Source - RNS
RNS Number : 0264M
Tharisa PLC
10 October 2016
 

Tharisa plc

(Incorporated in the Republic of Cyprus with limited liability)

(Registration number HE223412)

JSE share code: THA

LSE share code: THS

ISIN: CY0103562118

(Tharisa or the Company)

 

Tharisa Minerals achieves record Q4 production, delivers on FY2016 targets and looks to an even better 2017

Tharisa reports an excellent Q4 production performance by achieving and, in some cases, exceeding production guidance for FY2016. Tharisa Minerals achieved record milling (1.27 Mt), PGM production (39.1 koz) and PGM recoveries (80.6%), demonstrating increased momentum at the end of the financial year. The open pit co-producer has also benefitted from improved commodity prices, particularly higher chrome prices, in Q4 FY2016.

 

Highlights for the financial year ended 30 September 2016

·     Fatality free year with a Lost Time Injury Frequency Rate (LTIFR) of 0.36 per 200 000 man hours worked, safety remains a priority

·     PGM production exceeds guidance at 132.6 koz (up 12.4%)

·     Chrome concentrate production achieves guidance at 1.24 Mt (up 10.8%)

·     Specialty chrome concentrate production more than doubles to 269.4 kt year on year (up 138.8%)

·     Record annual ROM reef mined at 4.837 Mt  with milling for the quarter at a new high of 1.267 Mt

·     PGM prices stable,  chrome prices rebound during the year to above US$165/t

 

"Tharisa achieved its best ever production quarter and reached its targeted guidance for FY2016.  This is a real testament to the teamwork, dedication and commitment that makes Tharisa a world class company. FY2017 is set to be the year that Tharisa reaches its full potential and delivers exceptional value to all stakeholders," said Tharisa CEO Phoevos Pouroulis.

 

Safety

The safety of all of Tharisa's employees is a priority for the Company. On 29 September 2016, Tharisa Minerals achieved the milestone of one fatality free year. There was only one Lost Time Injury in Q4 and the LTIFR for FY2016 was 0.36 per 200 000 man hours worked. In recognition of these achievements, Tharisa Minerals was awarded the Best Safety Performance in Class award at Mine Safe 2016.

 

Production update

The production update for the quarter ended 30 September 2016 is as follows:

 

 

Quarter ended 30 Sep 

2016

Quarter ended 30 Jun 

2016

Quarter ended 30 Sep 2015

Year

ended

30 Sep 2015

Year

ended

30 Sep

2016

 

Year on year movement

%

 

 

 

 

 

 

 

 

Reef mined

kt

1 243.3

1 235.4

1 102.2

4 183.2

4 837.2

15.6

Stripping ratio

m³ waste/m³ reef

8.2

7.4

12.2

10.7

7.3

Reef milled

kt

1 267.2

1 192.2

1 096.7

4 400.4

4 656.3

5.8

PGM flotation feed tonnes

kt

937.9

929.6

853.4

3 446.2

3 575.6

3.8

PGM rougher feed grade

g/t

1.61

1.64

1.52

1.62

1.65

1.9

6E PGMs produced

koz

39.1

33.5

27.1

118.0

132.6

12.4

PGM recovery

%

80.6

68.5

65.1

65.8

69.9

6.2

Average PGM contained metal basket price

US$/oz

804

745

754

885

736

(16.8)

Average PGM contained metal basket price

ZAR/oz

11 289

11 162

9 801

10 593

10 881

2.7

Cr₂O₃ ROM grade

%

17.5

17.7

18.4

18.3

18.0

(1.6)

Chrome recovery

%

63.5

61.6

61.1

58.0

62.7

8.1

Chrome yield

%

26.2

25.8

26.9

25.5

26.7

4.7

Chrome concentrates produced

kt

332.2

307.1

295.2

1 122.2

1 243.7

10.8

Metallurgical grade

kt

250.1

225.6

252.6

1 009.4

974.3

(3.5)

Specialty grades

kt

82.1

81.5

42.6

112.8

269.4

138.8

 

 

 

 

 

 

 

 

Metallurgical grade chrome concentrate contract price

US$/t CIF China

157

105

159

158

120

(24.1)

Metallurgical grade chrome concentrate contract price

ZAR/t CIF China

2 193

1 589

2 065

1 903

1 751

(8.0)

Average exchange rate

ZAR:US$

14.1

15.0

13.0

12.0

14.8

-

 

Mining

Tharisa's mining operations performed particularly well in Q4 FY2016 with 1.243 Mt of reef mined in the quarter.  The focus remains on grade control to improve the plant feed grades particularly for chrome.  Reef mining met the required call rates and to ensure access to the correct reef horizons, the waste stripping has increased to align with the life of open pit average ratio of 8.9 on a m3 basis. With throughput into the plant exceeding nameplate capacity during the quarter, the current ROM stockpile ahead of the processing plants is 165 kt. Tharisa aims to maintain a 200 kt ROM stockpile ahead of processing to ensure optimal reef layer blending and feed grade consistency into the plants.

Tharisa mined 4.837 Mt of reef in FY2016, which is 15.6% higher than the reef mined in FY2015.

 

Processing

It was an exceptional quarter for Tharisa with tons milled reaching an all-time high of 1.267 Mt.  Records were also achieved for PGM production at 39.1 koz and PGM recoveries of 80.6%, which is well above the target recovery of 70%.

Total chrome concentrate production was 332.2 kt, an 8.2% increase from Q3, at a recovery rate of 63.5%.  Of that production, 82.1 kt was specialty grade material, which typically fetches a pricing premium to metallurgical grade products.

Tharisa's Voyager Plant chrome processing circuit was modified in H1 FY2016 to facilitate an increase in the production of higher value specialty grade chrome concentrates on the back of the then depressed metallurgical grade chrome concentrate prices.  While metallurgical grade chrome prices have more than doubled since, this product diversification has enabled chrome production to be distributed to more globally diversified markets.

A total of 4.656 Mt of reef was milled in FY2016, representing a 5.8% increase year on year.  PGM production was 12.4% higher at 132.6 koz at an average recovery rate of 69.9%. Chrome production at 1.244 Mt was up 10.8% despite marginally lower feed grades. Chrome recovery averaged 62.7% in FY2016.  Optimisation initiatives planned should ensure that Tharisa achieves its targeted recovery of 65% for chrome concentrates.

 

Market update

The average PGM basket price for the three months ended September 2016 at US$804 (ZAR11 289) an ounce showed a US$59 an ounce improvement on the US$745 (ZAR11 162) price achieved in the quarter ended June 2016. 

Metallurgical grade chrome prices have risen approximately 50% over the quarter with an average contracted selling price of US$157 per tonne CIF main ports China achieved during the quarter. This marked improvement on the US$105 per tonne CIF contracted selling price concluded in the June 2016 quarter is attributed to the rebuilding of stockpiles by Chinese ferrochrome producers and is driven by stronger stainless steel demand growth in China resulting in increased demand for South African ore.

Contracts for delivery in November 2016 have been concluded at selling prices exceeding
US$200 per tonne CIF main ports China.

 

Outlook

Tharisa has provided FY2017 production guidance of 147.4 koz PGMs and 1.3 Mt chrome concentrates, of which 300 kt will be specialty grade chrome concentrates.

Tharisa continues to focus on improving the ROM feed grades and plant recoveries for both PGM and chrome concentrates.  

The above information has not been reported on or reviewed by Tharisa's auditors.

 

Paphos, Cyprus

10 October 2016

 

Sponsor

Investec Bank Limited

 

An analyst call to discuss Tharisa's Q4 and FY2016 production results will be held today, Monday, 10 October 2016 at 09:00 BST and 10:00 South Africa time (UTC +2). Tharisa's CEO Phoevos Pouroulis, CFO Michael Jones and operational management team will be on the call to take you through our achievements and answer production and market related questions.

 

 

 

LIVE CALL ACCESS NUMBERS FOR PARTICIPANTS

Country

Access Number

Other Countries - International

+27 11 535 3600

Other Countries - International

+27 10 201 6800

South Africa - Johannesburg Telkom

011 535 3600

South Africa - Johannesburg Neotel

010 201 6800

South Africa - Secunda

017 815 0499

UK - Toll-Free

0808 162 4061

USA and Canada - Toll Free

1 855 481 5362

 

PLAYBACK ACCESS NUMBERS - Playback Code: 53691

Country

Access Number

Other Countries - International

+27 11 305 2030

South Africa

011 305 2030

UK - Toll Free

0 808 234 6771

USA and Canada - Toll Free

1 855 481 5363

 

Investor Relations contacts:

Tharisa plc

Sherilee Lakmidas

+27 11 996 3538

+27 79 276 2529

[email protected]

 

Bell Pottinger

Daniel Thöle/Anna Legge

+44 20 3772 2500

Peel Hunt LLP (Joint Broker)

Matthew Armitt / Ross Allister

+44 207 7418 8900

 

BMO Capital Markets Limited (Joint Broker)

Jeffrey Couch/Neil Haycock/Thomas Rider

+44 020 7236 1010


This information is provided by RNS
The company news service from the London Stock Exchange
 
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