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As we all were expecting, it's a great set of results and I've rejigged all my PGMs & Chrome All-in-cost per oz calculations so they're up-to-date below. There has been an increase in cost of sales, but if you analyse it on page 30 of the report, this is due predominantly to royalties to SA Gov (factor of increased PGM prices) and inflationary factors (commodities, consumables costs increases) outside of THS control, which all producers will experience.

Before I dive in to that, on top of the $30m Net Cash position, analysing the Trade Receivables minus Trade Payables, you can also see a huge balance in THS favour of $77m! Adding this to cash position, it totals some 20% of THS market cap.

a) PGM Revenue: 193.3m
b) PGM Cost of Sales: 96.8m
c) PGM Production: 75.1k
d) PGM Basket Achieved by THS ( (a) / (c) ): $2,574 per Oz
e) PGM Basket Reported by JM: $2,976 (simply monthly averages from JM website)
f) PGM All-in-cost per Oz ( (b) / (c) ): $1,289 (Forex 15.3 used in Interims)
g) PGM Discount to Spot ( (e) – (d) / (e): 13.5%

a) Chrome Revenue: 102m
b) Chrome Cost of Sales: 71.9m
c) Chrome Production: 730.7k
d) Chrome Price Reported: $145tn
e) Chrome Price Achieved ( (a) / (c) ): $140tn (only 5% less than above)
f) Chrome All-in-Cost: $98tn (Forex 15.3)

Cost of sales includes D&A, impairments etc. so when using these costs to work out a “per oz cost”, it is far more all encompassing than “AISC”, but actually more “All-in-cost” (inclusive of SIB Capex, as D&A costs largely mirror the annual SIB Capex costs).

Edit: got cut off at end. Meant to end with "an owner operated up-to-date yellow fleet". Major hugely beneficial change from contractor model.

The softening of the price of Rhodium was bound to happen due to the issues the autos sector is experiencing with semi-conductor shortages, with the trigger likely being all commodities getting ahead of themselves and China's threat to curb commodity prices (not that they can do much on fundamental industrial demand side, but can curb speculation + state loans in their own country to cool economy). Most auto makers kept ploughing on for as long as they could, with now large inventories of completed cars just awaiting semi-conductors. But whether it was ZH or mainstream news outlets, there were multiple stories of auto makers slowing down factory output. As much as I hate this word, I do believe this is "transitory" though in medium term and don't buy some of the gloom here on using the past to predict the future (what goes up must come crashing down to its original price point).

Sometimes events occur that completely change the fundamentals of a market, that past performance becomes redundant: a) Dieselgate for Platinum; b) new stringent emission standards in US, Europe, China, India etc. increasing PGMs loadings in CCs, coupled with a continued industrializing Asia & Africa completely changing PGMs demand dynamics, compounded with supply issues in Russia and SA (underground mines getting deeper, more dangerous, more issues etc.) c) perhaps the next shift could be a hydrogen economy/ fuel cells car adoption and other new industries for Platinum, Iridium and Ruthenium. We already see this if the latter 2 price movements are anything to go by.

We have had a structural deficit in palladium for years now which has led to a new higher "norms" in the $2,000+ and can't see this changing anytime soon - over-ground palladium supply in ETFs and Russia stockpile has dwindled. I think from all reports we see this now in Rhodium with major long-term chronic structural deficit and a 20% increase in output this yr, which may or may not occur, will still not solve the long-term demand-supply deficit, leading to a new "norm" of higher Rhodium prices - there is also little "overground" supply to plug any shortfalls. It could of course get choppy in short-medium term though as demand falls due to semi-conductor shortage, but this should be “transitory” (sorry hate that central banker speak word, but unlike inflation, I do believe semi-conductor shortage will be resolved - it has to be, the modern world relies on these chips for everything now).

HG - it's incredibly hard to find current ownership of Samancor but believe you are right - IMR Group (the 3 Kazakh Oligarchs) appear to have sold their 60% odd stake in Samancor to a Consortium of 3 Chinese state backed companies you refer to: Sinosteel, Mins Metal and China National Investment Corp. IMR Group used to hold their 60% stake through a vehicle called "Terris Chrome" which had very convoluted ownership of other Terris entities. Hanwa also had a small ownership stake in Terris, as well as a direct ownership in Samancor outside of Terris adding up to 19-20%. Not sure if Hanwa still have this stake, but believe they may do. The BEE of various entities also of course own 24%.

The big issue related to SLP is who the hell now owns "Africa Asia Capital" (AAC) who own 20% of SLP, albeit have been reducing their stake. IMR Group used to own AAC (i.e. Samancor) and they may still do, which may be in conflict with new Samancor owners.

Going back to TBTT's point, the original owners of Samancor I think actually got a very good deal from the Samancor-SLP relationship, albeit it was at least symbiotic. They got chrome for free, a small % of the PGM profits (effectively a royalty) and 20% share of SLP itself. On the other side of agreement, SLP spent millions on Capex, IP etc. to develop the SDO sites. However if Samancor new owners do not own AAC and therefore have no share of SLP, long-term it could spell trouble and a re-negotiation of commercial agreement. It's also bit concerning AAC have been selling.

For many reasons stated on the this board, for me THS is by far better bet. On a 6E basis:
- SLP produce 90-100K 6Es versus THS 160k PGMs, moving to 200K PGMs over next couple years.
- THS produce 1.5MT chrome, moving to 2MT chrome annualized by Oct 2021.
- THS is more profitable and cash position should soon catch SLP's $102m versus THS' $31.4m on a "like for like", albeit THS have far more growth opportunities and will spend cash on this too.
- THS has 14yr open pit mine life (could be extended if they continue to optimize), followed by 40yrs underground. SLP have 8-10yrs operationally dependent on Samancor. Commercially who knows as the SLP-Samancor commercial agreement is opaque and who knows if Samancor have change of heart to renegotiate.
- THS dividend even on a 15-17.5% NPAT still provides better yield than SLP. However now THS is Net Cash, I do partially agree only now with some criticism NPAT % should probably be recalculated to at least 25% NPAT. Previously THS had debt pile and capex to contend with. Now Debt is very small and THS are Net Cash, we're in a whole new world and whilst this may not be changed in Interims, FYE Sept 2021 Accounts presentations etc. I would hope they relook at the dividend NPAT %. I do find some impatient criticism bizarre though - it's because of THS investment in growth we have a soon to be annualized 2MT chrome, 200k PGMs, other major growth prospects and an owner operated up-to-date yell

Karo Resources PGM is a monster asset, but the Capex is not $4bn, not anywhere close. THS have said a number of times the news media misconstrued / confused numbers. The $4.2bn figures comes from news reports stating the asset is "valued at $4.2bn", not that this is how much the Capex will be.

Like Salene Chrome and Tharisa SA, I also expect THS will develop phase by phase. Open pit, expand and then underground. Whatever their strategy will be, we're expecting a Feasibility Study soon this year.

When you're financing a secondary asset and the lender has collateral against your primary asset in event of default, yes of course it does not need to be fully funded on Day 1 - just needs proper stress tested plan that it can easily be funded over the course of development, with contingency. It may mean Coris or other potential lenders will demand the same high % (8-9%) as it did for Yanfolila in terms of risk profile though of course. I guess we'll find out soon enough... In any event the Guinea Government could still throw a spanner in the works - the significant delay on approval is becoming quite concerning. Face-to-face meetings with "officials" can always be quite fraught in some countries too, to "facilitate" completion. Let's hope it all goes smoothly...

I'm by no means bullish on HUM, very much the opposite, but you do realize they don't pay $100m on Day 1 of obtaining license approval for Kouroussa???!

From getting the license to completion of commissioning, it's at best 18 months process of which the $100m is spread across, most back-ended through construction and invoices will be in trade payables even after completion. So if they get financing of $60-70m in the 1st phase as planned, there should be no trouble.

To suggest at this early point they need equity is quite absurb. HUM have $5m (incl gold inventory) and are muddling on with adding $3-4m free cash per Q (until there is clear grade improvement i'm not in the bullish camp expecting any better on this). The Mali Gov still probably owe HUM around $8m too (although need to see Accounts to confirm this). The VOX Q&A did nothing to clarify why Betts think grades will improve when HUM's own MRE states a quite terrible 2.07 g/t for Komana West, the pit now being mined. If Q2 doesn't show improved grades and only hits the MRE of 2.07 g/t at KW, then I might change my opinion on FCF versus equity raise for Kouroussa.

Dugbe will be a bigger issue as this already has a very meaty royalty on it and the capex is well in excess of $250m if Pasofino go with their bigger aspirations of 200-250k oz p.a. (with gold grades of Dugbe, < 2 g/t, large scale is only thing that makes sense). I can't see how HUM will possibly make a finance decision on this in early 2022 when Pasofino have completed a DFS. I can't see a lender providing credit once HUM are tapped out on Kouroussa and with all free cashflow going there.

The other elephant in the room is of course how they will fund going underground at Yanfolila... So at present I can't possibly see how they progress financially with Dugbe once Ian Stalker has his ducks in a row

Ore mined, processed (1.38m annualized) continue to be even better than anticipated in comparison to the DFS when normalizing for additional ball mill + recoveries are pretty much meeting expectations (93-94%) , the continual problem is grade (2.16g/t for Q1 2021)... and grade is king. In this Q1 2021, we knew the grade would be below expectations so that isn't too much of an issue and they even improved Net Cash position by $3.4m which was better than many of us expected (not as good as others expected mind you), albeit they don't specify how much was spent on Development Capex + Exploration in the Q, although would guess it was only round the $3m mark.

The big issue moving forward though comes from the MRE released on 30-Mar. Focusing on Komana West which is now the new pit to be mined:

a) In original DFS, KW had probable reserves of 239.2k oz @ 3.06 g/t. Probable reserves being economic part of Indicated, with lower level of confidence than a Proved Ore Reserve.
b) In Reserves update of 17 December 2019, KW grade was downgraded to 239.0k oz @ 2.53g/t probable.
c) In the latest MRE of 30 March, KW is now 390k oz @ 2.07g/t Indicated. No explanation...

Key question for any VOX interview is how will they improve grades in 2021 and thus production when their own new MRE for KW shows 2.07g/t?

1.4m ore processed x 93% x 2.07g/t / 31.1 (troy oz conversion) = 86,660 oz.

If we were to be generous and assume that the Probable reserves mined actually beat expectations compared to the new MRE for once:
1.05m ore processed (3Qs) x 93% x 2.53 g/t / 31.1 = 79,439 oz + Q1 22,781 = 102,220 oz

When ore processed + recoveries can't really be improved on and hit their limits, the only variable to play with is grade when trying to calculate potential 2021 production. I really hope VOX Q&A isn't another low-ball fluff piece with no difficult questions...

Mike - thanks for detailed insider knowledge on commercial side of contracts between likes of THS and their refiners (Impala and Sibanye). I had a chat with the old CEO of SLP before retirement and whilst he didn't give away anything confidential, on my query as to refiner's fees/ margins and why the margin appeared to fluctuate, he confirmed my suspicions it was a mixture of fixed costs and %, like you've confirmed here.

I have to admit for simplicity purposes, I'm one of the people that use the ballpark 15% for "back of the packet" calculations. In past THS Accounts when comparing reported PGM basket prices versus Revenues, I've noticed a difference of 13-15%, so for simplicity and to be conservative I just always round up to higher 15% when posting here.

When THS Interims are released on 27 May, i'll update my calcs for "Refiner fee/ margin" and PGM & Chrome AISCs etc. The THS Interims are normally incredibly detailed, far better than other AIM stocks or even FTSE companies I follow and still provide a lot of the detail you find in their audited annual accounts. They still helpfully break down their revenues by Chrome + PGMs for example in Interims.

The RNS of 23 Dec 2020 explained the sale purchase would not be completed between Tosca and Oisin Fanning

THS moved from a Net Debt position of $21.1m FYE Sept 2020, to Net Cash $31.4m, a swing of $52.5m in 6 months, with a dividend of $9.4m paid out (US 3.5 cents x 268,665,480 shares at time), so free cashflow after all costs of $61.9m in FY 1H 2021. That was based on production of 75.1k oz PGMs and 730.7k Chrome Ore.

Any portion of the $50m Vulcan Capex expended in 1H 2021 will not be included in the D&A for a Net Profit After Tax (NPAT) calc. If the $50m is back-end loaded to 2H 2021, you could assume perhaps $15m of Vulcan Capex paid out in 1H, the rest still in Trade Payables and/or work to be completed + invoiced.

So I would guestimate NPAT could be anywhere from $72-80m. If they pay a div of 17.5% NPAT, could be circa $12 - 14m payout across 269,059,931 shares (US 4.5 - 5.2 cents per share). This is very much a "Guestimate" in Caps as who knows the D&A or other deductions used by the Accountants/ Finance boffins. I also do not know profit from THS' Arxo arm.

The big surprise in Interims to be released 27 May 2021 for some could be just how big THS' Trade Balance is in their favour. In Accounts for FYE Sept 2020, Trade Receivables (incl. Contract Assets) minus Trade Payables et al was $55m. I will guestimate with the explosion in PGM prices, this could now be circa $75-80m+, in addition to their Net Cash position. THS and SLP are unique in this respect. All other miners and producers people like to compare side by side, normally their Trade Payables far outweighs their Receivables (i.e. a liability overall). Not the case for THS and SLP where it is a huge asset and this can be massively overlooked.

SR123 - I don't think anyone can accurately answer that until we see the Pre-feasibility Study for the Karo Resources area, which as TBTT mentions is some 96m 4E PGM Oz at 3.2g/t based on detailed info from Zimplats - Zimplats was forced to relinquish the contract areas to allow more entrants into the Zim market. On top of the historical info acquired from Zimplats, THS have done their own drilling and will all be factored into any initial report, that I believe is due to be released this year.

Whilst the dates mentioned in this article are of course out of date due to COVID19 and other factors causing delay, this article from Apr 2020 gives a good overview of the THS Zim assets:

https://www.miningreview.com/platinum-group-metals/tharisa-developing-a-future-in-zimbabwe-through-two-project-acquisitions/

THS currently hold 26.8% of Karo Resources, but believe they have an increase to acquire majority stake.

In today's AJ Bell/ Sharesmag presentation be good to get a brief update on Salene Chrome as that 90% option appears to have lapsed. Whilst Salene Chrome is completely separate from Karo, it is a small operation allowing THS to get used to doing business in Zim.

You're not taking into account $9.4m was paid out in calendar Q1 2020 as a dividend, nor that its historically the weakest production Q for the year.

So the free cash flow was $36m over the Q, normalising for dividend.

Finally PE is not free cashflow and the Profit will be higher than free cash flow, with the Vulcan Capex of course reducing free cash flow.

The refiner's costs and margins which are circa 15% are not part of THS Revenue, so yes in essence if you're trying to work out THS Revenue etc. from PGM basket, you would deduct 15% from "Revenue" to work out THS' real Revenue.

Feynzz - looks like its cooled off a little bit to $172tn

https://www.metalbulletin.com/Article/3980063/Raw-materials/Sentiment-in-Chinas-UG2-chrome-ore-market-weakens-after-earlier-sales.html

I would have to recommend THS (SA - PGM + Chrome producer), POLY (Russia and FSUs, dividend circa 4% in May), ALTN (Kazakhstan Gold) and AAZ (Azerbaijan - mainly Gold, bit of Copper and huge expansion potential with known working mines in occupied territories returning + Nargorno Karrabakh returning to Az and part of AAZ's Contract Areas).

I'm not a fan of SRB - the recent placing was pretty disgraceful for PIs, constant missing production targets, 2nd project Coringa delayed and now accident at Palito. On top of that you have Brazil falling apart with COVID19.

Div will be paid on 15 April 2021 to shareholders on the register at the close of business on 26 March 2021. Separately at May AGM, final dividend will be discussed too

Strange muted response - perhaps separate to FXPO, some investors are just wary of a very significant FED meeting this afternoon, which could spike US bond yields and bring entire market down if they're not dovish enough. However this doesn't change the company specific dynamics at play that FXPO are generating huge amounts of cash.

Even taking into account the Swiss WHT, this special div has a circa 5.3% yield on its own

The exploration and capex of $17m is classified as Development, intended to extend the Life of Mine more than 10% (therefore classed as non-sustaining and not included in AISC - https://www.gold.org/about-gold/gold-supply/responsible-gold/all-in-costs). It was made partially clear in the RNS with wording "development" and subsequently HUM has reconfirmed this via clarification emails to investors like Tones.

If you double-check AISC definitions in section "5. How should a company determine whether project costs should be categorised as sustaining vs. non-sustaining?" in link above it will clarify.

When Yanfolila LoM is 4yrs, not sure how great a multiple of 4.6 is... they need to get the LoM update out asap and news on Kouroussa Project Government Approval will obviously help too.

In fact further you read down the news release, Nornickel themselves are estimating a 700k oz hit to their original PGM guidance:

"According to the Company’s current base case estimates, metal production volumes are expected to fall short of the 2021 production guidance as follows: nickel — by approximately 35kt, copper — by 65kt and platinum groups metals — by 22t (approximately 710koz)"

Update on Nornickel's Palladium/Nickel Mine closures here which may explain the 5% increase in spot Palladium today:

Norilsk division adopts plan to resume operations at Oktiabrsky and Taymir Mines and Norilsk Concentrator:
https://www.nornickel.com/news-and-media/press-releases-and-news/the-norilsk-division-adopts-plan-to-resume-operations-at-oktiabrsky-and-taymir-mines-and-norilsk-concentrator/type=releases

"Nornickel, the world’s largest producer of palladium and high-grade nickel and a major producer of platinum and copper, is planning to restore full capacity of its flooded Oktyabrsky and Taimyrsky mines within the next 3-4 months"

Considering the mines have been suspended since 24-Feb, in total you could be looking at 4-5 months from closure and they still haven't completed the works of stopping water inflow, so who knows if they can fully restart Ops in 3-4 months. Could knock off 500k Oz off palladium supply this year. In the THS presentation they showed a Palladium surplus of 492k oz for 2021 (followed by similar defecit for 2022) - think forecasts provided by BMO, whereas Nornickel showed a 200k Oz deficit for 2021 and 2022. Even in BMO's forecast, this mine closure could knock out the entire forecasted surplus, when there is seemingly no back-up Palladium supply - the Palladium stored in ETFs in dwindling.