Pan African Mining Logistics Business Plan › Section 9 › Financial Projections & Capital Plan

9.1 Approach and Key Assumptions

PAML’s financial projections are constructed on a bottom-up basis
from corridor-by-corridor unit economics. Each corridor is modelled with
its own fleet allocation, utilisation curve, tariff assumptions, fuel
and labour costs, and contract structure. The aggregate financial
statements are derived from this corridor-level build, ensuring that
headline revenue, EBITDA, and free cash flow numbers are fully traceable
to operational drivers.

Principal financial modelling assumptions are summarised in the
following table. A complete assumption schedule is set out in Appendix
A.

9.2 Capital Expenditure Programme

Total capital expenditure over the seven-year forecast period is ZAR
9.30 billion, of which ZAR 6.80 billion is funded through the proposed
capital raise (initial three-year programme) and ZAR 2.50 billion is
funded from internally generated cash flow (Years 4–7). The capex
profile is heavily front-loaded in Years 1 and 2 to support the rapid
fleet build-out required to capture anchor mining contracts.

Figure 8

9.3 Funding Stack

The ZAR 6.80 billion capital raise is structured to combine senior
secured debt, asset finance, mezzanine finance, and equity in a manner
that (i) minimises blended cost of capital, (ii) preserves equity
returns through prudent leverage, and (iii) satisfies the structural and
security requirements of each funding tier. Indicative terms have been
validated through preliminary discussions with three major South African
banks, two development finance institutions, and three institutional
equity investors.

Figure 9

9.4 Projected Profit and Loss Statement

Projected revenue grows from ZAR 2.80 billion in Year 1 to ZAR 14.80
billion in Year 7, a compound annual growth rate of 32% over the
seven-year forecast horizon. EBITDA margins expand from 15.0% in Year 1
to 25.0% in Year 7 as fleet utilisation rises, fixed-cost absorption
improves, and the higher-margin cross-border and multimodal services
scale up.

Figure 6

9.5 Operating Cost Structure

PAML’s steady-state operating cost structure is dominated by fuel and
energy (≈38%), with driver and labour, maintenance, and financing costs
collectively accounting for a further ≈41%. The cost structure is fully
aligned with industry benchmarks for high-utilisation bulk haulage
operations and is a key determinant of the EBITDA-margin envelope.

Figure 7

9.6 Projected Balance Sheet

PAML’s balance sheet evolves through three distinct phases over the
Plan period: (i) Years 1–2 are characterised by aggressive asset
build-out funded predominantly by drawdowns of the senior debt and asset
finance facilities; (ii) Years 3–4 see the asset base reach steady state
while leverage progressively de-risks; and (iii) Years 5–7 see
substantial free cash generation funding both organic growth and debt
reduction. By Year 7, the Company’s net debt-to-EBITDA ratio falls below
0.4x, providing balance-sheet capacity for either further organic
expansion, value-accretive acquisition, or significant shareholder
returns.

9.7 Projected Cash Flow Statement

PAML’s cash flow profile demonstrates the classic
infrastructure-investment pattern: significant negative free cash flow
in Years 1–3 driven by capex deployment, transitioning to positive free
cash flow from Year 4 onwards as utilisation matures and the asset base
begins to amortise. By Year 5, the Company generates ZAR 1.8 billion of
free cash flow, rising to ZAR 3.0 billion by Year 7.

Figure 10

9.8 Break-Even and Key Operational Triggers

PAML achieves operational EBITDA break-even from Year 1 (i.e.,
positive EBITDA from inception, supported by anchor contracts secured
prior to financial close). The Company achieves net-profit break-even in
Year 3, free-cash-flow break-even in Year 4, and cumulative-cash-flow
break-even (full payback) in Year 4 Q3.

The principal operational trigger for break-even is fleet
utilisation: the financial model is structured around a steady-state
utilisation target of 80%+ from Year 4 onwards. Below 70% utilisation,
EBITDA margins compress materially; above 85% utilisation, the model
assumes incremental capacity additions to capture demand without
compromising service reliability. Sensitivities to utilisation and other
key drivers are presented in Section 10.3.

Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of Pan African Mining Logistics (Pty) Ltd.