses haverestricted furthercapitalprojects,PanAfrican Resourcesisone ofthefew groupsforgingahead

with local investments, which include development of its brownfield, low-cost Egoli projectat EvanderMines.The project’s payback timeisestimatedtobe atlessthanfiveyears from thebeginning ofconstruction,according toan independent feasibility study.

Thegroup recentlyannounced thediscovery of a high-grade zone of gold mineralisationat itsNewConsort undergroundmine nearBarberton, asaresultof itscontinuing exploration activities.

Other investments related to environmental, social and governance (ESG) issues include a 10MW renewable energy solar photovoltaic plant atElikhulu, which will further reduceproduction costs, as wellas a large-scale agriculture project at Barberton Mines to createemployment opportunities for local communities.

There isgrowing acknowledgementof the importance of ESG issues both from mining companies and investors.

The PwC “SA Mine2020”report identifiesfour keyESGareas thatshouldbe topof mind for any company:supply chain re-

silience, measuringimpact, climate-related risks and resource efficiency.

Luyanda Mngadi, “SA Mine2020”project leader, says that while mining companies are often at the forefront of ESG efforts they are weakontheirreporting whenitcomesto setting targets and measuring themselves.

Loots says ESGis a big focusarea for Pan African Resources,as it is formost mining companies, but agrees that the industry needsto articulateitsachievements inthis area to betterdemonstrate its sustainability to investors.

“We’re doing our best to go beyond the required regulation to make our business more sustainable,”he says.

“Mining is sometimes still perceived as an archaicindustry, whichis notthe case.At Pan African, we are ‘Mining for a Future’.”

The companyvery quicklyput protocols and procedures inplace to deal withthe regulationsrequiredasa resultoftheCovid-19 pandemic,which alloweditto keepoperating. Lootspoints out that themining industry is geared towards dealing with communicablediseasesandhas ahistoryoftreating health and safety as top priorities.

The company’s success, he maintains, is a combinationofquality assets,acommitted team ofpeople,aculture ofaccountability, and agility.“We’re not atraditional mining house,butrathera groupofpeopleunited arounda commonpurposeand values,balancing financialand businessgoalswithhuman goals,”he says.

“Efficiencies willnever beat thecost of communities orthe environment.And while we strivefor profits and returnsto shareholders, thiswill never compromiseon the safety of our people.”

Thecompany recentlyrevealed itsnew logo. It featuresahoney badger—chosen, says Loots, because of its resilience and its hard-working and aggressive character despiteits relativelysmall stature, which personifiesthe company’s panAfrican characterwhilealso giving a nod to its forward-focused approach. Loots is optimistic about the future for thecompany:it plans tobe debt-free bythe endofthe 2021year.And, witha unique valueproposition thatincludes surface re-mining with underground operations, long-lifeassets, ahighly cash-generative business and near-term growth potential, it is well positioned for the years ahead.

Special metals for a greenerworld

The growth strategy the company began in the last market down cycle is delivering, says CEO

By ANGELIQUE ARDÉ

● Thepast yearhasbeena recordonefor NorthamPlatinum. Thecompanyachieved record sales revenue,operating profit and earnings before interest,taxes, depreciation and amortisation.

These outcomes wereachieved despite production stoppages resulting from the Covid-19 lockdown.

“Wecontinuedto deliveronourstrategy of developinglow-cost, long-lifeassets which are positioning thecompany for furtherstrong financialperformance,as wellas de-risking ouroperations againstpotentially subdued orvolatile commoditymarkets,” says chief financial officer Alet Coetzee.

Akeyelementof itsstrategyisthereturn to shareholders of valuecreated through the execution of the company’s growth projects. “The successof ourgrowth programmeto datehas allowedusto purchaseapproximately 70% of Zambezi Platinum preference shares, which represents a real value return of R9.1bn,”Coetzee says.

CEO Paul Dunne says it’s gratifying to see how thegrowth strategythe companyembarked onduring the market downcycle five years ago is delivering.

Coetzee says the execution of this strategy andNortham’s robust finances have affordedthe companyoperational flexibility.In responseto Covid-19,it moved fast to minimise, as far as possible, theimpact ofthe pandemicon operations and employees.

“Socially, the healthand wellbeing of ouremployees andhost communities were keyconcerns. Economically, we sell ourproducts intoa globalmarket. Thatmarket wassubject tometal price and demanduncertainty, which had the potential to affect our liquidity.

“In addition, the national lockdown and the subsequentphased restart ofour operations negatively affectedproduction volumes.Thisflowed throughtounitcosts, profitabilityand ultimatelyour cashposition. Strictcash preservationtosupport the long-termfuture ofthe companywas apriority. Actionstakenincludeda short-term pullback on noncritical capital expenditure, restructuring ofthe company’s domestic medium-termnote programmeand ensuring we had sufficient banking facilities.”

Coetzee says the companyis now financiallywellpositioned towithstandnegative impacts. “Now and for the future, our greatest defenceagainst challengingeconomic times is safe, cost-effective production, and achieving this consistently.”

Covid-19remains achallengethat can affect the business in many ways, Coetzee says. These include thehealth and wellness of employees, the ability to produce, the demand for, andprice of, metals,andthe currency exchange rates.

Unreliable energy supply is a concern and therefore the company’s expansion strategy focusesonenergy efficiencyandsupply management, she says.

The companyfocuses onwhatit cancontrol, alsowithregard tothesafetyandhealth ofemployees, communitydevelopmentand upliftment programmes in the areas in whichitoperates. “We monitor and maintain compliance with all relevant legislation [in thisregard], and this ensuresthat we maintain our social licence to operate.

“In addition, effective cost control, sus-

tainingour positionwithinthelower halfof thesector costcurve, while maintaining strong relations with our longstanding customer base—which viewsus asa consistent and reliablesupplier of qualityproduct — provides a buffer to economic downturn.”

Lookingtothe future,Coetzeesaysthe metals Northam produces are special and aid theattainment ofacleaner, greenerworld. “It isour considered opinion thatnet demandfor platinumgroupmetals willremain strong overthe coming decade.This will support pricing.

“Our current growth projects are well progressed and significantlyde-risked. Our balance sheet is strong and it will continue to strengthenon thebackof growingproduction and improved margins,”she says.

“We have alreadymade significant progress in returning meaningful value to ourshareholders. Thisis akey strategicimperativeandwewill continuetohonourit. So Ibelieve thatthe outlookfor Northamis extremely positive.”

LeadingSAasset managerCoronationis alsobacking platinumto deliverfuture growth potential.

“We expectplatinum tooffer growthpotential asit islikely tobe subjectto anongoingsupplydeficit, whichwillunderpinthe precious metal’s valuation,”says NeilPadoa, theheadof global developed markets at Coronation, writing for Allan Gray’s Offshore Exchange. Overthe pastfive years,Northam has invested overR12.9bnin the pursuitofits growthstrategy,doubling productionand creating5,897 new, direct jobs.

BetweenJuly2019 andJunethis year,the company’sshare priceincreased by 104%.

Over thepast fiveyearsNortham has hada compoundannual growth rate of 33.5%.

Business Leader of the Year

Wisdom honed by past crises

Leaders need to realise the extraordinary role they play in modelling values, says Nedbank CEO Mike Brown

By ANGELIQUE ARDÉ

● To be named BusinessLeader of the Year by one’s peers is a great honour, but perhaps more soin ayear ofsuch volatilityand turmoil as 2020.

Nedbank CEO MikeBrown says financial outcomesandprofitability havethisyear been secondaryto the focus onthe health and safety of staff,helping clients through the most difficult financial times they’re likely to face in their lives, and working with industry bodiesand regulatorsto ensurethe financial sector remainedresilient in the greatesteconomic downturnthat hasoccurred since World War 2.

“Thisis anenvironment thatcertainly stretches one as a leader,”he says.

“In manyways I’ve been fortunateto have experiencedworkingthrough theAsianfinancial crisis in1997/1998, the so-called small bankcrisis in2001/2002, theglobal financial crisisin 2008/2009and theAbil crisis in 2014/2015. It enablesonetolook around corners in times of crises, understand early on what’s likelytocomeinyour direction, and to react fast.”

At thetime of hisappointment, Brown was the youngestCEO of a bigbank in SA, and heisnowthe longest-servingCEO of any of the big banks in the country.

Brown (54)comes from afamily of bankers.His paternalgrandfather, hisfather andapaternaluncle allworkedforStandard Bank. But he says he ended up in banking more by chance than by design.

After qualifying as a chartered accountant in 1988, he completedhis articles at Deloitte &ToucheinDurban, wherebychancehe wasplaced inanauditgroup specialisingin financial servicesand ofwhich the Natal Building Society (NBS) was a major client.

He wasafterwards employedbyDeloitte &Toucheinthe US,worked in London and

then returned to Durban.

HeleftDeloitteto joinNBS,whereheled themerger ofNBSCorporatewith the commercialindustrial lendingdivision ofBoE Private Bank. He becamedeputy MDof BoE Corporate and then MD.

After the merger of BoE and Nedbank in 2002/2003, he was appointed MD of Property&AssetFinance. In June 2004, he became chief financial officer of Nedbank Group.

InMarch 2010,heassumedthe roleof CEO ofNedbank GroupLtd and Nedbank Ltd.

About acareer inbanking, Brownsays: “The breadth of canvas and intellectual stimulation ina bankingenvironment isalmost unrivalled byany industry.”He sayshe’s proud of the work hehas done around the centralityof cultureandvaluesin anorganisation andtheplacing ofafocusonpurpose andlong-termsustainability. Healsoused his positions as chairof the Banking Association SA and deputy chair of Business Leadership SA to promote this work.

Concerning his leadershipstyle, Brown sayshe believesin leadingby example,and triesto bethebest-preparedperson inthe room. “I workhard at that. I alsotry to balanceintellectual andemotionalleadership, and togive people freedomwithin boundaries.”He saysagreatleader shouldbedrivenby outcomesforthe organisationthey’re leading as opposed totheir personal outcomes. “Underneaththat, it’simportant for leaderstohavehumility andrealisetheextraordinary rolethey playin modellingthe values andtherefore cultureof theorganisa-

tion theylead.”Among thebusiness leaders hemost admiresareformer bossesTom Boardman and ReuelKhoza andcurrent Nedbank chair Vassi Naidoo, people from whom he has learnt much.

Hesays themain challengein hiscurrent rolestemsfrom Nedbankbeingapredominantly SouthAfrican business ina difficult macro-economic environment.

“The performanceof banksis closelycorrelated tothe economicperformance ofthe countries in which they operate. The biggest challenge sitswith SA Inc andour seeming inability to operationalisestructural reform toget bettereconomicgrowthand toreduce unemployment.

“It’sextraordinarilydifficult overlongperiods oftime to runa successfulbusiness in an unsuccessful society,”he says.

Brown is by no means pessimistic about SA and speaks highly of our leaders.

“Every country has somerotten eggs, but South African businessleaders can hold their headsup anywhere inthe world—particularly in the emerging markets.

“The businessleaders andmanagement teams of South Africancompanies have always been at the top of the emerging-market pile. We’ve hada numberof scandalswhich dented that image andthe perpetrators need to be broughtto book, but Ibelieve those are isolated cases rather than systemic.

“Froma businesspointofview, IknowI can beoverly focusedon detail.I reallywant to makesure I understandeverything and thatmeans Igettooengaged inthedetail. But I’ve watchedsomereally goodexecutiveswho aren’tengagedenoughin thedetail get tripped up by that,”he says.

Heregards marryinghiswife, Sandra,as his biggest achievement in life. “She’s been amazingly supportive of mycareer. She was a theatre sisterwho chose to lookafter our children and support my career, so I’ve been hugely grateful for that.”

Tenyears fromnow, Brownsays hesees himself doing something entrepreneurial in the privateequity space,combined with holding a fewnonexecutive positions.“Most SouthAfricansretireat 60,whichisfartoo young, especiallywhen youhave ahuge amount to contribute,”he says.

But playing better golf, going into the bushandtravelling withfamilyandfriends are all definitely on the cards.

Lifetime Achiever Promoting the success of others

Encouraging bosses

shaped Jacko Maree’s management style, and he is proud of the young people he has helped

By ANGELIQUE ARDÉ

● Tenacious, unflinching,courageous. An excellent mediator. A visionarywith a fearless dedication tonurturing black talent. ThisishowJacko Mareeisdescribedina 2013 specialedition ofPinnacle magazine, published by the Associationof Black Securities and Investment Professionals, in honour ofhis contributionto transformationin the financial services sector.

Maree was one of the principal architects ofthe financialsectorcharterin 2004,a transformationpolicy topromotebroadbased BEE.

“Soon after I becameCEO [of Standard Bank Group]in 1999, a lotwas happening around BEE in the mining sector, with speculation about changes to mining rights.

“A few of us felt we had to get on the front foot and commit to what we were going to do topromoteBEEin thefinancialservicessector. Thatculminatedin thecharter.Iledthe sector —thebanks, insurance companies, pension funds, unit trust companies —to negotiate and signit.

“Itwas abig achievement,but itwould not have happened withoutthe support and guidanceof mychair,DerekCooper, andSakiMacozoma,whowas onourboard.They were deeplycommitted totransformation, and wise,”he says.

Reflecting on his 40-yearcareer as a banker, Mareesays histhree bossesat Standard MerchantBank —EddieTheron, Div Geeringh and Pieter Prinsloo—all had a powerful influence on his life.

“Mostpeopleget squashedbytheirbosses, but I was encouraged and promoted by mine.They werealways justtryingto getme

tosucceed. Andtheypushedme aheadof themselves.”Mareesays thiskindofleadership shapedhis own, which wasinclined towards developing young people.

Thefactthat StandardBankboaststhe mosttransformedtop managementteamof allthemajorbanks isnoaccident.“Sim Tshabalala [Standard Bank Group CEO] has assembled anincredible team. Ihad arole to playin thecareers ofmost ofthem, andI’m proud of that.

“There’s been a long list of alumni from thebank who’vedone reallywell inother fields,and ithasgivenme greatpleasureto have played a part in their development. Seeingyoungpeoplesucceed hasbeenagreat thrill for me,”he says.

Mareesays oneof themost powerfulinfluences onhis life was StAndrew’s College in Makhanda (formerly Grahamstown), where he wentto schooluntil1973,whenhe went to Stellenbosch University.

After obtaininga BSc(cumlaude) degree in1976 hestudied atOxfordUniversity asa Rhodes Scholar. He graduated in 1980 with a first classMAdegree inpolitics, philosophy and economics.

Maree’s careerat StandardBank started in 1980,when hejoined thecorporate finance department of Standard Merchant Bank (SMB). He was appointed MD of SMB in 1991, and MD of thenewlyformedStandard Corporate & Merchant Bank in 1995.

He became CEO of the Standard Bank Groupatthe heightofoneof themostseriouschallenges thebankhadever faced—a hostile takeover bid by Nedbank.

Successfully defendingthe bid wasa career highlight.

“It wasthe biggesthostile bidin SA’s history —a nine-month battle. Nedbank was the darling of the banking industry and Old Mutual was its biggest shareholder. It was a formidable combination.Everyone assumed they were going to win. Standard Bank was a muchlargerbank withabiggercustomer base and stronger brand name, but it had lost its waya little. IfNedbank had gotit, it would’ve been a complete steal.

“We fought for what was right and won. It galvanised the organisation, andfor three or four years everyone was united.

“It’s not often that a CEO has the entire organisation supportingthe leadershipteam. Myles Ruck, Ben Kruger, Peter WhartonHood and I appointed a lot of young people, like Tshabalala, and gave them huge portfolios, and the organisation flew from there.”

Another career high —and perhaps his most significant achievement —was overseeing the strategic partnership between StandardBankand theIndustrialandCommercialBank ofChina (ICBC)in2007. Atthe time the$5.5bn, 20% equityinvestment in StandardBank wasthelargest foreign direct investment ever made inthe country.

The deal, which was concluded in 120 days,still livestoday,withtwo ICBCmembers on the bank’s board.

InMarch 2013,Mareestepped downas group CEOofStandard Bankaftermorethan 13 yearsat the helmof Africa’slargest bank, which operatesin 20countries onthe continent.Under hisleadershipthe bank’s share priceincreased fromR21 toR118, thedividend per share wasup almost seven times, and the group’s market capitalisation grew from R30bnto R190bn.

Maree, who is 65, is nonexecutive deputy chair of StandardBank,nonexecutive chair of LibertyHoldings anda nonexecutive board memberof PhembaniGroup. Healso serves as one of President Cyril Ramaphosa’s investment envoys.

He has received numerous peer accolades and awards.

In 2004 he received the Wits Business SchoolAnnual ManagementExcellence award.In 2005hewasnamed TheSunday Times BusinessLeader ofthe Year.In 2005 and 2006he wasvoted Moneyweb’sCEO of the Year.

In 2007, 2008and2009he wasvotedthe mosttrusted CEOin SAbyAsk Africa’s annual Trust Barometer study.

Honorary Award

A steadfastly honest path

The man who led the Covid advisory body from March became popular and trusted

By LYNETTE DICEY

● Leaders have an opportunity to provide their people with a sense of security,and to connect, motivate and inspire them. This yearthe SundayTimesTop 100Companies salutes professor Salim Abdool Karimwith an honorary awardfor providing guidance and inspirationto the nationthroughout the Covid-19 pandemic. The acknowledgement is inrecognition ofhis dedication, commitment and courage.

The pandemic placedthe clinicalinfectiousdiseases epidemiologistsquarely inthe public eye. Appointed in mid-March to lead the Ministerial Advisory Committee (MAC) advising the government on combating Covid-19, he hasbecomeafamiliar facein recent monthsduring livetelevised public briefingsdelivered inhischaracteristically calm and measured manner.

Hisability totranslate complexscience intoeasily understandablelanguageresonated witha nationin ahigh stateof anxiety in the early days of the lockdown, and he quickly became a popularand, even more importantly,a trusted and credible figure.

Abdool Karimis nostranger topublic platforms or high-profile positions. He is a director ofthe Centrefor theAids ProgrammeofResearch inSA(Caprisa) and Caprisa professor ofglobal health at Columbia University, New York.

Inaddition, heis anadjunct professorof immunologyandinfectious diseasesatHarvard University, an adjunct professor of medicine atCornell University andpro vicechancellor (research)at theUniversity of KwaZulu-Natal.

Hehaspreviously servedaspresidentof the SA Medical Research Council.

He first came to the public’sattention two decades ago,when hewas oneof themost prominent scientists tospeak out against Aids denialist Thabo Mbeki,then SA’s president. As key leaders of the 2000 Internation-

al Aids Conference inDurban, Abdool Karim and colleagues Jerry Coovadia and Malegapuru Makgoba were frequentlyin the public eye as aresult of their vocalrebuttals of this denialism.

Ministerial advisories, says Abdool Karim, consistofthreesections. Thefirstistypically a questionposed bythe ministerof health, the second consists of the scientific evidence andthethird istheadvisorycommittee’s recommendation.

“Looking back,it’s clear almostall [the MAC’s]recommendations werefollowed, sometimesnot exactlybut insome shapeor form,”hesays. However, as anadviser you are not responsible forall the decisions made by the government, he stresses.

“The reality is thateven scientists don’t always agree with each other all the time. Independently minded, knowledgeablescientists arenot renownedfor followingthe crowd. Disagreements, therefore, are not uncommon. As a memberof an advisory committee it’s importanttolisten toeveryone’s diverse viewpoint and appreciate differences of opinion.”

Diversityof opinion,hebelieves, wasa strength ofthe MACon Covid-19,allowing it to provide “pretty good advice”.

When Abdool Karim is discussing the role of an adviserhe knowswhathe’s talking about. He sits onnumerousrespectedadvisoryboards,including theWHO’s HIV Strategicand TechnicalAdvisoryCommittee and theWHO HIV/TB Taskforce.He’schair of the UNAids Scientific Expert Panel.

Rankedamongthe world’s most highly

cited scientistsby the Web ofScience platform,Abdool Karimsays agood leaderis somebody who listens andkeeps an open mind beforemaking ajudgment andproviding away forward. Importantly, agood leader doesnot allowdifferences inopinion to lead to a situation of paralysis where no decisions are made. “I’ve used the Codesa negotiations approach of‘sufficient consensus’as a wayformovingforward inthemidstofuncertainty,”he says.

The processfollowed by theMAC on Covid-19 includedthe submissionof constantly revised advisories,with additional input allowed at multiple stages.

“Thechallenge withthisepidemic isthat the evidence keeps changing. Covid-19 has resultedin aknowledge explosion.Over 70,000 articlesabout thediseasehave already been published in 10 months.”

What the pandemic has done, he says, is to democratisescience, making itmore accessible. Heis regularlycontacted by people from all walks of life writing to him about their analyses of the coronavirus data and interpretations of the epidemic. However, he says calls to“follow the science”ina bid to understandhowto handleCovid-19have placed a great burden on the discipline.

“Inthebeginningthere waslittleorno scientific evidence.We were goingon information and experiences from other diseases, like influenza.”

What Abdool Karim wouldlike to be remembered foris thathe alwaysput thepublic first,acknowledged uncertainty and what he did not know,maintained a steadfastly honest pathand never sugar-coated the truth. He predicts that pandemics like Covid19 willbecome morefrequent occurrences, andare likelytobemore severe.Hopefully we’ve learnt valuable lessons this time round which will stand us in good stead for the next one.

For now, AbdoolKarim ismorethancontentto focusonhis regularworkof HIVresearch and feed hisaddiction for sport in front of a television set.

He can still be found going for walks on Durban’s beaches with his wife but you’ll have to look carefully for him.

In anattempt tohave anuninterrupted walk hehas taken towearing abaseball cap and sunglasses to disguisehimself, as well as, of course, a face mask.

Less coal, more wind in its sails

Mining company plans a gradual move towards a low-carbon future of cleaner energy resources

By LYNETTE DICEY

● Exxaro Resources, at presentapredominantlycoal miningcompany,has startedto diversifyaway fromfossilfuels towardsalternative resourceopportunities.

The companyhas a20% stakein Kumba’s Sishen Iron Ore Company. It also hastwo wind farms in the Eastern Capewith a generationcapacity of239MWthrough itsownership of Cennergi, which owns and operates theTsitsikamma Communityand Amakhala Emoyeni wind farms.

“Renewable energies willbe a future growth area,”says Exxaro CEOMxolisi Mgojo. “Wehavebeen verydeliberateabouthow we diversify Exxaro’sportfolio towards cleaner energy resources.”

In March,Exxaro publishedits climate change position statement, which includes its target to be carbon neutral by 2050.

Mgojo says the company is cognisant of the physicaland transitional risksof climate change and considers it a serious threat both to the business and to society,

Adecisionwas taken todevelop policies and programmesto begin the transitionto a low-carbon future. Exxaro is part of the mining industry’s Just Transition Climate Change Pathways Project.

“Webelieve renewable energy resources can play a significant role in the supply of reliable powerin SA,providing greatereconomicparticipation andenergy securityfor previously marginalised communities and accessto affordableenergy, whilekeeping our communitieshealthy andresilient tothe impact of climate change,”says Mgojo.

Akeyelement ofExxaro’s climate change adaptation journeyis operationalresilience. Whatthis refersto,explainsMgojo, isthe company’sability towithstand changesin

theglobaleconomy bymanagingitsportfolioofprojectsand capital allocation and by climate-proofing thebusiness throughways of incorporating an eco-friendlier approach to supplying power.

However, Mgojo says coalwill continue to bea criticalpartof SA’senergymix forthe foreseeable future. “Coalwill remain relevantintheproduction ofelectricityinSAfor sometime tocome—high unemployment, loweconomic growthandhigh levelsof povertycreate alessthan idealsocioeconomic environment, in which coal cannot be switched off overnight. Thereforethe transition fromcoal maytake time.Even firstworld countries like Germany have taken two decadesto transition away from coal.”

Exxaro expects that demandfor coal will increaselocally astheMedupi powerstation in Limpopo—to whichExxaro suppliescoal —and theKusilepower stationin Mpumalangacomeonline. In2019,Exxaro’s sales were affected by delays at Medupi.

The issue ofEskom’s sustainability continues torepresent a significant riskboth to Exxaro and the economy, says Mgojo.

Self-generation of electricity,he says, will help to ensure SA’spower security. The company has no plans to invest in any new coal mines and wants to mine higher-quality coal with a lower ash contentfrom its existing reserves. ButMgojo says Exxarois cognisant

that it needs to have sufficient resources of coal to fulfil its existing long-term contracts.

Thenew carbontax, hesays,will adda costburden tothe businessand affect future earnings. It’san additionalincentiveforthe introductionof programmestooffset andreduce its carbon emissions.

Exxaro’s financial year ends in December. In March 2020 it reporteda 9% increase in core headline earnings forthe 2019 financial year, largely as a result of growth from Sishen Iron Ore Company.

Its interimresults —announced inAugust 2020 —were positive, largelyas a result of Exxaro’sability tocarry on operating throughthe lockdown.Key highlightsincluded a 23% increase in exports, a 16% rise in headlineearnings per share anda dividend payment of R6.43 a share.

Mgojo, who is alsopresident of Minerals Council SA,has beenintegrally involvedin the miningindustry’s response tothe Covid19 pandemic.

“Fortunately theindustryis by nature geared tohandle these challenges,given its focus on healthand safety. As aresult we already hadmany of the requiredprotocols in place.Ourresponseto thepandemicasan industry was a balance between saving lives and savinglivelihoods. Asa coalminer we were deemed an essential service —we’ve got tokeep thelights on —so wecould continue to operate, albeit at a reduced level and whileensuringsocial distancingandsufficient screening and testing.”

Along with othermining companies, Exxaro took the initiativeto procure and establish testing capacity —including machines,testing kitsandreagents—and to provide for qualified staff;or it made arrangements with private facilities to have access to increased capacity. The company invested intwo laboratories.These have subsequently beenmade availableto provide testingservices forlocal communities in addition to employees.

Thecompany donatedR20mto theSolidarity Fund, andadditionally, through the Exxaro Chairman’sFund andthe Exxaro Foundation, released R3.45m to assist Mpumalangaand Limpopowith community needs suchas improving waterand sanitation infrastructure, as wellas to supplyfood parcels, PPE and other consumables.

Acknowledging that the impact of the pandemic hasbeen significanton lowerlevels of staff, the company committed to giving increases toall nonmanagementand specialist staff,though boardand executive managementaswell asother management and specialistcategories’increases have been frozen for the year.

YOUR FUTURE, IS OUR FUTURE.

#WeAreInThisTogether

COVID-19 affects all of us. Not only is it a threat to our health, it also impacts our society and economy. We can beat COVID-19, but only if we work together.

We are committed to playing our role, to ensure the ongoing health and well-being of our employees and communities. We worked closely with government and our host communities to help identify and address their immediate needs.

As part of our ongoing response, we have committed over R220 million and have distributed food parcels, masks, hand sanitisers, drinking water and medical equipment alongside screening stations, hospital beds and isolation facilities.

Our roots have run deep in South Africa for more than 100 years. Let’s keep growing together.

www.bcx.co.za/digitalinnovationawards