Wrap Text
Tharisa Minerals achieves record Q4 production, delivers on FY2016 targets and looks to an even better 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 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$165/t
“Tharisa achieved its best ever production quarter and reached its targeted guidance for FY2016.
This is a real testament to the teamwork, dedication and commitment that makes Tharisa a world
class company. FY2017 is set to be the year that Tharisa reaches its full potential and delivers
exceptional value to all stakeholders,” said Tharisa CEO Phoevos Pouroulis.
Safety
The safety of all of Tharisa’s employees is a priority for the Company. On 29 September 2016,
Tharisa Minerals achieved the milestone of one fatality free year. There was only one Lost Time
Injury in Q4 and the LTIFR for FY2016 was 0.36 per 200 000 man hours worked. In recognition of
these achievements, Tharisa Minerals was awarded the Best Safety Performance in Class award at
Mine Safe 2016.
Production update
The production update for the quarter ended 30 September 2016 is as follows:
Quarter Quarter Quarter Year Year Year on
ended ended ended ended ended year
30 Sep 30 Jun 30 Sep 30 Sep 30 Sep movement
2016 2016 2015 2015 2016 %
Reef mined kt 1 243.3 1 235.4 1 102.2 4 183.2 4 837.2 15.6
m³
waste/m³
Stripping ratio reef 8.2 7.4 12.2 10.7 7.3 -
Reef milled kt 1 267.2 1 192.2 1 096.7 4 400.4 4 656.3 5.8
PGM flotation feed kt 937.9 929.6 853.4 3 446.2 3 575.6 3.8
tonnes
PGM rougher feed g/t 1.61 1.64 1.52 1.62 1.65 1.9
grade
6E PGMs produced koz 39.1 33.5 27.1 118.0 132.6 12.4
PGM recovery % 80.6 68.5 65.1 65.8 69.9 6.2
Average PGM US$/oz 804 745 754 885 736 (16.8)
contained metal
basket price
Average PGM ZAR/oz 11 289 11 162 9 801 10 593 10 881 2.7
contained metal
basket price
Cr?O? 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 kt 250.1 225.6 252.6 1 009.4 974.3 (3.5)
grade
Specialty grades kt 82.1 81.5 42.6 112.8 269.4 138.8
Metallurgical grade US$/t CIF 157 105 159 158 120 (24.1)
chrome China
concentrate
contract price
Metallurgical grade ZAR/t CIF 2 193 1 589 2 065 1 903 1 751 (8.0)
chrome China
concentrate
contract price
Average exchange ZAR:US$ 14.1 15.0 13.0 12.0 14.8 -
rate
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
slakmidas@tharisa.com
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
Date: 10/10/2016 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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