Jubilee Metals Group Plc (LON:JLP), is gearing up for a promising year ahead, buoyed by robust performance and strategic initiatives across its operations in Zambia and South Africa. According to Zeus Capital’s latest report, written by analyst Paul Smith, Jubilee Metals is poised for significant growth in both copper and chrome production, signalling a strong recovery and a return to growth across its diversified portfolio.
Strong Copper Production Outlook
Jubilee Metals has made substantial progress in Zambia, where copper production is expected to ramp up considerably in FY2025. The completion and commissioning of the Roan concentrator mark a pivotal achievement, enabling the processing of low-grade “waste” material. This advancement not only optimises existing resources but also aligns with Jubilee’s strategic partnership with IRH, Abu Dhabi’s sovereign wealth fund, in a 30% joint venture to process millions of tonnes of “waste” rock, which could yield significant copper production.
Paul Smith highlights the conservative ramp-up approach taken by Jubilee, suggesting that the company might exceed expectations. With copper production guidance set between 5.8kt and 7.5kt for FY2025, up from 3.4kt in FY2024, Jubilee is well on track to enhance its copper output significantly. The Sable refinery will benefit from an increased supply of high-grade material from Jubilee’s Munkuyo open pit project and the newly acquired Project “G”, further solidifying its copper production capabilities.
Capitalising on High Chrome Prices
In South Africa, Jubilee is capitalising on the booming chrome market. The company is set to commission the new Thutse chrome plant in the September quarter, which will process chrome Run-of-Mine (ROM) ore through a profit-sharing joint venture. With chrome prices currently around $308/t, the Thutse plant is expected to be a significant profit driver. Jubilee’s strategy to expand chrome production to 2Mt per year, with a substantial portion being profit-shared, positions the company to generate impressive returns from this venture.
Strategic Management of PGM Resources
While the Platinum Group Metals (PGMs) market has been challenging due to lower basket prices, Jubilee Metals has taken a strategic approach by stockpiling PGM-rich tailings. This decision reflects the company’s forward-thinking strategy to maximise value when market conditions improve. Despite the current lower profit margins in PGMs, Jubilee remains well-positioned to benefit from any future recovery in PGM prices, ensuring that it can unlock the full potential of its resources.
Final Thoughts
Jubilee Metals Group plc is entering FY2025 with a strong operational foundation and a clear growth strategy. The company’s unique processing capabilities, coupled with its ability to manage and optimise resources across its projects, make it well-placed to deliver on its production targets. As Zeus Capital continues to view Jubilee’s fair value at 11p per share, the anticipated ramp-up in both copper and chrome production could herald a period of robust growth and profitability for Jubilee Metals in the coming year.
