Tharisa

Kudos to this mining company's quarterly updates. It provides investors with an excellent indication of what is happening in the metals markets. It would be of great help if the other miners did the same.

 

Market update

The average PGM contained metal basket price (per ounce) for the three months to end 31 December 2017 was USD865 (ZAR11 827), which was USD40 an ounce higher than the USD825 (ZAR10 866) achieved in the quarter to end 30 September 2017. PGM basket prices continued to reflect improvements in spot palladium and rhodium prices with palladium comprising 16.6% and rhodium comprising 9.4% of the Tharisa basket.

 

Spot palladium prices averaged USD993 per ounce in Q1 FY2018, ending the calendar year at USD1 057 an ounce, while spot rhodium prices averaged USD1 351 per ounce in Q1 FY2018, ending the calendar year at USD1 470 an ounce. Spot palladium prices increased 58.0% and rhodium prices increased 52.6% in 2017.

 

Contracted metallurgical grade chrome concentrate prices increased 4.1% to USD179 per tonne from USD172 per tonne in the previous quarter due to improved liquidity and consistent stock levels at ferrochrome and stainless steel producers in China. Current metallurgical chrome spot prices are above USD200 per tonne for February 2018 shipment.

 

As at 29 December 2017, Chinese port stock levels were at 2.2 Mt, or approximately two months' supply into the ferrochrome and stainless steel industry. The market fundamentals for chrome remain sound with continued growth forecast for the global stainless steel industry.

 

Specialty chrome concentrates, which comprise 24.1% of Tharisa's total chrome production, continued to attract a premium above the contracted metallurgical chrome concentrate prices.

The share price has reacted nicely as a result. Up 21% in a week.

Kudos to this mining company's quarterly updates. It provides investors with an excellent indication of what is happening in the metals markets. It would be of great help if the other miners did the same.

Market update

The average PGM contained metal basket price (per ounce) for the three months to end 31 December 2017 was USD865 (ZAR11 827), which was USD40 an ounce higher than the USD825 (ZAR10 866) achieved in the quarter to end 30 September 2017. PGM basket prices continued to reflect improvements in spot palladium and rhodium prices with palladium comprising 16.6% and rhodium comprising 9.4% of the Tharisa basket.

Spot palladium prices averaged USD993 per ounce in Q1 FY2018, ending the calendar year at USD1 057 an ounce, while spot rhodium prices averaged USD1 351 per ounce in Q1 FY2018, ending the calendar year at USD1 470 an ounce. Spot palladium prices increased 58.0% and rhodium prices increased 52.6% in 2017.

Contracted metallurgical grade chrome concentrate prices increased 4.1% to USD179 per tonne from USD172 per tonne in the previous quarter due to improved liquidity and consistent stock levels at ferrochrome and stainless steel producers in China. Current metallurgical chrome spot prices are above USD200 per tonne for February 2018 shipment.

As at 29 December 2017, Chinese port stock levels were at 2.2 Mt, or approximately two months' supply into the ferrochrome and stainless steel industry. The market fundamentals for chrome remain sound with continued growth forecast for the global stainless steel industry.

Specialty chrome concentrates, which comprise 24.1% of Tharisa's total chrome production, continued to attract a premium above the contracted metallurgical chrome concentrate prices.

EV/EBITDA =3.1. The lowest among profitable mines, indicating upside potential in the share price..

 http://www.tharisa.c...resentation.pdf

Been a stunning share for us so far

Based on the improved earnings, the directors of the Company are recommending a final dividend for FY2017 of USD5 cents per share, reflecting a material increase on the maiden distribution of USD1 cent declared for FY2016. This will be put to shareholders for approval at the AGM to be scheduled for January 2018.

Furthermore, Tharisa notified its shareholders that the dividend policy for FY2018 will be changed to provide for a payout of at least 15% of consolidated net profit after tax, an increase from the previous stated dividend policy of at least 10% of consolidated net profit after tax. The Company also intends to introduce the payment of an interim dividend. 

R25 million savings in operations:

https://www.hiresa.c...et-performance/

I am slightly concerned about the slowdown from H1 to H2, despite the fact that y-o-y the earnings are growing.  But undervalued compared to the mainstream names.

“I don’t think at $200/t there is an incentive price to bring fresh, new production on stream, but it is a price that will provide a healthy margin for existing producers,” said Pouroulis in October.

Pouroulis told Miningmx the company was considering “a generous” adjustment to its dividend policy in view of the likelihood of an improved financial performance for the year. “We have discussed a new dividend policy,” he said on the day annual chrome production for the year came in at 1.3 million tonnes (Mt).

I am slightly concerned about the slowdown from H1 to H2, despite the fact that y-o-y the earnings are growing.  But undervalued compared to the mainstream names.

14/11/2017

Tharisa - trading statement

Tharisa is currently preparing its financial statements for the financial year ended 30 September 2017, with the financial results expected to be released on or about 30 November 2017.

Shareholders are advised that with the solid operational performance and the increase in the chrome concentrate price, Tharisa's basic earnings per share (EPS) and headline earnings per share (HEPS) for the year ended 30 September 2017 are expected to be between USD21 cents per share and USD23 cents per share compared to the EPS of USD5 cents per share and HEPS of USD6 cents per share for the year ended 30 September 2016. 

From Chromium 2017 conference:

http://www.miningwee...ears-2017-11-10