New CEO for R53 billion mining giant in South Africa

Exxaro has appointed seasoned mining executive Ben Magara as its new CEO, replacing Nombasa Tsengwa, who resigned under a cloud in February.

Magara will take over as CEO on 1 April 2025 and will be supported by Finance Director Riaan Koppeschaar, who has served as interim CEO.

Magara is a qualified mining engineer and has over 35 years of experience in hard and soft rock at underground and open pit operations.

He is known for his strategic leadership at multiple large mining operations. He recently stabilised and restructured Lonmin, which was sold to Sibanye Stillwater, creating the world’s largest PGM producer.

He founded Africa Mining & Metals Group, a mining and advisory company focused on battery and precious metals.

Magara has spent several years in the Democratic Republic of Congo’s mining industry, advising in the Copperbelt.

He will remain an independent non-executive director at Weir Plc but will step down from the board of Grindrod Limited on 1 April 2025.

“Ben Magara brings a wealth of mining leadership, global board, and governance experience to Exxaro along with a reputation for impeccable integrity,” said Exxaro Chairman Geoffrey Qhena.

“We are confident Ben will stabilise the organisation and continue to drive forward our growth and sustainability strategy, particularly with the knowledge he brings from being chairman of our Investment Committee.”

Exxaro is highly dependent on coal, and the company wants to diversify away from the world’s most polluting fossil fuel.

Magara said he would use the group’s strong coal foundation to expand its portfolio towards critical low-carbon minerals.

“This is in line with our diversification strategy, which I have been part of as Exxaro’s Non-Executive Director and Investment Committee chairman,” he said.

“I believe this strategy will enable us to deliver enhanced value to all our stakeholders while balancing enduring profitability with environmental and social sustainability.”

Tough times for the miner

Magara’s appointment follows a period of upheaval at Exxaro, with Nombasa Tsengwa recently resigning after failing to have a suspension lifted.

Tsengwa was placed on precautionary suspension in December 2024 over allegations of poor workplace conduct and governance practices. She claimed that the investigation was biased against her.

The R53 billion mining giant is coming through a challenging period where its EBITDA and headline earnings have significantly declined.

In its financial results for 2024, the group said that overall coal sales reduced by 3% 39.4Mt in FY24, mainly due to lower demand from Eskom.

Export sales, however, increased by 37% to 7Mt from 5.1Mt in FY23, driven by the use of alternative distribution channels and the improved performance of Transnet Freight Rail.

Its renewables unit, Cennergi, saw its operating wind assets generate 725 GWh of electricity in FY24 compared to 727 GWh in FY23.

Revenue from Cennergi jumped by 5% to R1,411 million from R1,345 million in FY23. Wind generation was in line with the December 2024 guidance of 729GWh.

Overall, group revenue increased by 5% to R40.725 million. However, group EBITDA decreased by 22% to R10,423 million.

This drop in Group EBITDA was mainly attributable to the 16% decrease in Coal EBITDA and a negative contribution from the ‘Other’ operating segments.

Adjusted equity-accounted income dropped by 47% to R3,685 million in FY24, which was mainly driven by Sishen Iron Ore’s (SIOC’s) adjusted equity-accounted income, which fell due to lower drastically due to lower iron ore prices and lower sales volumes.

Following this, headline earnings decreased by 36% to R7,298 million in FY24, with headline earnings per share declining to 3,016 cents per share in FY24.

The final dividend of 866 cents per share marked a 144-cent drop from 2023. However, overall dividends for the year increased to 2,378 cents per share from 2,279 cents per share in 2023.

This was due to the group declaring a special dividend of 572 cents per share in May of the 2024 financial year.