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JUBILEE METALS GROUP PLC - Quarterly Operations Update - Q2 2018

Release Date: 19/07/2018 08:00
Code(s): JBL     PDF:  
Wrap Text
Quarterly Operations Update - Q2 2018

Jubilee Metals Group PLC
Registration number (4459850)
AltX share code: JBL
AIM share code: JLP
ISIN: GB0031852162
("Jubilee" or "the Company")

Quarterly Operations Update
Q2 2018

Projects Highlights

    -    Hernic operational earnings increased 41 % to GBP 1.61 million (ZAR 27.69 million)
    -    Hernic project revenue up 25 % to GBP 3.31 million (ZAR 56.76 million)
    -    Hernic PGM* production up 18 % to 5 800 ounces
    -    Project earnings up 31 % to GBP 1.65 million (ZAR 28.32 million) which include GBP
         0.082 million (ZAR 1.44 million) plant refurbishment expenditure at DCM
    -    Project revenue up 12 % to GBP 4.37 million (ZAR 75.06 million)
* 6 Element Platinum Group Metals

Leon Coetzer, Chief Executive Officer, says:

“The Hernic project continues to perform well. The increase in PGM ounces produced had a
significant impact on the earnings soaring by more than 40 %. This jump in earnings reflects
the low variable cost base for the project per PGM ounce produced. The lower feed supplies
which hampered production in June has been overcome and the project is poised to break
through 6 000 ounces per quarter.

Our operational footprint is rapidly expanding. The construction of the fines chrome
recovery plant at DCM is underway and we have commenced with our PGM PlatCro project
which targets to double our PGM processing rate by February 2019. We have also
commenced with the construction of the zinc recovery circuit at Kabwe while the design of
the lead recovery circuit is being concluded.”

Hernic Platinum and Chrome Project (South Africa)

The Hernic operation performed well during Q2 2018 continuing to deliver increased PGM
ounces at 5 800 PGM ounces delivered resembling an increase of 18 % quarter on quarter.
Project earnings increased by 41 % quarter on quarter which reflects the low variable cost
base per PGM ounce produced of the project. Q2 included a record production of 2100
PGM ounces in a single month. We expect to further increase this production rate in line
with the increase in reclaimed surface material delivered by Hernic.
The table below presents the comparative quarterly performance of the Hernic project:

                                                                                                               Jubilee           Jubilee
                 Tailings         PGM             Project        Project   Project              Project                                      Unit cost /
                                                                                                            attributable      attributable
                processed        ounces          revenue        revenue earnings3              earnings                                       PGM oz
                                                                                                              earnings          earnings
                 tonnes         delivered       (GBP'000)1     (ZAR'000)2 (GBP'000)           (ZAR'000)                                       (USD)4
                                                                                                             (GBP'000)         (ZAR'000)

Total Q3
                 105 673          2 874           1.539         26.581          496            8.592            496                8.592        476
Total Q4
                 121 644          3 755           2.047         37.011          965            17.466           965                17.466       382
Total Q1
                 110 409          4 897           2.651         44.013         1.141           18.908           1.141              18.908       434
Total Q2
                 119 479          5 800           3.308         56.761         1.612           27.686           1.612              27.686       397
Project to       538 032         18 133          10.005        171.970         4.104           70.724           4.104              70.724       439

1= Revenue from the current project phase - 100% attributable to Jubilee until full capital recovery. Revenue is projected based on latest
average PGM market prices and USD exchange rates and results are only final once final Quotational Period has passed
2= Average monthly conversion rates used
3= Project Earnings include all incurred operational costs including management services and mineral royalties
4= Unit cost includes provision for utility overhead.

DCM Project (South Africa)

The construction of the fine chrome recovery project is currently underway at DCM. The
project targets to commission the new expanded fine chrome recovery circuit during Q4
2018. During this period we also increased our investment into the upgrade of the existing
DCM chrome beneficiation plant as reflected in the financial numbers below. We are
targeting to complete the fines chrome recovery plant during Q4 2018 which holds the
potential to dramatically enhance the production of chrome at DCM.

Chrome production at DCM is expected to remain at current levels during the construction
of the fine chrome recovery plant with the existing DCM material containing mostly fine
chrome and enriched PGMs. Jubilee continues to have positive engagements with the
Department of Mineral Resources to accelerate the approvals required to conclude the
construction of the PGM recovery plant.
The table below presents the operational quarterly performance of the DCM project:

                    Chromite                                                                          Jubilee              Jubilee
                                       Project         Project      Project         Project
                   concentrate                                                                     attributable         attributable
                                      revenue         revenue      earnings3       earnings
                    produced                                                                         earnings             earnings
                                     (GBP'000)2      (ZAR'000)     (GBP’000)      (ZAR’000)
                     tonnes                                                                         (GBP’000)            (ZAR’000)
Total Q3
                      15 134            1.129         19.526           184            3.173               356              6.139
Total Q4
                      11 788           1.254          22.858           508            9.307               254              4.654
Total Q1
                       9 810            1.240         20.628           245            4.080               123              2.040
Total Q2               9 461           1.066          18.297           741          1.2641                371              6321
Project to           139 920          15.241         263.388         7.860   135.669   2.818   49.193

1 = Includes GBP 82 000 (ZAR 1.44 million) plant refurbishment expenditure
2 = Average monthly conversion rates used
3 = Project earnings include project expenditure on plant and equipment
4= Since April 2017

PlatCro Platinum Project (South Africa)

Jubilee commenced delivering PGM material from its PlatCro project to Northam Platinum’s
Eland Platinum operation in June with 31 000 tonnes of material delivered during June.
Jubilee has commenced with the expansion of the material sorting and de-watering plant at
PlatCro to support the targeted ramp-up of material delivery to 50 000 tonnes per month.
The target is to build a stockpile in excess of 200 000 tonnes of PGM rich material at the
Eland Platinum concentrator prior to commencing platinum recovery in February 2019.

Kabwe Zinc, Lead and Vanadium Project (Zambia)

As announced previously the initial construction focus of the Kabwe project is on the zinc
primary leach recovery circuit.

The enhanced process flow sheet for the Kabwe project includes a separated zinc and lead
recovery circuit which significantly improves the flexibility of the metals recovery plant.
This allows the project team to independently execute the zinc and lead metals recovery
strategy. The decision was taken to commence with the construction of the zinc recovery
circuit ahead of concluding the final design for the lead recovery circuit which is under
design review. The circuit design review and optimisation test work includes work to
determine the commercially optimal product purity specifications.

This enhanced process flowsheet has been presented to the Zambian department of mines
who welcomed the significant progress made towards executing the Kabwe project.

We expect to conclude the final design parameters for the project during Q3 of 2018.

United Kingdom

19 July 2018


Jubilee Metals Group PLC

Colin Bird/Leon Coetzer
Tel +44 (0) 20 7584 2155 / Tel +27 (0) 11 465 1913
Nominated Adviser

SPARK Advisory Partners Limited
Mark Brady/Andrew Emmott
Tel: +44 (0) 203 368 3555


Shard Capital Partners LLP
Damon Heath/Erik Woolgar
Tel +44 (0) 20 7 186 9900

JSE Sponsor

Sasfin Capital (a member of the Sasfin group)

Sharon Owens
Tel +27 (0) 11 809 7500

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