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JUBILEE METALS GROUP PLC - Jubilee Metals Group PLC - Quarterly Operations Update Q1 2019

Release Date: 09/05/2019 08:00
Code(s): JBL     PDF:  
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Jubilee Metals Group PLC - Quarterly Operations Update Q1 2019

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

Dissemination of a Regulatory Announcement that contains inside information according to
REGULATION (EU) No 596/2014 (MAR).

Jubilee Metals Group PLC
Quarterly Operations Update Q1 2019

Jubilee Metals Group ("Jubilee" or the “Company"), the AIM and AltX traded metals
processing company, is pleased to announce its operational update for Q1 2019.


    •    57% increase in quarterly operational earnings to GBP 3.22 million (ZAR 58.85 million)
    •    54% increase in combined quarterly revenue up to GBP 6.56 million (ZAR 119.90
    •    PlatCro chrome acquisition completed and contributing to Company earnings ahead
         of projections
    •    PlatCro PGM* project (platinum and palladium dominant) targeted to commence with
         production in Q2 2019
    •    First chrome concentrate from DCM fine chrome project delivered to market with
         production ramp up expected to reach full design capacity of 25 000 tonnes per
         month in Q2 2019
    •    Exposure to wider commodity basket, including chrome, PGMs, vanadium, zinc and
    •    Increased backing from institutional investors secured to complete funding for the
         Kabwe project
    •    Successful secondary placement of all Jubilee shares held by BMR Group PLC to
         institutional investors
* 6 Element Platinum Group Metals including platinum, palladium, rhodium, ruthenium, osmium and gold

Leon Coetzer, Chief Executive Officer, says:

“The period has been exceptional for Jubilee, showcasing the implementation of our stated
mission to grow our earnings base, while maintaining strong margins and diversifying our
operational footprint into base metals and across a number of mining jurisdictions.

The team delivered strong earnings growth breaching GBP 3 million while simultaneously
implementing the PlatCro chrome transaction to increase our chrome operational footprint
and successfully securing the funding for the implementation of our Zambian Kabwe project.
This performance was achieved despite a notoriously slow operational period in January.
Our DCM fine chrome project is a remarkable achievement, delivering its first saleable chrome
concentrate to the market. I look forward to the team achieving full design throughputs on
the back of this success during the next period. ”

Consolidated operational financial review for Q1 2019

Q1 2019 has seen continued delivery by the Jubilee team bringing into operation a further
two projects, with the acquisition of the PlatCro chrome operation and the commissioning of
the DCM fine chrome project.

This strong performance is expected to continue in Q2 2019 as the PlatCro PGM project is
brought into production at a targeted processing rate of 60 000 tonnes per month and the
acceleration of the Kabwe vanadium, zinc and lead project, following the recent acquisition
of the Sable Zinc Kabwe Limited (“Sable Refinery”) refinery in Zambia.

The table below presents the operational revenue and earnings performance for Q1 2019.

                                                                        Jubilee        Jubilee
                                              Project      Project   attributable   attributable
                                             revenue      revenue      earnings       earnings
                                            (GBP'000)   (ZAR'000)1    (GBP'000)      (ZAR'000)
                      Q4 2018                3,737       68,807        2,173         40,078

                      Q1 2019                3,443       62,959        1,908         34,993

                                                                        Jubilee        Jubilee
                                              Project      Project   attributable   attributable
                                             revenue      revenue      earnings       earnings
                                            (GBP'000)   (ZAR'000)1    (GBP'000)      (ZAR'000)
                      Q4 2018                 534        9,840         (123)         (2,267)

                      Q1 2019                3,117       56,945        1,309         23,854

                                                                        Jubilee        Jubilee
                                              Project      Project   attributable   attributable
                                             revenue      revenue      earnings       earnings
                                            (GBP'000)   (ZAR'000)1    (GBP'000)      (ZAR'000)
                      Q4 2018                4,271      78,647         2,049         37,811

                      Q1 2019                6,560      119,904        3,216         28,847

1 = Average monthly conversion rates used

Reporting timetable going forward
With the rapidly widening project footprint in terms of mining jurisdictions, and commodity
basket, as well as an active expansion plan, the Board has, in consultation with a number of
major shareholders, concluded that it will in future present a more detailed consolidated
operational and financial review on a six monthly period while continuing with a more
frequent project update. As the business continues to mature, the Board believes this will
provide shareholders with a more detailed view of the Company’s operational and project

PlatCro operations – chrome, platinum and palladium (South Africa)

Following completion of the acquisition of the PlatCro chrome operation in mid-January 2019,
the Company has successfully phased in management and operational control over the
project. The chrome operation has already contributed positively to the group chrome
earnings ahead of projections as the Company continues to drive efficiencies and enhance

Importantly, Q2 2019 will be the first full quarter for this operation, and a more detailed
operational and financial performance will be provided in the half yearly update, which the
Company believes will be more reflective of the potential of this operation. The PlatCro PGM
project is expected to commence with the production of platinum and palladium rich
concentrates during Q2 2019, and holds the potential to double Jubilee’s current PGM ounce
production over the life of the project.

Hernic PGM operations - platinum and chrome (South Africa)

The Hernic PGM operation maintained a strong performance despite the power outages
suffered during February and the delay in reaching full operational levels following the festive
period which affected the supply of feed material during January 2019. The operations have
returned to full operational levels producing in excess of 2 000 PGM ounces for April 2019.
The Company maintained the operation’s low cost base producing at below USD400 per PGM
ounce sold, to achieve an attributable project earnings for the quarter at GBP 1.91 million
(ZAR 35 million).

DCM operation - chrome (South Africa)
Jubilee’s ground breaking DCM fine chrome recovery plant, constructed during Q4 2018, has
successfully advanced its commissioning phase during Q1 2019, with the first chrome
concentrate being produced to target concentrate grades in January 2019 and delivered to

The production rate continues to be ramped up with design throughput rates of 25 000
tonnes per month expected to be reached during early Q2 2019. This new fine chrome
recovery plant is a significant milestone for Jubilee as it demonstrates to the industry the
recoverability of fine chrome at saleable concentrate grades.

Kabwe operation – zinc, lead and vanadium (Zambia)
As previously announced on 21 March 2019, Jubilee has entered into an agreement with two
subsidiaries of Glencore plc (the “Agreement”) to acquire Sable Zinc Kabwe Limited (the
“Sable Refinery”) in Zambia (the “Acquisition”).

Closing of the Acquisition is conditional upon the fulfilment of certain conditions precedent
as contained in the Agreement, including the approval of the Acquisition under the Zambian
Competition Act. Jubilee has submitted its application for the approval of the Acquisition to
the Zambian Competition and Consumer Protection Commission (the “Commission”) and has
had positive engagements with the Commission to further its review of the application.

During this interim period, Jubilee’s project team has been granted access to the Sable
Refinery to refine the implementation plan with a view to integrating Jubilee’s vanadium, zinc
and lead refining process with the existing operations at the Sable Refinery once the condition
relating to the Approval by the Commission as noted above has been satisfied.

Jubilee has entered into discussions with various potential suppliers of run of mine zinc rich
material within the Kabwe region. The supply of such high grade zinc material offers the
potential to increase the targeted zinc refining capacity in addition to the targeted Kabwe
surface material. Jubilee would only consider such processing opportunities if they are value
accretive and further enhances project operating margins. Each of these opportunities are
carefully considered both commercially and technically by Jubilee and ranked based on
potential value addition to the Kabwe Project.

One such potential supplier of zinc ore includes Star Zinc a company in partnership with
Galileo Resources PLC (“Galileo”). Jubilee is in discussions with Galileo to evaluate the pre-
classification at source of a high grade zinc stream which would be suitable for further refining
at Jubilee.


Jubilee is pleased to announce that the Company has successfully facilitated the placement
of all Jubilee shares held by BMR Group PLC (“BMR”) with a large institutional investment
fund. BMR no longer has an interest in the ordinary share capital of Jubilee. This relates to
the 2018 transaction whereby Jubilee acquired 29.01% of BMR as announced on 15 January
2018. The acquisition consideration at the time was satisfied through a combination of cash
and the issue of new Jubilee shares.

United Kingdom

9 May 2019


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
Andrew Emmott/Vassil Kirtchev
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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