Member Info for Mike1959

Looks like the chrome price is down $1 to 2/ tonne this week.if the current PGM and chrome prices and USD/ZAR continue on an annualised basis the Profit After Tax could half in the current year compared to FY Oct 23 to Sept 24.

PGM prices will increase but the speed and

intensity really depends on current stock levels which is a massive grey area.

Personally I see the PGM basket increasing say $100 to $200/oz in the next 12 months which would not make up for the current dip in the chrome price and probably a $200 increase is required (along with the required external funding) to allow Karo to start producing.

Chrome is still relatively strong and will bounce back when the economy in China improves

Nothing yet on the Chariot/ Total Erin solar farm which should have started in the middle of the year.

Hi Sotolo, we do not know the source of the PGM information given by ilja and he did not comment further when asked by Ian B. There were a few errors in there but it was very useful at highlighting the current PGM deficits that most people seem to be ignoring.Just on platinum, Johnson .at they suggests a deficit of 598,000 oz this year,Heraeus 620,000 and the WPIC over 1m with deficits to continue in the next few years. The major point I liked that was made by Ilja was that current above ground stocks are not just refined PGM but includes pgm concentrates that would take 3 to 4 months to process into refined pgm ingot.You are right to question the demand side

for ICE but there is growing evidence ce that the tail will continue much longer than expected.

Also there are questions about the level of above groundstocks particularly in China,dark Pd and Pt out of Russiabeing sold to China/India and physical investments (check out PHPT on the LSE),also if pgm prices do increase then undoubtedly pgm production will start to increase agian.

In my post below I did not say that pgm prices would increase but that they " need" to increase to make up for the recent shortfall in the chrome price. Personally I do think the pgm deficit will increase pgm prices but that it could take another 6 to 12 months for this to happen as the market has to see that the growing deficit is real and that ICE demand is not going to drop over the cliff yet a nd even then will the hydrogen economy catch it.

I am less concerned about chrome which is not facfacifacfacinfacfacifacfacing a structural change like pgm. Yes, China is quiet at the moment and is just returning from a week of holiday so that port stocks have built up but the future growth will continue and only S AFrica can supply in the required volumes.

Hi money man and other contributors below. I agree with your general consensus, another very solid set of numbers, particularly net cash.Good to see comments on bigger Redox batteries in test;chrome alloy (although probably very low volume); transition to underground mining at Tharisa.

I make it PBT $116m, PAT $ 86m, profit attributable to shareholders $85m, final dividend 3 to 3.5 cents (H1 1.5c), PE 3.2. The netcash of 109m now represents a massive 40% of the market capitalisation so it has to be invested wisely so that Karo must bedelayed further until the additional finance is in place and the PGM basket recovers to profitable levels.

Looking at the new financial year the recent 3-4 week drop in chrome from $302.5 to $275/tonne would need the PGM basket to increase by over $400/oz just to make up for the reduced chrome revenue on an annualised basis so we really need the PGM basket to take some of the strain or the chrome price to edge up again.

Hi Sam, yes second hand vessel values are still historically relatively high but by my numbers 10 year old Supra/Ultra valuations fell 0.8% in September and Handys fell 3.3%.

I have considered Tufton (SHIP), they are slightly smaller than TMIP and likewise are a relatively new company, they have a more varied range of vessels (over half are tankers rather than bulkers) and their average time charter is between 1 to 2 years compared to under 1 year for TMIP. Their chemical and gas tankers seem to be more profitable than TMIP's bulkers and they have had some share buy backs and lower debt hence they

have a lower price discount to NAV. What put me off was that I could find little information about their individual vessels.

The NAV forJune to September is released on 25/10..Time charter rates and vessel values came off in the last 3 weeks of September so i am expecting an NAV of around $1.57/share, up from $1.52 at the end of June but down from the$1.596 post SCR.

The current share price is still at a discount of 35% to 1.57. The good news is that the BHSI and vessel values have started to creep up again after the end of the Quarter.

.....I should have said the chrome price has fallen in the last 3 weeks from 302.5 to 275.

Guys, I agree with your last 3 comments but I think the biggest factor is that the chrome price is down from $302.5/tonne to $275/tonne today based on those numbers and annual production of say 1.75 million tonnes that reduces annual sales by $48 million.

Thanks Moneyman, I am expecting the numbers at the lower end of the guidance, chrome 1.702 million tonnes at an average price of $299/tonne,PGM 146,000 oz at average price of $1366/oz. Reef mined 4.658 million, Reef milled 5.634 million tonnes.Net cash $90 to 100 million.

....so any predictions?

I agree that sounds incredibly encouraging for PGM prices next year.

Unfortunately the average September chrome price has dropped below USD 300/ tonne to a 6 month lowand according to Ferro AlloyNet on Monday " a large chrome ore supplier in S Africa concluded chrome concentrate 40-42% at USD270/tonne bulk shipment CIF China with long-term contract customers".

Hi Sotolo, I would not say the Tharisa and Karo basket prices are rising, they are down from a month or so ago.

....sorry, just realised you are talking about SLP rather than THS.

Hi Ian, the chrome price is down a little this week. But I disagree that the production numbers will miss the targets. For Q4 I am expecting PGM production of 37,900OZS or 145,800 oz for the full year , the Company target is 145,000-155,000 oz so just in. Then for chrome I expect 426,000 tonnes for Q4 or 1.702 million tonnes for the year , the Company target is 1.7 to 1.8 million tonnes so again just in. We will find out on 10th October.

In the H1/2024 financial statement, so as at 31st March 2024, Tharisa PLC owns 75% of KMH for an equity investment of $135m . On checking again I see the VFEX bond was increased from $32m to $36.8 m although this will expire in Dec 2025 and will probably require replacement finance, even if production starts in June 2025 (in my opinion unlikely), it will be a low start and gradually ramp up to targeted levels.

The useful presentation you highlight below does mention balance funding from working capital , prepay gold stream, subordinated shareholder loans, junior debt equity like investments and other Zimbabwean funding but if all seems rather vague particularly at this stage. Tharisa has already said we will cover the working capital. Even if a prepay arrangement for say gold is found , this would be at a discount to the gold price and just means the overall basket price is lower.

Also as noted in the H1/2024 financial statement , Karo was originally given Special Economic Zone status with a reduced 15% corporation tax rather than the usual 24.72% , but subsequently the SEZ legislation has been amended to exclude mining companies. Tharisa is fighting this and expects a favourable outcome but if not achieved this would be another nail in the Karo coffin.

Hi Hxulcolrdoh, you know that I agree with much of your criticism. We know that the delayed Karo project will now cost around $430 million (previously $391m). Ilja told us here on 22nd Feb "the total investment by the Company [Tharisa] in acquiring its current 75% shareholding in Karo Mining Holdings is US$135.3 million" which I assume is your 43 cents/share . But on top of this $135.3m I believe we will invest $65-75m increasing the shareholding in Karo to 80% this month (a similar sum will be spent on project expenditure this year) plus eventually around a further $33m taking the total investment by Tharisa in Karo to around $238m. which caps the Tharisa investment and equivalent to 79c/share. To get to the total project cost of $430 m, $32m was raised by the VFEX Bond at a hefty interest rate (anyway one -third was paid the Tharisa) the balance of $160m will be funded by external ECIC supported investment ring fenced against Karo which has yet to be agreed. If my suggested figures are wrong then I stand to be corrected.

At the current Karo basket price the full scale Karo project cannot start and the investors for the $160m are not in place. So you are correct that the project is a big gamble. Delaying the full Karo start-up will increase the costs even more. If and when PGM prices recover then the Karo project could still come good.

Fortunately the Tharisa mine is doing well but without having to spend 79c/share on Karo and nothing to show for it yet except assets on paper, or possibly in the future, we could have been doing far better.

Hi Sotolo, the buy back has been a wise investment of shareholder funds and helped to propel the share price upwards.

So the buyback ending cannot be good news for the share price and I do not expect a new buyback announcement although many would like to see it.

Hopefully with the immense potential of Redox One, the new electricity deals and the renewed commitment of the board to financial prudence that there is more support and resilience in the share price. The chrome price has slipped off a little recently but still historically strong, PGM prices are still in the doldrums, while the weaker USD relative to ZAR will increase H2 costs by over USD 5 million compared to H1 so I would not be surprised to see the share price fall a few pence in the next few months. But I am hopeful of good Q4 and full year production figures being announced in October. Although I think H2 revenue will be slightly lower than H1, with considerably lower bought in ROM I expect the Profit before tax to be higher in H2 than H1 and about $117m for the full year, H2 dividend of 3.5c (after 1.5c in H1), further delay in Karo and updates on the Tharisa mine starting underground investment. The prospective PE of 3.7 still looks very cheap. With PGM profitability in the wider sector continuing to be decimated then prices could recover in 2025. So I remain cautiously optimistic.

With todays RNS I reckon the buy-back is now 95% complete and will possibly be complete by the end of this week

Sam, I agree on the vessels, assuming we are down to 36 vessels my calculation is that like for like vessel values are up $9.6m since the start of June. But we need an average TCE of around $14500/day to breakeven at current debt/dividend/operating expenses with no change in overall vessel values. At the end of June we were told the average TCE was $14707/day and I expect currently around that $14500/day level.

If we did not have any further changes to the TCE or vessel values this quarter then I believe the NAV at the end of September would be about $1.62/share ( compared to $1.52 at the end of June) which is a 36% discount to NAV at the current share price.

Hopefully vessel values will continue to strengthen, interest rates fall, TCE's continue to grow, synergies post SCR continue to reduce operating costs so that we see an even higher actual NAV at the end of September.

As mentioned many times before , really strange trades today.

Considerably more sells than buys , a dozen sells between 9 to 10 am today totalling exactly 470k, yet the share price is up on the day!

Oufc, don't worry we all do it!

IanB, the share buy back was for up to $5m , based on say $/share that is 5m shares. As of yesterday the cumulative share buybacks on JSE and LSE were 3,467,885, so that is about 69% done.