Member Info for NorthernShark

AB, to be clear I am not questioning your basic premise of the PGM basket rising as it is absolutely valid where we sit at this point. One other point to note is we haven’t sold anything as yet, and the SP should reflect the economics! Look north I would suggest

AB, basket price does not equal margins as there are toll processing fees etc… the JV as announced is only a 50:50 on margin. Who knows how long the price will stay where it is. Lots of rhetoric right now, let’s wait for the circular before making any conclusions!

Exactly the point! Slater heavily under water and has influenced the FD selection. He will not vote to give away SA unless there are concrete moves in Zambia - he is not stupid! Let’s see what the circular brings…

Actuary, the boards are pure speculation at this point. Production numbers especially from Roan, drilling results from M and G plus the granular transaction details are required before making any decision. Intuitively the deal does not look great given the recent rise in PGM basket price but let’s see the detail before jumping to conclusions. The FD is a key part of this given his connections to Slater - who isn’t going to sell anything on the cheap unless the capital can be deployed to achieve a much higher return in the copper space.

ATB Northern

Thats the key point I think Seis - how long will the current pricing last?

If we keep the PGM containing stockpiled material as part of the deal then alongside Tjate it allows JLP to keep any upside potential in PGM pricing.

The detail of the deal matters and nobody will know this until the circular is released.

Kalan, there are two JV's for processing the PGM. No reason to suspect the newer one isn't operating as per the RNS. The original one is bigger in terms of capacity and a better split of the profits hence the interest in whether that is producing.

Blue, a second PGM plant would be expensive and apparently has been looked at previously back in 2023 but stopped as the price dropped significantly.

The route taken for the PGM stockpile is to process via joint ventures. The existing one (Northam I think) has a large capacity and I am personally surprised this hasn't been activated given the size of the stockpile and the recovery in the basket price. Earnings split is also more favourable than the 50:50 split at the new JV and the capacity is much larger. There are also some tailings on the Eastern Limb which may be worth looking at processing now, albeit this had a higher Rhodium content.

ATB Northern

Papaki, are we not putting the cart before the horse. We need to wait for the circular to see the finer points of the transaction. Jumping to conclusions at this stage would seem premature unless you are party to information not in the public domain.

ATB Northern

Edzi, shareholders will get a vote. Post circular I will review the information as it is presented and form my own opinion and vote accordingly. It will not be too late as the vote has not happened. The "sophisticated" investors such as the institutions will make their own assessment and presumably identify any anomalies within the report and vote according to their findings. Simple process - if shareholders don't like the deal vote no, if they do then vote yes.

Gray, I do get it as trained as an accountant. My point is this is all past performance. Many companies spend years building before it translates to the bottom line - Amazon would be an example of this. We have built the assets, contacts and IP, now it is about execution. Volume through Roan and volume through Sable will equal plenty of profit. I fully appreciate this is taking longer than originally envisaged but now is not the time to throw the baby out the bathwater. You want a steady earnings company then I would suggest going back to the FTSE you know so well

Gray, hardly flying off at a tangent talking about depreciation but the broader point is accountants have latitude for creativity when it comes to numbers and timing. You are correct the entity is loss making at a net level and I am correct that it is profit making at a gross level - happy?

The broader point is what are we doing now. Mistakes have undoubtedly been made and not to be ignored when making your own mind up on how to vote. This is what I hope comes through in the circular and contrary to what others may think I believe the new CFO will put in numbers based on current facts - why - because he is Slaters man and not Leons puppet. He also has a fiduciary duty to shareholders.

Gray, you can use the numbers to suit your narrative and thats fine. If you want to include non-cash elements like the depreciation and tax piece then lets revalue the OB1 project based on the sale of the 10MT. Hey presto a massive paper revaluation profit.

Fact is the operations were shut down for a decent chunk in H1 and a one off contract adjustment, neither of which should happen in H2. So operationally the Copper operation should be showing a decent operational profit and will only improve with time.

Main question is where should the focus be - on the past or how the operations are performing now and into the future?

ATB Northern

Gray, your statement is incorrect.

Even with the stoppages the copper was profitable at a gross profit level. In addition, the sale of 10MT from the OB1 material for $6.75m will generate a significant profit. So copper as an entity is not loss making.

What is more important is where we are now and projections over the short-medium term with Roan operating in a steady state position. I would expect this information to be fleshed out in the circular. We know as production increases that the profitability naturally goes up as the fixed costs are spread over more units.

From the financials released 31/3/25

- Copper revenue up 5.1% to US$8.3 million (H1 FY2025 US$7.9 million).

- Copper cost per tonne increased by 30.6% to US$5 948/t (H1 FY2024: US$4 554/t), due mainly to a once off contractual adjustment of US$573/t (accounting for 12.6% of the increase) to the price of copper ore purchased during the period and the impact of plant stoppages due to power constraints.

- Copper gross profit down 88.0% to US$0.3 million (down 53.6% excluding the once off contractual adjustment) (H1 FY2024: US$2.5 million) driven mainly by the commissioning of Roan operations and subsequent stoppage due to power interruptions.

- Copper gross profit margin of 3.9% (14.0% excluding the once off contractual adjustment) (H1 FY2024: 31.7%).

ATB Northern

I agree about the mining partners - they have expertise, people and supply chains which JLP would need to put in place. Why wouldn't we focus on our specialism of processing?

On the point of it being rushed I disagree. The formation of two seperate boards clearly indicated this has been a potential move for some time.

The specifics of the transaction will depend on just that - the specifics which we will only see in the circular. Anything until that point is pure speculation.

Zambia rollout - some have asked about the proof the copper strategy works and thats a good point. Sable as we know has been operating for some time so no worries there. So that leaves Roan. We know the 8 week trial produced 375T of copper and by the time shareholders have to make a decision there will have been another period of full production which will add confidence around the capabilities there. The leaching process has also demonstrated ability to extract copper from the low grade material.

Small scale mines - already in talks about two more but the economics based on Munkoyo so far, and I expect much more to come mean this is rightly a focus.

If the deal stacks up (CIRCULAR!) then I think it is a great move.

ATB Northern

Edzi, I can assure you I am a private investor with no links to the company. Others on this board whom I met at the AGM will corroborate this.

Others can confirm the conversation at the AGM about the stockpiles - it is a linear path with the growth in chrome - and was always something I wondered about - and was confirmed at the AGM.

Question is why would we give this away as part of the deal? Makes no sense which is why I await the circular

HD, it wasn’t in an RNS but was spoken about at the AGM. Not been drilled so not JORC but they process the stuff all the time so they know what’s in it

Edzi, with respect I don't think we are all saying the same thing and the small print is absolutely vital as currently people are forming opinions without the relevant facts. These facts will come out with the circular as will I suspect more granular details on the copper strategy.

In terms of the proposed sale I would potentially vote for this if it excludes the PGM material we have stockpiled. We can then activate the Northam JV and process this over the next 7-8 years which will give up to 100k ozs per year which gives us continued exposure to the PGM upside in the medium term. Selling this material as part of the deal would not make sense at the proposed price.

In terms of Zambia, they have been quite clear that Roan works with this weathered oxide material and have produced 375t over the 8 weeks which involved trialling different material. I fully expect the numbers put forward for Roan will be exceeded as this has been the way under JMK.

The potential mining partner makes sense as we are not a mining company and focuses our attentions onto what we are good at which is processing. Historical returns from the Zambia operations are to a degree irrelevant - it is what is happening now which matters and as production increases the margin per unit increases as the fixed costs are absorbed over more units.

OB1 has demonstrated JLP ability to identify assets massively undervalued by the market and if the sale of the SA assets accelerates the implementation of modules there then I would be delighted. Munkoyo is similarly a great purchase given forecast production numbers when the leaching is in place - I would expect G to be similar.

Long term prospects for copper are also very solid. If JLP are valued as a pure fast growing copper play then the PE ratio will be much higher than having a combined PGM/Copper business.

So strategically there is a strong rationale for the transaction and is certainly not "the last throw of the dice". The detail of the transaction DOES matter and if it transpires as I have outlined above whereby we keep the PGM material then I would almost certainly vote for it. Zambia is the future of the company and just because they have made a number of errors to this point, does not mean they can't execute the future strategy.

I await the circular in a week or so and will firm up my opinion on the back of that, as I would encourage all shareholders to do.

All the best, Northern

AB, the grade doesn't matter in terms of the sale proceeds per unit. What matters is the split between copper cathode and sulphide concentrate. The higher proportion we put through Sable to cathode the better.

ATB Northern

I would expect copper numbers to support the Circular as it all forms the basis of the investment decision for shareholders. Not long to wait and can argue the toss based on published numbers then.

Welcome Papaki, I follow your posts on LinkedIn with great interest and you obviously know the local markets very well.

One thing we have to remember is we don't currently know what is being sold or the terms of the deal so a little early to conclude one way or the other. If for example we keep the PGM waste material (circa 1m tonnes+ mentioned at the AGM) and process this via the existing JV over time then this brings a different dynamic to the valuation.

The circular will provide the detail we need to make a fair assessment.

ATB Northern