Jubilee Metals, the diversified metal processing group, saw a strong operating performance in the year ended June 30, which assisted in buffering the group against market challenges, including a fast falling platinum price and rising costs.
It demonstrated “Jubilee’s ability to challenge industry norms by breaking through technical barriers and implementing solutions that extract value from materials and ore sources that were previously regarded by others as waste or too complex,” its directors said in the results published yesterday.
On the JSE, the share price fell 7.19% to R1.55 in the morning.
“As a consequence of the investments made in the last financial year, we can report that our expansion into higher margin chrome mining and processing activities has already started to yield positive results,” chairman Ollie Oliveira said in his first report to shareholders in the annual report.
Over the past year, the company saw record production across its platinum group metals (PGM), chrome and copper operations, and an investment programme of £36 million (R836m) (FY2022: £58m) was implemented to diversify and expand operations in chrome, PGM, copper and cobalt.
An expanded PGM processing facility was commissioned to process PGM tailings and ores, previously regarded as waste. “This versatile facility boasts an annual production capacity of 44 000 ounces of PGMs,” the group said.
The chrome operational footprint was expanded through a long-term chrome ROM off-take agreement offering increased chrome margins capable of offsetting the lower PGM margins.
In South Africa, backup power units were installed at the chrome facilities, and stock levels were managed to ensure continuous operations.
In Zambia, there were advancements in the process flow for the treatment of mixed and transitional copper reefs as part of the company’s 14 000 tons per year Southern copper strategy.
“The upgraded flow sheet offers significant lower capital expansion opportunities within Zambia,” the group said.
The company’s technical team was in the process of innovating a copper waste leach circuit to treat copper and cobalt tailings as part of the company’s Northern Refining copper strategy.
The development phase had started with encouraging result to date.
Infrastructure issues associated with the new Roan Concentrator in Zambia were addressed. A modern water infrastructure system was completed in December 2022, followed by an enhanced power infrastructure finalised in February.
In the past year, revenue from operations increased by 1% to £142m.
Gross profit was lower at £31m (£45m), impacted mainly by lower average PGM prices, an 11% increase in operating cost per PGM in US dollars driven driven mainly by the increase in power and logistic costs, and an initial decrease in chrome margins in the first half due to power constraints.
Copper revenue per ton also fell 19%
The continued growth of the chrome operations offered the potential to offset lower PGM margins.
In the past year, earnings per share fell by 35% to 0.48 pence as a result of the average number of shares increasing by 9% to 2 687.7 million shares due mainly to the exercise of warrants during the financial year.
Headline earnings per share from continuing operations fell to 0.46 pence from 0.70 pence. Group cash and equivalents at June 30 came to £12.5m (£16m), and the balance sheet remained robust.
“Jubilee has become the expert on reprocessing tailings dumps, and there are billions of historic tonnes of waste dumps, which we can process economically and remove harmful contaminants, which are currently going into the water table,” said Oliveira.
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