Jubilee Metals Group PLC (LON:JLP Altx: JBL ), a diversified leader in metals processing with operations in Africa has announced the performance of its operations and progress on growth projects for the six-month period to 30th June 2022. Figures in this announcement are unaudited and exclude the effect of foreign exchange profits or losses.
Jubilee’s key achievement during the period was the completion and early results achieved of its c. £ 58 million (ZAR1.2 billion) investment programme in South Africa and Zambia that has reshaped the company, provided expanded production across PGMs, Chrome, Copper and Cobalt, and laid the platform for the expected growth during the full FY 2023 period.
Key Achievements for H2 FY2022
· Jubilee successfully completed its c. £ 58 million (ZAR 1.2 billion) investment programme to diversify and expand the Company’s PGM, copper and cobalt operational footprint
· In South Africa, construction and commissioning of the new 45% expanded Inyoni operations were completed in March 2022 with an annualised nameplate production capacity of 44 000 PGM ounces and a 1.2 million tonnes combined chrome concentrate capacity (up 85%)
· Jubilee achieved increased production of 21 140 PGM ounces for the six-month period (up 5% from the previous six-month period) despite planned operational interruptions to complete the new Inyoni processing facility
· Notably 95% of PGM ounces was produced at the new Inyoni operations during six-month period (compared to 75% in FY2021). This brings enhanced economics to Jubilee and has mitigated the impact of softer PGM prices
· Early results from the new Inyoni operations have outperformed expectations with a 34% reduction in PGM unit cost compared with the six-month period ending December 2021, as the facility benefits from significantly increased operational footprint and increased contribution from chrome production
· The enlarged Inyoni delivered an increase in unit earnings per PGM ounce of 12% compared with the six-month period ending December 2021, despite the realised PGM basket price reducing 3% over the period
· In Zambia, Copper production increased 14% to 1 388 tonnes, over the previous six-month period
· Southern Copper Refining Strategy for 12 000 tonnes per annum of copper was brought onstream with the commissioning of the new Roan copper concentrator and ramp-up of operations reached 80% of design capacity in August 2022
Leon Coetzer, Jubilee Metals Group CEO, commented: “I am extremely proud of the Jubilee team’s performance, and I thank each one of them for their dedication and innovation despite the various challenges, including at times, intense and prolonged supply chain disruptions. The team has delivered a significantly expanded and further diversified operational footprint which is already producing material increases in output and efficiencies.
“The rationale for the investment to expand our Inyoni operations is best illustrated by the simultaneous increase in not only the overall PGM production but also the sharp increase in earnings generated per PGM ounce despite softer metal prices. The past six months and especially the last quarter has shown a sharp increase in PGM production and lower costs as Inyoni achieved its full design capacity with the majority of the PGM production stemming from this quarter. This performance underpins our target of reaching 44 000 PGM ounces per annum from our own facilities as more of our production benefits from our renowned efficiencies.
“Equally in copper following a delayed start due to equipment deliveries, our Project Roan reached 80% of design capacity during the first week of August. This puts us on track to achieve our targeted 3 700 tonnes of copper over the current six-month period ending December 2022. The increased production rates are expected to further reduce our unit cost. With the delivery of Project Roan, we are on track to reach 10 000 tonnes of copper for the full twelve-month period ending June 2023, while we work to unlock the cobalt potential.
“I am very excited by what the FY 2023 period holds. It offers tremendous potential growth for our Company as it benefits from the foundation laid during the FY2022 period, with the full exposure of our enlarged South African operations as well as the commissioning of our new 12 000 tonnes per annum Southern Copper Refining operations and the realisation of our cobalt production.”
OPERATIONAL KEY PERFORMANCE INDICATORS
| COMBINED OPERATIONAL PERFORMANCE (UNAUDITED) | |||||
| KEY UNITS OF PRODUCTION | Unit | 12 months to30 Jun 2022 FY2022 | six months to30 Jun 2022 (H2) | six months to31 Dec 2021 (H1) | % changeH2 vs H1 |
| PGM ounces: | |||||
| – Inyoni | Oz | 35 188 | 20 036 | 15 152 | 32% |
| – Third party JV | Oz | 6 268 | 1 104 | 5 164 | (79%) |
| Total PGM ounces | Oz | 41 456 | 21 140 | 20 316 | 4% |
| Copper tonnes | Tonne | 2 604 | 1 388 | 1 216 | 14% |
| UNIT REVENUE | |||||
| Revenue per PGM ounce | $/oz | 1 609 | 1 586 | 1 632 | (3%) |
| Revenue per copper tonne | $/t | 9 195 | 8 903 | 9 527 | (7%) |
| UNIT COSTS | |||||
| Net cost per PGM ounce (after by-product credits chrome)1 | $/oz | 447 | 358 | 540 | (34%) |
| Net cost per copper tonne (after by-product credits cobalt) | $/t | 5 371 | 4 931 | 5 873 | (16%) |
| UNIT EARNINGS2 | |||||
| Net earnings per PGM ounce | $/oz | 1 162 | 1 228 | 1 092 | 12% |
| Net earnings per copper tonne | $/t | 3 824 | 3 972 | 3 654 | 9% |
COMBINED KEY FINANCIAL HIGHLIGHTS FROM OPERATIONS
· Operational earnings totalled £ 24 million (ZAR 480 million) for the six-month period ending June 2022 (up 24% from the previous six-month period)
· Revenue from operations totalled £ 76 million (ZAR 1.5 billion) for the six-month period ending June 2022 (up 21% from the previous six-month period)
· PGM unit cost of production reduced by 34% driven by increased PGM operational footprint and increased contribution of chrome by-product credits
· The group cash and cash equivalents as at 30 June 2022, stood at £ 16 million (FY2021 £ 19.6 million)
South African Operations
Operational Highlights
· South African operations maintained a strong safety performance over the six-month period with 162 days worked without any LTI
· Jubilee’s PGM operations delivered 21 140 PGM ounces of which 95% was delivered by the expanded Inyoni operations for the six-month period. This equates to an increase of 32% compared with Inyoni’s previous best performance of 15 152 PGM ounces
· Third party JV ounces decreased 79% as part of the strategy to migrate to Inyoni only production
Operational Financial Highlights
· Early results from the expanded Inyoni operations exceed expectations with a reduction of 34% in PGM unit cost of operations due to the increased PGM processing capacity and a sharp increase in the contribution from chrome by-product operations
· Net revenue from South African operations over the six-month period increased to £ 67 million (ZAR 1.3 billion) up 21% from the previous six-month period
· Net operational earnings from South Africa for the six-month period reached £ 20 million (ZAR 400 million) maintaining a strong margin of 30% and up 23% from the previous six-month period
Zambian Operations
Project and Operational Highlights
· Zambian operations maintained a strong safety performance achieving 124 days worked without any LTI
· 12 000 tonne per annum Southern Copper Refining Strategy brought into operation with the integration of the newly commissioned Roan copper concentrator with Sable Refinery
· Ramp-up of the Roan concentrator reaches 80% of design capacity at the time of this announcement
· Copper tonnes sold during the six-month period as part of operational trials increased to 1 388 tonnes, up 14% over the previous six-month period
Operational Financial Highlights
· Net revenue from Zambian operations increased to £ 10 million (ZAR 200 million) for the six-month period, up 16% from the previous six-month period
· Net operational earnings from Zambian operations increased to £ 4.2 million (ZAR 84 million) up 30% from the previous six-month period
Prospects for FY2023
South Africa
· The new enlarged PGM and chrome operations have set the platform to deliver 44 000 PGM ounces and 1.2million tonnes of chrome concentrate per annum from Jubilee’s own capacity. The PGM production benefits from the increased efficiencies of this new enlarged facility, which is significantly subsidised by the increased chrome production as highlighted by the results for the H2 six-month period. FY2023 offers strong potential for growth in earnings as it benefits from the full exposure of our enlarged South African operations
· Jubilee continues to progress discussions to secure a further PGM processing footprint in the Eastern Limb of the Bushveld (north-eastern region of South Africa’s chrome and PGM mining region). Jubilee has already secured significant tailings resources with further expansion opportunities in the area. Jubilee is reviewing the option to either secure a decommissioned PGM facility that will be repurposed by Jubilee, or to construct a new facility in the region
Zambia
· The Southern Copper Refining Strategy targets to produce 3 700 tonnes of copper within the first half of FY2023 ramping up to target 10 000 tonnes of copper for the full FY2023 year. If achieved this equates to a 284% increase in copper output
· In addition, the Company looks to complete the testing and commissioning of the cobalt circuit on the back of the completed ramp up of Project Roan offering the potential of significant earnings contribution
· Jubilee’s technical and projects team can now dedicate their focus on the development and execution of the Northern Copper Refining Strategy
