Jobs bloodbath in South Africa – while execs rake in millions

Thousands of mining jobs in South Africa have been lost or are at risk, but executives in these companies continue to earn millions.
Commodity prices, especially Platinum Group Metals (PGMS), have seen a widespread decline following a post-covid boom.
The price of PGMS has dropped substantially amid destocking from the auto industry and weaker-than-expected demand from China.
PGMs are mainly used in catalytic converters in internal combustion engines to reduce their emissions. However, with the rise of electric cars, the need for reduced emissions from a fuel-powered car has lessened.
With a drop in these commodities’ value, major mining companies have been hit financially.
Anglo American Platinum (Amplats) said its profit dropped from R49.2 billion in 2022 to R13 billion last year.
Amid this challenge, the group said it would undergo a section 189A process, with a potential 3,700 employees (17% of its workforce) affected by the cuts.
Despite the significant potential job cuts, Amplats is still set to pay shareholders more than R6 billion in dividends.
In addition, several executives in the group saw their single-figure remuneration increase for the 2023 financial year, with the company spending R425,679 a day on its eleven senior executives throughout the year.
Executive | Position | FY22 | FY23 |
Craig Miller* | CEO and former CFO | R22 947 314 | R25 846 999 |
Hilton Ingram | Executive Head: Marketing, PGMs and AA | R26 420 332 | R23 031 276 |
Natascha Viljoen* | Former CEO | R39 825 464 | R15 233 806 |
Riaan Blignaut** | COO | R12 932 282 | R15 371 334 |
Prakashim Moodliar | Executive Head: Projects | R14 075 957 | R14 598 384 |
Yvonne Mfolo | Executive Head: Corporate Affairs | R12 112 251 | R13 071 989 |
Virginia Tyobeka | Executive Head: Human Resources | R8 914 699 | R10 404 577 |
Wade Bickley** | Executive Head: Mining Technical | – | R14 306 082 |
Sicelo Ntuli** | Executive Head of Shee and AR | – | R11 613 523 |
Agit Singh** | Executive Head: Processing Technical | – | R9 635 204 |
Sayurie Naidoo** | Acting CFO | – | R2 259 590 |
Moving away from theoretical job cuts, Sibanye Stillwater also recently announced that 2,600 workers were axed by the group.
“While the decision to close or restructure operations is never taken lightly, the S189 consultation process encouragingly achieved the necessary requirement of addressing loss-making operations and ensuring the sustainability of our SA PGM operations and the benefits and value they bring to multiple stakeholders,” said Sibanye CEO Neal Froneman.
Froneman’s pay has often been a point of contention. The CEO earned a whopping R300 million in the 2021 financial year—a large part of which was long-term share incentives awarded in 2018. However, his salary dropped the following year to a more “respectable” R189 million.
Sibanye recently reported an R37.9 billion loss after taking an impairment against its US palladium mine.
The share price has also dropped from over R70 two years ago to roughly R20 today.
However, Froneman was relatively unaffected by the change in share price after exercising a put option.
A put option is a contract that gives the option buyer the right, but not the obligation, to sell a specified number of shares at a predetermined price within a stipulated time frame.
The predetermined price at which the put option buyer can sell the underlying security is called the strike price.
On Tuesday, 5 March, when the share price was just over R18.00, Froneman exercised his put option at a strike price of R66.24.
This pocketed the CEO R96.38 million.
PGMs under pressure
Although these figures make for tough reading in a country with the largest income inequality in the world, PGM job cuts are somewhat inevitable.
Coronation, which does not hold PGM shares in its portfolio, recently predicted a tough couple of years going forward for PGMs.
Due to the higher levels of battery electric vehicle (BEV) manufacturing in the coming years, the PGM market is expected to experience large surpluses in the future.
Amplats is working with Sasol and BMW to bring green-hydrogen-powered car to South Africa, with PGMs seen as essential in the production, distribution and consumption of green hydrogen.
However, Coronation said that, like hybrids, fuel cells will likely lose out to BEVs on many of their applications.
“Closing mines in South Africa has proven to be incredibly hard in the past, given the socioeconomic implications, and we expect that PGM miners will hold on to loss-making shafts for longer than is viable,” said Coronation’s Nicholas Hops.
“With growing surpluses and unfavourable capital allocation, we believe that the PGM sector is a value trap and that any rallies in the interim will be short-lived.”