THARISA PLC - Second quarter production report for the period ended 31 March 2017

Second quarter production report for the period ended 31 March 2017

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')


Second quarter production report for the period ended 31 March 2017
Another quarter of steady production


Highlights for the three months ended 31 March 2017
    -    Reef mined of 1 219.2 kt continues to exceed the required run rate of 4.8 Mtpa on an
         annualised basis
    -    PGM production of 34.3 koz and chrome concentrate production of 314.6 kt
    -    Specialty chrome production of 75.4 kt, 24.0% of total chrome production
    -    PGM recoveries at 76.2% and chrome recoveries at 62.5%
    -    Average per ounce PGM basket price of US$783, US$43 an ounce higher quarter-on-quarter
    -    Average contracted metallurgical chrome prices at US$338/t, up 35.2% quarter-on-quarter


“Tharisa is proud to have performed at consistent levels for the fifth consecutive quarter. With
substantially increased chrome concentrate prices achieved during the first half of FY2017, together
with solid operational performance, we continue to deliver on our low cost, profitable co-product
business model,” said Tharisa CEO Phoevos Pouroulis.


Safety
Safety remains a top priority and Tharisa continues to strive for zero harm at its operations. We
recorded an improved LTIFR of 0.11 per 200 000 man hours worked.


Production update
The production update for the quarter ended 31 March 2017 is as follows:

                                         Quarter   Quarter Quarter on    Quarter   Half year
                                          ended     ended    quarter      ended      ended
                                         31 Mar    31 Dec movement       31 Mar     31 Mar
                                            2017     2016           %      2016        2017

Reef mined            kt                 1 219.2   1 229.9       (0.9)   1 234.2    2 449.1
Stripping ratio       m³ waste/m³ reef       7.5       9.0           -       7.1        8.4
Reef milled           kt                 1 211.3   1 206.4        0.4    1 199.6    2 417.7
PGM flotation feed
tonnes                kt                   897.9    885.1         1.4      942.3    1 783.0
PGM rougher feed
grade                 g/t                   1.56     1.52         2.6       1.74       1.54
6E PGMs produced      koz                   34.3     34.8        (1.4)      36.0       69.1
PGM recovery          %                     76.2     80.5        (5.3)      68.5       78.3
Average PGM
contained metal
basket price          US$/oz                783       740         5.8       685         760
Average PGM
contained metal
basket price          ZAR/oz              10 355   10 287         0.7    10 849      10 306

Cr2O3 ROM grade       %                     17.5     17.5            -      18.3       17.5
Chrome recovery       %                     62.5     64.3        (2.8)      63.9       63.4
Chrome yield          %                     26.0     26.7        (2.6)      27.7       26.3
Chrome concentrates
produced              kt                   314.6    322.2        (2.4)     332.3      636.8
   Metallurgical
   grade              kt                   239.2    245.1        (2.4)     259.9      484.3
   Specialty grades   kt                    75.4     77.1        (2.2)      72.4      152.5

Metallurgical grade
chrome concentrate
contract price        US$/t CIF China       338       250       35.2         81         278
Metallurgical grade
chrome concentrate
contract price        ZAR/t CIF China      4 430    3 488       27.0       1 262      3 783
Average exchange
rate                  ZAR:US$               13.2     13.9         5.0       15.8       13.6
Mining
Reef mined from the open pit totalled 1 219.2 kt for the quarter notwithstanding mining operations
being affected by unusually high seasonal rainfall. Total waste of approximately 2.5 Mm3 was moved
during the quarter (33% of which was interburden) at a stripping ratio of 7.5 on a m3:m3 basis. The
life of open pit average stripping ratio is 8.9. The ROM stockpile ahead of the processing plants was
230.2 kt as at 31 March 2017.


Given the long life of the open pit of 18 years, Tharisa has embarked on the transition to an owner
mining operating model. Tharisa has engaged with its current contractor, MCC Contracts Proprietary
Limited (“MCC”), to purchase the requisite fleet from MCC and to employ the employees currently in
service at the Tharisa Mine. Tharisa expects the transition in operating model to be completed in
FY2017.


Processing
During the quarter 1 211.3 kt were milled, resulting in PGM production of 34.3 koz on a 6E basis and
chrome production of 314.6 kt, 75.4 kt (24.0%) of which are specialty grade concentrates.


PGM recoveries at 76.2% and chrome recoveries at 62.5% were expected to be marginally lower
than the recoveries of the previous quarter mainly due to the weathered ore delivered to the
processing plants from the open-pit extension in the central pit and new areas mined within the
West pit. Recoveries are planned to return to previous levels in Q3 and this improvement was
evidenced in March 2017.


Market update
The average per ounce PGM basket price for the three months ended March 2017 was US$783
(ZAR10 355), which is US$43 an ounce higher than the US$740 (ZAR10 287) price achieved in the
quarter ended December 2016.


Contracted metallurgical grade chrome concentrate prices increased by 35.2% compared to the
previous quarter with an average contract price of US$338 per tonne CIF main ports China achieved
during the quarter. Specialty chrome concentrates continue to attract a premium above the
contracted metallurgical chrome concentrate prices. The metallurgical grade chrome concentrate
market remains robust with prices maintaining current levels in spite of lower liquidity in the
Chinese market. Chinese port stocks continued to be restocked from critically low levels seen in
August 2016 and reached levels of approximately 2.0 Mt in February 2017 but have systematically
been drawn down to approximately 1.6 Mt. The fundamentals of the global stainless steel market
remain sound with continued growth expected in 2017, further supporting strong demand for
chrome units in the form of ferrochrome and chrome ores.


Outlook
PGM and chrome production remains on track to meet the FY2017 production guidance of 147.4 koz
PGMs on a 6E basis and 1.3 Mt chrome concentrates, of which 300 kt will be specialty grade chrome
concentrates.


The half year financial results for FY2017 will be released on or about 16 May 2017.


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


Paphos, Cyprus
10 April 2017


JSE Sponsor
Investec Bank Limited


Investor Relations contact:
Tharisa plc
Sherilee Lakmidas
+27 11 996 3538
+27 79 276 2529
slakmidas@tharisa.com


Broker contacts:
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


Financial PR contacts:
Bobby Morse/Anna Michniewicz
+44(0) 20 7466 5000

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