2025 Integrated annual report

Responsible

Strategic objective

Operate our portfolio of assets safely, responsibly and efficiently

Underpinned by our values

Aim for operational excellence

Provide a safe and healthy work environment

Maintain a non-discriminatory workplace

Improve the lives of those living in communities neighbouring our operations

Work responsibly to achieve balance between the economic, social and environmental aspects of our business

Maintain the highest standards of corporate governance

Why

Protect value by responsibly and efficiently operating our assets and managing people

How
  • Drive operational efficiencies and ensure competitive position on global cost curve
  • Contain unit cost increases
  • Implement appropriate innovation and new technologies
  • Ensure a safe and healthy work environment
  • Invest in our people's personal and professional wellbeing
  • Enhance relationships with key stakeholders by driving positive and sustainable impact in communities neighbouring our operations
  • Remain responsible stewards of the environment.
Measured by
  • Position on the global cost curve for each operation
  • Unit cost increases relative to inflation
  • Efficiencies as measured by volumes and unit cost performance
  • Safety and health indicators, including fatalities, LTIFR, and eliminating occupational illnesses
  • Human capital investment to attract, develop and retain talent, promote diversity, equity and inclusion; and minimise turnover
  • Total investment in host communities (including impact of social and labour plans, local economic development and corporate social investment)
  • Reducing greenhouse gas (GHG) emissions in support of a sustainable transition to achieve net-zero GHG emissions from mining by 2050
  • Water withdrawn and water reused
  • Conformance of our tailings storage facilities (TSFs) to global standards
  • Adequate provision for environmental rehabilitation.

Resilient

Strategic objective

Allocate capital to value-creating investments

Underpinned by our values

Aim for operational excellence

Provide a safe and healthy work environment

Maintain a non-discriminatory workplace

Improve the lives of those living in communities neighbouring our operations

Work responsibly to achieve balance between the economic, social and environmental aspects of our business

Maintain the highest standards of corporate governance

Why

Create and sustain value by prudently managing financial capital

How
  • Ensure effective allocation of financial capital
  • Manage a robust financial position that enables us to be opportunistic and resilient
  • Integrate ESG criteria in investment decisions to ensure positive and sustainable impact.
Measured by
  • Returns on capital investment, including net present value (NPV), internal rate of return (IRR) and payback period
  • Benchmarking returns from investment opportunities to returns from share buybacks
  • Dividend payouts
  • Total shareholder returns
  • Net cash/debt position
  • Debt funding capacity
  • Investing in value-accretive growth opportunities that meet ARM's strategic imperatives.

Ready

Strategic objective

Focus on value-enhancing and integrated growth

Underpinned by our values

Aim for operational excellence

Provide a safe and healthy work environment

Maintain a non-discriminatory workplace

Improve the lives of those living in communities neighbouring our operations

Work responsibly to achieve balance between the economic, social and environmental aspects of our business

Maintain the highest standards of corporate governance

Why

Create and unlock additional value by investing in growth and innovation, supporting sustainable responses to the changing operating environment

How
  • Drive innovation and capitalise on value-accretive opportunities for growth
  • Support inclusive business opportunities in communities neighbouring our mines
  • Focus on local and preferential procurement from women/youth-owned businesses
  • Drive shift to net-zero GHG emissions from mining by 2050
  • Invest in skills of the future
  • Continually assess portfolio for disposal opportunities or points of exit.
Measured by
  • Returns, including IRRs, NPV and payback periods
  • Successful development of more efficient smelting technology
  • Optimised energy consumption in smelting process
  • Local and preferential procurement spend and number of SMMEs supported
  • Impact and sustainability of community investment
  • Decarbonisation pathways and year-on-year reduction in GHG emissions
  • Investment in skills training.

Bokoni update

The acquisition of Bokoni was underpinned by its superior Mineral Resources, both in grade and size, presenting a clear long-term value-creation opportunity. ARM's investment thesis envisages a large-scale mechanised mining operation, designed to unlock economies of scale and deliver competitive rand-per-tonne operating costs. The strategy is focused on the UG2 Reef, which not only carries a Mineral Resource grade 30% higher than the Merensky, but also benefits from lower geological losses.

In 2023, the early ounces project was approved as an initial step toward the larger 240 thousand tonnes per month (ktpm) mine development. The project was designed to unlock early value by leveraging existing infrastructure – including the 60ktpm UG2 concentrator plant and underground infrastructure at Middelpunt Hill Decline – while advancing mechanised UG2 development and mining conventional stopes that had remained unmined when the mine was placed on care and maintenance. Importantly, the early ounces project was always envisaged as a strategic precursor and enabler of the long-term growth strategy, rather than a standalone business.

As market conditions evolved, with weaker PGM prices and an uncertain outlook, ARM made the disciplined decision to defer the 240ktpm growth project. Without this larger scale, the lower production volumes obtained from the early ounces project could not achieve the required economies of scale. As a result, ore mining and milling operations were suspended at the end of F2025, enabling Bokoni to refocus capital and strategic efforts on ore reserve development to support sustainable future production.

Looking ahead, Bokoni's future lies in a higher-grade, smaller-scale development path. By revising the mining method, we aim to maximise ore grade and revenue per tonne, while maintaining capital efficiency. The revised plan targets an initial 120ktpm operation, with phased expansion to 240ktpm.

A feasibility study for the 120ktpm development is currently underway and is expected to be completed in early 2026, after which an investment decision will be made. We remain confident that this disciplined, high-grade strategy is the right approach to unlock the full value of Bokoni's world-class Mineral Resource, positioning the mine for sustainable returns over the long term.

Investing in growth and our existing business

Implementation of a hedging collar transaction over 24% of ARM's equity in Harmony

ARM implemented a hedging collar transaction involving 18 million shares in Harmony Gold, representing 24% of its equity in Harmony. The collar and related arrangements provide ARM with access to future funding on efficient terms while retaining partial upside exposure. The structure includes a put option at R234.85 and a call option at R562.40, both maturing in June 2030.

ARM remains fully committed to Harmony as a strategic investment and remains confident in Harmony and its management's ability to drive growth and value for its shareholders.

Please refer to the announcement released on the Stock Exchange News Service (SENS) on 11 June 2025 for further details.

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Delisting of ordinary shares pursuant to a general repurchase and intra-group distribution of ARM treasury shares

ARM, in accordance with the general authority granted by shareholders at the company's annual general meeting held on 6 December 2024, has cumulatively repurchased and cancelled 3 239 681 ordinary shares, at an average price of R154.27 per share, totalling approximately R499.8 million. Additionally, ARM's subsidiary, Opilac, distributed 12 717 328 treasury shares in specie back to ARM, which were cancelled and delisted. These actions reduced the total issued share capital by 7% to 208 710 769 ordinary shares. The cancellation of the treasury shares has no impact on the earnings per share and headline earnings per share of ARM.

Please refer to the announcement released on SENS on 20 June 2025 for further details.

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Closure of Cato Ridge Works and Alloys, and disposal of certain land assets of Assmang and Assmang's interest in Sakura

ARM has announced a series of strategic transactions involving its 50% stake in the joint venture, Assmang. These include the permanent closure of the Cato Ridge Works plant, effective 31 August 2025. Assmang will also sell various land, properties and houses in Cato Ridge to Assore SA PropCo Proprietary Limited for R453 million, with part of the land designated for community benefit. Additionally, Assmang will dispose of its 54.36% stake in Sakura Ferroalloys to Assore, resulting in a cash distribution of R900 million to ARM.

Please refer to the announcement released on SENS on 30 June 2025 for further details.

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Surge Copper

ARM under a strategic placement, has purchased 25 781 715 common shares of Surge Copper Corp (Surge Copper) at a price of C$0.175 per share, for a total consideration of approximately C$4.5 million. ARM's ownership in Surge has increased to 19.9%. This follows ARM's earlier exercise of its rights under an investor rights agreement, where it purchased 1.6 million shares for C$0.24 million in a top-up offering. Prior to these transactions, ARM held 43.0 million shares (13.4% of Surge's issued shares), and upon completion of the private placement, its shareholding will increase to 68.7 million shares, representing 19.9% of the company on a non-diluted basis. Surge Copper has made strong progress on the prefeasibility study, which remains on track for completion in 2026.

Please refer to the announcement released on SENS on 15 August 2025 for further details.

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