Sapan Gai, CCO at Sovereign Metals, discusses their superior graphite test results. Watch the video here.
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Likewise Moneyman thanks for your numbers. Reassuring that you have a similar number.
For "speciality" chrome the 75.4k that you mention for Oct 2022 to March 2023 is somewhat of an outlier. For Oct 2021 to March 2022 it was 176.4k, for April to Sept 2022 173.1k and for April -Sept 2023 147.8k. So for Oct 2023 to March 2024
I am expecting 160k. Speciality chrome sells for a $30 to 40/tonne premium compared to metallurgical chrome so an extra 10,000 tonnes of speciality chrome rather than metallurgical chrome would increase turnover by $300,000 to 400,000.
Thanks Mike-my broad calculations came out with a PAT figure circa $45 million -in the same ball park as yours .
Compared to the six months ended 31/3/22 there appears to be a significant increase in “speciality” grade chrome -136.kt compared to 75.4 kt
Moneyman, I agree and we will find out on 23rd May.
1. I am expecting H1 turnover of $342m (PGM 78/chrome 239/agency 23/manufacturing 1.7). I am expecting those "speciality " chrome grades to be steady.
2. We already know that in H1 the Company milled 709,300 tonnes more than mined (over 25% of the milled total) which assuming no stock adjustments is roughly the "bought in" materials for processing that you mention (this is included in the "cost of commodities" in the overall Cost of Sales), likewise in H2/2023 the same number was 544,600 tonnes. So the H1 Cost of Sales will include the cost of this bought in material. I am assuming total costs of $286m (Cost of Sales $257m , other operating expenses $29m, other net costs zero) .This gives PBT $56m, total PAT $43m , PAT attributable to shareholders $41m.EPS 13.6 cents, HI dividend 2.25 to 2.5c. It would be good to know what others expect!
3. Karo capex should be steady until the ring fenced financing is in place which will probably delay the project another year into 2026.
Not long until an indication of results for the period ended 31/3/2024.
Be interesting to see
1-Turnover figures -how this has been impacted by “speciality grade “ chrome
2-the amount paid on “bought in” materials for processing which materially adversely effected the gross profit percentage in the previous period.
3-the amount of capital spent on Karo
The platinum price has gone above the palladium price this week, it will be interesting if it stays that way.
Hi Manyaana, I have mentioned Salene before but no information was forthcoming and in the current lull Ilja is not allowed to comment until the H1 accounts are out on 24/05. As you say, the Zim government introduced an export ban to encourage the added value to stay in the country but it probably just allows the domestic ferrochrome producers to buy at lower prices if they do not have to compete with the Chinese export market (intriguingly there is a small amount of Zim chrome concentrates sold in China so I am not sure how it gets out). There was discussion of a similar export ban in S Africa but they have gone in a different direction.
If I remember rightly, Salene was a relatively small scale operation based on 80,000 tonnes/year high grade chrome concentrates with a relatively small LOM of 7-10 year, but 80,000 tonnes at say $400/tonne would give a revenue of $32m/year which would probably generate a profit after tax of say $8m/year. Instead it is currently mothballed but still held in the Tharisa accounts for a rainy day. In their analysis 2 days ago, Tamesis gave Salene a risked value of $48m.
Likewise I would like to hear more on the smaller open pit possibly starting to transition to an underground mine as early as 2025 or 2026 and what this will do to overall chrome production and costs at Tharisa over the next 3 to 8 years.
Salene Chrome was commissioning, with production due to commence in Q3 FY2022 when a Government Export ban on Chrome concentrates resulted in the the Plant being placed on "Care & Maintenance" pending a review of the ban and the Business Case.
With Chrome prices at their highest since this Export ban was introduced, I assume Tharisa are keen to address this ban with the Zimbabwe Government, because it must have hit our potential revenues and Share price massively over this last couple of years.
I can't believe this has not been discussed more on this Board. Why was the ban on exports introduced? How long is it expected to last? What is the future for Salene Chrome?
It's about time Tharisa gave a comprehensive update on Salene Chrome.
Slow steady rise continuing after Q2 figures.
Metal prices up again this week.
I for one am very happy with the buyback, Tharisa is a thinly traded share with low volume so 5million buyback is a plenty, particularly given the investment need in Karo. I bought more posted here at 48 and 52 after a number of people on these boards worried about Karo and the price took a further tumble; a combination of a bit of PGM recovery and buyback has increased those by new shares by 40% and a third so can’t complain. The daily buyback amounts can’t be huge given volume.
We don't have to anounce when and how much we buy back under JSE rules, but will provide an update when approprttae, let's just say there has been more buying.....
I've heard of slow and steady wins the race, but a buy back of 427 shares a week might take a bit of patience!
Closed period till 24 May, so can't really add anything to the strategy outlined, Chrome parcels selling for 305 depsite stainless steel weakening, the PGM mkt was disected in the media follwing the PGM Industry day here in JHB on Wednesday, so all the latest is there
Overall, that was an intriguing update from Phoevos. Buoyant few years ahead. Some further insight from Ilja would be welcomed. Vasbyt.
10-Apr-24 Berenberg Bank Buy reccomendation - 130.00 Reiteration
JWBellamy "Back into the 50s today"
Only an hour to go 🙄
Palladium getting battered today
Reef milled and PGM production were marginally up on my expectation which are all the better given that the stripping ratio deteriorated to 14.0m3:3m . The chrome number is a little disappointing but I take the comment from Ilja at face value if Vulcan has been down for maintenance/repair and I see the Cr2o3 ROM grade this quarter is only 18.1% compared to 19.1% the previous quarter which is 5.2% lower which just reflects the grade we are digging out of the ground this quarter just happens to have a lower chrome content plus we are still having to buy- in about 25% of the ROM we are milling and I suppose that is variable depending on where you buy it in from. The Company has said that it aims to stop having to buy-in ROM by the end of this year which suggests reef mined should get back to the levels of 18-24 months ago. As Stemis has mentioned below, the Company is still on target to achieve the guidance numbers for the FY. So just a minor blip.
Yes, the cash is lower than expected but let us wait for the full H1 numbers to see where it has gone.
No - people never look at the numbers or as I noted this morning on another stock - actually read the RNS.
Do people even look at the numbers? Q2 is normally a lower quarter for production numbers. Chrome production of 402.7kt is almost the same as 2023 - 404.8kt. However, in the first half of 2024 as a total, chrome production was significantly higher than the same period last year; 865.6kt v 787.9kt. Company has re-iterated guidance for full year of 1,700-1,800kt, which compares to 1,580kt last year. So NO drop in chrome production.
Nice to get feedback from the co(ths) . Seldom get that from other companies.
Appreciate that they want to be involved with PI`s
Planetsaligned, as explained this is just the second quarter figures . A period when plant is maintained which is necessary but causes downtime and results in lower production.
Cash is down but still very healthy at $70mil given they pay a divi, and are using cash to finance karo and now spending to buy back £5mil of shares. Tharisa wouldnt undertake that without a healthy balance sheet.
As is grade due to feedstock, Vulcan is doing well but maintenance has an impact on overall recoveries
Vulcan was supposed to increase Chrome recoveries to ~82% but the recoveries for the current quarter are far below that at 66.4%
Those details will be in the financial report on 24/5, needless to say we continue to spend our portion on Karo, net cash remains strong with Karo holding good cash that will allow them to continue development as per our revised timeline, remember this is q2 where we do major maintenance in the plants with downtime for some days during that period in the planst never mind a short February