Good morning, by way of introduction, I am Natascha Viljoen, the CEO of Valterra Platinum. Thank you for joining the Valterra Platinum 2020 interim results presentation. Today I'm joined by Craig Miller, our Finance Director, and together we will go through the performance of the company for the H1 of 2020 and provide further guidance. I would like to draw your attention to the cautionary statement, which we will appreciate if you could take the time and read in full. Before we start, I would like to take a moment on behalf of everyone at Valterra Platinum to pay our respects to the victims of the COVID-19 virus. We extend our deepest condolences to their family, friends, and colleagues. We have faced significant headwinds in the first six months of 2020 with the impact of COVID-19 and the temporary shutdown of the ACP.
Yet despite these challenges, our performance highlights the resilience of our business. We have reported zero fatalities at our own managed operations. We are proud of the work we've been doing to support our employees and host communities during the pandemic and to ensure we look after their wellbeing. We have paid ZAR 1.2 billion on salaries and benefits to people not working during lockdown and invested ZAR 250 million on COVID-19 measures, of which ZAR 55 million was invested in our host communities. The fundamentals for the PGM market remain robust despite the impact of COVID-19 globally. Whilst PGM prices were volatile in the period, the PGM dollar basket price increased by 56%. The strong price environment underpinned our resilient financial performance with a net cash position of ZAR 11.3 billion after paying ZAR 11.1 billion in dividends in March.
Considering our disciplined and value-focused approach to capital allocation, the board has declared an interim dividend based on 40% of headline earnings aligned to our dividend policy equal to ZAR 2.8 billion. The company's core value of safety starts with a primary focus to eliminate fatalities. In the first half of the year, we achieved zero fatalities at our own managed operations. This has taken our fatality-free period to 620 days despite the challenges and safety risks brought about by shutting down and restarting operations due to the lockdowns. Tragically, we did have one fatality at the joint venture operation, Kroondal, and we send our condolences to Charles Zindani's family, friends, and colleagues. We continue to work with our joint venture partners to improve safety at these operations.
We saw a reduction in our injury frequency rates with a total recordable case injury frequency rate down 15% since 2019 to 2.24 per 1 million hours worked. While we are proud of our safety achievements, we do not take these results for granted and will continue to pioneer and implement new technology, digitization, and modernized operations to further improve safety. The health, safety, and wellbeing of our employees and contractors is at the heart of our approach to dealing with the COVID-19 pandemic. We are focused on three main aspects, preventing the spread of COVID-19 in the workplace and in our host communities, responding to outbreaks, and planning for the critical recovery phase to ensure we play our part in supporting economic recovery and livelihoods in our communities.
We developed our comprehensive We Care program in close collaboration with a range of stakeholders to identify and address the areas of greatest need. We have invested ZAR 250 million in industry-leading measures to limit the spread of the virus at the workplace and in our communities. These investments include our own testing laboratories, protective masks, hand sanitizers, and isolation and quarantine facilities. COVID-19 has highlighted the serious needs in our communities, which requires a collective response effort. We have invested around ZAR 55 million in initiatives to look after our local communities with our efforts, including water and food supply, providing assistance to local clinics and hospitals, COVID-19 education and awareness campaigns, and supporting victims of gender-based violence. We are also working on extending our response plan to beyond the pandemic, focusing on job training for employment opportunities and regional development planning to enhance local economic activity.
Our responses have enabled us to work in new ways with our stakeholders, I believe we are investing in partnerships and solutions that will continue to benefit our communities long after the pandemic is over. A challenging H1 saw our metal in concentrate production decrease 25% to 1.6 million PGM ounces. This was primarily due to the shutdown of operations in South Africa and Zimbabwe in response to COVID-19. By the end of June, production levels at our own mine operations were around 80% of normal capacity, we expect this to increase to over 95% by the end of the year, as we benefit from a high proportion of open pit and mechanized production. Our refined PGM production, excluding tolling, decreased by 49% to 1 million ounces. This was largely due to the impact of the ACP repairs, as well as Eskom load shedding in the first quarter.
These stoppages haven't resulted in lost production, but a buildup in work-in-progress inventory, which is expected to be released and refined by the end of 2021. Despite these headwinds, we achieved an all-in sustaining cost for the company of a - ZAR 480 per platinum ounce sold, highlighting the sizable margin we continued to generate. When South Africa announced the national lockdown, Mogalakwena was granted permission to operate the North Concentrator, which remained in production by drawing down on all stockpiles. Thereafter, a gradual increase in operational activity was granted, and by the end of June, the mine was operating at 100% production levels and is expected to continue at this level. As a result, the mine was less impacted by the national lockdown and only experienced an 8% reduction in PGM production. PGM production decreased by 48% to 217,800 PGM ounces.
At the end of June, Amandelbult was operating at 50%. A measured and safe approach has been taken in ramping up the mine, which ensured the operation has not had to close due to an outbreak of COVID-19. By considering safety and hygiene protocols established for COVID-19, by the end of the year, the mine should reach production levels of around 85%. On top of addressing the impact of COVID-19, we recognize there is more work to do and improve performance at Amandelbult. Implementing modernized mining equipment in a conventional mining environment, as well as a mechanized section within Tumela 15 East, will help repositioning the mine to become a safer, more efficient, and more productive operation. PGM production at Mototolo decreased by 24% to 81,500 PGM ounces as a result of the lockdown. Collaboration with labor unions was key to the restarting of operations.
While discussions with Mototolo's majority labor union, GIWUSA, lasted six weeks, we are focused on building strong relationships and trust going forward. At the end of June, Mototolo Mine was operating at a production level of around 90%, and should be at full production by the end of July. When Zimbabwe announced a national lockdown on the 28th of March, Unki Mine conducted a safe and measured shutdown to care and maintenance, losing nine days of mining production. With effect from 7 April, 2020, however, the government recognized mining as an essential service, and Unki was able to ramp up to full production. As a result, Unki PGM production decreased by 16% for the H1 to 80,300 PGM ounces, and by the end of June, was operating at full production. Processing capacity was severely impacted in the H1 by the temporary closure of the ACP for repairs.
In February, the P hase A was damaged following an explosion within the converter, and it was immediately closed. The P hase B was recommissioned to take over and subsequently experienced two separate water leak incidents, which presented a high explosion risk. Each time, there were no injuries, and the decision made to close the ACP to ensure an ongoing safe operating environment to protect our employees and the integrity of the plant. Following repair work, the ACP Phase B was able to safely ramp up, with operations now at full capacity. We want to ensure we have no uncontrolled events and are implementing technology, measurement systems, and greater automation to ensure a proactive and predictive control environment. This will result in stable operations that better protects our assets and our people.
We will remain cautious with the ongoing operation of the Phase B unit, with increased monitoring likely to result in intermittent stoppages to inspect the plant until the repairs to phase A are completed. The rebuild of Phase A is progressing well and is expected to be completed towards the end of 2020. As a result of the temporary closure of ACP, there has been an increase in work-in-progress inventory, which has increased from around 950,000 3E ounces to the current levels of close to 1.45 million 3E ounces. This is the primary reason that refined PGM production, excluding tolling, decreased by 49% and sales volumes decreased by 38%. Sales were supplemented by drawdown of refined inventory. I will now hand over to Craig to talk to you about our financial performance.
Thank you, Natascha. Good morning everyone. The H1 financial performance has been impacted by the challenges outlined by Natascha. However, the resilience of our business has enabled us to see through these headwinds, and despite their impact, we've delivered a solid set of financial results. EBITDA increased by 6% to ZAR 13.1 billion, delivering a margin of 32%. The return on capital employed also increased to 48%. We achieved headline earnings of ZAR 6.9 billion or ZAR 26.27 per share, down 7% from H1 2019. The company's balance sheet remains strong, with net cash of ZAR 11.3 billion after paying the final 2019 dividend of ZAR 11.1 billion in March 2020. This places us in a position to declare a dividend of ZAR 2.8 billion for H1 2020. As I mentioned, EBITDA increased by ZAR 0.7 billion to ZAR 13.1 billion.
This was due to the higher USD rhodium and palladium prices and the weaker rand-dollar exchange rate, contributing ZAR 9.1 billion and ZAR 2.6 billion respectively. This was partly offset by local CPI inflation and higher royalties totaling ZAR 0.9 billion. The operational headwinds resulted in ZAR 11.2 billion impact to EBITDA. These were as a result of the temporary closure of the ACP, which resulted in lower refined production, lower production from our mining operations, and third-party purchase of concentrate partners following the national shutdowns. Additional costs of ZAR 250 million were incurred in respect of contributions to the COVID-19 healthcare and community response plans, and we incurred ZAR 1.2 billion in salaries and other benefits to employees not working during the lockdown. Savings across the business resulted in ZAR 2 billion lower costs compared to H1 2019. Turning to unit costs.
Due to the 25% decrease in mining production and our response to the COVID-19 pandemic, the unit cost of production per PGM ounce rose by 26% to 12,555 ZAR. Excluding the impact of unproductive labor of 1.2 billion ZAR or 1,057 ZAR per ounce, unit costs are 11,498 ZAR, 16% higher than the H1 of 2019. Operational costs decreased as a result of the cost savings realized in the H1 of 2020 of 2 billion ZAR. The all-in sustaining cost was a -$480 per platinum ounce sold against the average platinum achieved price of $857 per ounce. We expect unit costs to reduce to between 11,500 ZAR and 12,000 ZAR per PGM ounce in the H2 of the year as production increases and further cost savings are realized.
Full year unit cost guidance for 2020 has been revised to between ZAR 11,800 and ZAR 12,200 per PGM ounce as a result of the ongoing implications of COVID-19. Trade working capital at the 30th of June was ZAR 6.6 billion, equivalent to 47 days compared to ZAR 3.1 billion at the end of December 2019. The net increase was mainly attributable to higher work-in-progress inventory ahead of the ACP as a result of its temporary shutdown. It's expected that approximately 45% of this buildup in inventory will be released in the H2 of the year and the balance in 2021, subject again to Phase B operating uninterrupted for the rest of the year. Higher prices resulted in an increase in the customer prepayment of ZAR 6.7 billion- ZAR 16.1 billion.
H1 capital expenditure was ZAR 1.9 billion as a result of the capital expenditure deferments of ZAR 0.6 billion. Stay-in-business capital expenditure was ZAR 1.4 billion focused on tailings dams, investments in Mogalakwena heavy machinery equipment, smelter rebuilds, and asset reliability. The total cost of the ACP Phase B repair is ZAR 150 million, which is at the lower end of our previous estimates. The total cost of ACP Phase A rebuild is expected to be between ZAR 500 million and ZAR 600 million. Project capital was ZAR 200 million lower than planned, owing to the scope deferments attributable to the COVID-19 lockdowns affecting the Unki debottlenecking project and the Tumela 15 East mechanization projects at Amandelbult. A further ZAR 300 million has been spent on progressing our breakthrough projects such as the Mogalakwena bulk ore sorting and coarse particle rejection project and the Amandelbult modernization.
2020 CapEx guidance is revised downwards to between ZAR 5.7 billion and ZAR 6.5 billion as a result of the deferment for 2020 of ZAR 1 billion. Despite the operational challenges, the company ended the 1/2 year in a net cash position of ZAR 11.3 billion after the payment of ZAR 11.1 billion in dividends in March. Largely as a consequence of the inventory build, cash utilized in the H1 was ZAR 3.5 billion. Excluding the customer prepayment of ZAR 16.1 billion, the company is in a net debt position of ZAR 4.8 billion. Liquidity headroom is at ZAR 16.6 billion, comprising of both undrawn committed facilities of ZAR 12.1 billion and cash of ZAR 4.5 billion, excluding the customer prepayment. The company operates comfortably within its debt covenants.
In line with our capital allocation framework and our dividend policy, where we target a payout of 40% of headline earnings, the board has declared a H1 cash dividend of ZAR 2.8 billion, or ZAR 10.23 per share. Thank you. I'll now hand you back to Natascha.
Thank you, Craig. PGM prices were high in the first half. We achieved an increase in our average realized dollar basket price of 56% thanks to buoyant rhodium and palladium prices. As the rand weakened 13% against the US dollar, the rand basket price averaged 80% higher year-on-year. These average prices mask what was a very volatile period. Palladium and rhodium set new all-time price highs in March, but later that month, all three PGMs saw a steep sell-off as wider markets sold off on COVID-19 fears. More recently, prices have rallied again and all ended the first half higher year-on-year. The automotive sector accounts for 65% of gross 3E PGM demand, 35% of platinum demand, and around 85% of palladium and rhodium demand. Monthly global sales of light-duty vehicles fell sharply from February as the pandemic spread globally, locking down consumers, dealerships, and factories.
We estimate light-vehicle sales fell 28% in the H1 . However, recovery has started. In China, which reopened earlier, vehicle sales had returned to normal by May. In the rest of the world, May and June have seen strong month-on-month growth. Of course, it's too soon to say things are back to normal. The rebound in sales is uneven and could be fragile. We predict that a full-year decrease in auto sales could be around 22% if recovery remains at current levels, with an upside scenario of a fall of 14% if auto sales recover to 2019 levels in H2. Looking further ahead, we see a robust picture overall for PGM demand. As forecast by LMC Automotive, battery electric vehicles are expected to gain market share.
It is important to stress that the majority of electrified vehicles, which includes hybrid vehicles, battery electric vehicles, and fuel cell vehicles, will still require PGM catalysts. Internal combustion engine-based vehicle sales, including hybrids, are forecast to be 9% higher in 2027 than in 2019. Importantly, we expect total demand for PGMs from the auto sector to grow even faster as loadings per vehicle increase. Loadings per vehicle have risen significantly in recent years as emission legislation, particularly in Europe and China, have tightened. As the clean air movement grows, tightening emissions legislation, which have already led to an increase in loadings, are expected to become more stringent. For example, Euro 7 is already under discussion and will continue to push loadings higher. We also expect to see an increase in PGM demand from light-duty fuel cell vehicles, and particularly in heavy-duty vehicles, not shown.
Notwithstanding the current negative impact of COVID-19 on other demand sectors, we believe the medium-term demand outlook remains positive. Industrial PGM demand has been resilient through the crisis, while jewelry demand has suffered from the lockdowns. Investment demand was mixed. All three PGMs saw ETF selling, whilst platinum has also seen strong bar and coin buying. Looking ahead, we are confident industrial PGM demand will be positive. It benefits from having a large and diversified range of expanding end users, and we are seeing strong momentum in the hydrogen economy. Jewelry demand should be stable. Lower incomes and changing consumer preferences are a challenge, but pent-up demand and a growing middle class will provide support. Investment demand will benefit from production innovation and investor education. 2020 will be a challenging year for PGM demand due to COVID-19.
However, PGM mine supply will also be lower in 2020, about 22% by our estimates, with platinum and rhodium especially hit due to their reliance on South African production. As such, market balances have not worsened this year. In fact, we estimate all three PGMs to be in deficit this year. In the longer term, both PGM supply and demand will recover, and overall, we see relatively little change in our markets from COVID-19, with enduring demand across the three metals. We have a restructured and simplified business with high-quality assets that are the foundations from which we can build the business for the future. In the immediate term, we have had to focus on remaining resilient during COVID-19 while keeping the health and wellbeing of our employees and surrounding communities as our main priority.
Our environment, social, and governance philosophy is embedded in all we do. Our people remain at our core. This focus ensures we seek to strike the balance between producing industry-leading returns for our shareholders and creating a sustainable future for other stakeholders, so that we can meet our purpose of re-imagining mining to improve people's lives. Despite the difficult environment, we have not stopped thinking about our future, and we continue to focus on four key areas that will drive further value. Increasing operational efficiency, innovation through the use of breakthrough technology, high returning, value accretive projects and growth options, and championing market development for PGMs. We are looking at a refresh of the company strategy that will build on these key foundations of creating value through the cycle, and should be in a position to announce these later in the year.
Mogalakwena remains the world's most significant PGM operation, and the only major open pit PGM operation globally. Given the size of the resource, the project study has identified several options to expand PGM production. The study has progressed to a feasibility study, and is reviewing 6 key areas of focus to shape the future of Mogalakwena, which comprise an optimized mine plan and operational performance, development and deployment of new technology to improve throughput and recoveries, building additional concentrator capacity, optimizing resource development of both open pit and underground options, and utilizing downstream processing capacity to maximize value. Aligned with our purpose, we want to reshape our relationships with our local communities to create trusting relationships and valued partnerships to ensure they can also thrive and prosper. We continue to lead the industry's demand creation efforts across the industrial, investment, and jewelry demand segments.
Within the industrial space, the hydrogen economy and fuel cells are gaining traction as governments around the world announce large-scale investments as part of their decarbonization strategies. Our market development activities are not only helping shape the hydrogen market globally, we are also directly involved by developing the world's largest hydrogen-powered fuel cell mining haul truck. This truck will be trialed at Mogalakwena and includes the onsite generation of hydrogen through electrolysis from solar power, which is then used to refuel the truck. At scale, mining fuel cell trucks would create significant demand for green hydrogen, accelerating the hydrogen economy, and ultimately helping to lower the cost of hydrogen for all other fuel cell applications. Importantly, if the technology is commercially adopted, this will enable significant decarbonization of our operations. As a result of the impact of COVID-19 and the ACP repairs, we revised our guidance, which remains as follows.
PGM production is expected to be between 3.1- 3.6 million ounces. Refined PGM production guidance, which excludes tolling, is also expected to be between 3.1- 3.6 million ounces. Sales volumes remain in line with refined production, excluding traded ounces sold. Lockdowns impacted capital spent in the first half, and we revised our capital expenditure for sustained business and project capital to between ZAR 5.7 billion and ZAR 6.5 billion. Capitalized waste stripping is estimated to be between ZAR 2.4 billion and ZAR 2.6 billion. Unit cost guidance has been revised to between ZAR 11,800-ZAR 12,200 per PGM ounce for the full year.
Significant headwinds are expected for the remainder of 2020, with several variables that could affect production, including operational impacts as a result of the spread of COVID-19, possibility of power outages from Eskom, and maintaining the stability of the ACP Phase B unit until the repairs to ACP Phase A have been completed and the unit commissioned. To conclude, Anglo American Platinum has proven its resilience, and the team is focused on building the business beyond the significant challenges in the H1 . We have maintained zero fatalities at managed operations for over 620 days, and will continue to focus on our safety performance. Our ESG strategy to support stakeholders is of greater importance and impact during the COVID-19 pandemic, and we are proud of the significant work we have been doing to support our employees and host communities.
There remain robust fundamentals for the PGMs we produce, particularly driven by the clean air movements. We are in a strong financial position with a net cash position of ZAR 11.3 billion, despite a buildup of work in progress inventory, which we expect to release around 45% of in the second half. The board has declared an interim dividend based on 40% of headline earnings. Despite the expectation that a post-COVID world remains some way off, we have not lost our focus on building the business for the future. Whilst we do expect a stronger second half performance, particularly operationally, we caution that significant headwinds still exist. Thank you for listening.