Tharisa Share Discussion Threads

[basem1] 18/1/2021 12:28

Obviously not

[basem1] 18/1/2021 11:57

Wonder if ST tips this today ?

[mfhmfh] 18/1/2021 10:55

once the seller clears this will fly to 200p.

just look at SLP flying.

IMHO.

[scubadiverr] 15/1/2021 16:40

Can anyone point me in the direction of a good thesis evaluating THS vs SLP?

[martinfrench] 13/1/2021 14:20

thanks retrend, informative

[redtrend] 13/1/2021 12:57

Hi Martin - from the THS Annual Results Overview, they confirmed guidance for FYE Sept 2021 as follows:

"Guidance
FY2021 production guidance of 155 koz to 165 koz PGMs (6E basis) and 1.45 Mt to 1.55 Mt of chrome concentrates."


From the FY Q1 Report issued yesterday they're clearly on track to meet the middle of both guidances.

They are currently working on Vulcan Fine Chrome Project which will increase Chrome to the 2Mt for FYE Sept 2022, they should hit this target.

For PGMs, to push past 165K Oz figure, there are a number of optimisations THS are working on and it's THS "aspirational target" to achieve 200K PGMs in FYE Sept 2022 (this is by no means formal, but was stated as an aspiration in the last investor telecon with THS). From my notes from the investor call, the 200k target is dependent on increase in feed grade from open pit and increase in PGM recoveries to 85% (achieved 80% recovery FYE Sept 2020). To assist with this target THS mentioned 1 or 2 optimisation tweaks in flotation circuit as examples.


The original target of 2MT chrome and 200K PGMs dubbed Vision 2020 still mentioned on website was pushed back - COVID19 put a spanner in works not just from operational standpoint, but from financing the Vulcan Fine Chrome Project. With the explosion in PGM prices, they are now funding Vulcan Project organically from cashflow. Even with this additional capex for 2021, they've just turned Net Cash and seem to be improving their Net Cash position by $26m per quarter. That was when PGM basket was at $2,400. It's now at $3,000 Oz.

[martinfrench] 13/1/2021 12:22

as i just posted over on lse, isnt it a little unclear the amount of pgms going to be produced in 2021 ? or can someone clarify

[catsick] 13/1/2021 05:04

Rhodium fixes this am at 20k the profits at the moment will be insane, 40 year mine life and trading at around 1 times the current cash generation run rate

[napoleon 14th] 12/1/2021 22:49

BUBLOO - "trading at eps of around 2 if prices remain the same"

You mean a P/E of 2, surely?

[deadly] 12/1/2021 14:12

The XD date is 25th Feb. for 3.5cents.

[redtrend] 12/1/2021 13:20

Bubloo - apologies your right, although Tharisa's mine is next to mining town of Mooinooi, which itself is 2km from Gauteng.

[bubloo] 12/1/2021 11:13

based on todays prices ths is slated to to make ebidta of around 350 to 400 million dollars.
If you had listented to phoevus webinar he said the chromium profit margin was around 28% when chrome was in 130's and the aisc for pgm was arounf 588 dollars. If you look carefully at last years results it is clear that any increase in revenue largely goes into gross profit as this is I think a largely a fixed cost mining business with marginally variations.
my own calculations suggest it is trading at eps of around 2 if prices remain the same.
I have an eps of betwenn 50 to 60 cents at the least

all opinions welcome

[bubloo] 12/1/2021 11:06

tharisa mines are in northwestern province with low infective rates and not in gauteng

[redtrend] 12/1/2021 10:04

No worries UKG. To balance my bullish post, the only issue to consider for new investors or existing ones topping up is the COVID19 2nd wave in South Africa.

There is a possibility SA Gauteng region THS and SLP operate in could go in to more stringent lockdowns than they are currently under, although this has not occurred yet.

THS operations are naturally more suited to social distancing and complying with any new SA Gov dictats as it's all open pit mining, predominantly "yellow fleet". Whereas SLP for example, Samancor who provide the chrome arisings are a mix of underground and open pit. Both navigated 2020 lockdowns without any major issues.

It could still have a marginal impact on THS - we've seen from their update some personnel are impacted by covid.

On flipside more stringent lockdowns will impact PGM and Chrome underground mining significantly curtailing supply, giving a significant boost to PGM prices and Chrome too. Probably one of many reasons Rhodium is circa $19,000 Oz. It also weakens the ZAR reducing costs. So it's a case of "swings and roundabouts".

[ukgeorge] 12/1/2021 09:38

Thank you for your analysis Redtrend.

[redtrend] 12/1/2021 09:34

Not sure why you think this is uninspiring - they've had a $26m increase in net free cashflow in 1 single quarter, moving from $21m Net Debt to $5m Net Cash.

That equates to $100m+ free cashflow per year based on market cap of only £345m.

However since this update, THS 6E PGM basket has increased by $600 per Oz to $2,995oz and Chrome increased by $10tn to $145tn. If those prices were maintained, free cashflow would be in $200m p.a. region.

I don't base my investment in THS on PGM basket staying at such elevated levels, but even on $100m free cashflow p.a. this is significantly undervalued.

Whilst the dividend investors will all receive in Feb is now only 2% (they still need to announce ex-div date), if these PGM prices continue I would hope THS think about a special interim dividend in the 7% region when they provide interims in April/May time.

Once Vulcan Fine Chrome Project is complete ($50m Capex), FY 2022 starting 1-Oct-2021, I would expect 10% dividend yields with the cash THS are throwing off.

[deadly] 12/1/2021 09:27

PGMs volume 14% up on year and price much higher.
Dividend to be anounced soon.
Slow start today but should motor ahead.

[basem1] 12/1/2021 07:47

Fairly uninspiring update Neutral to negative as regards the SP

[joemillion] 11/1/2021 17:17

£1.40 plus tomorrow...

[mfhmfh] 11/1/2021 16:53

let's see what tomorrow brings

[deadly] 11/1/2021 16:39

Q1 production report tomorrow. Seems a bit lacklustre of late. Had a few more after the drop today.

[mfhmfh] 05/1/2021 10:38

good top-up opportunity IMHO.

palladium futures above £2,400

platinum futures £1,080

Rhodium at a record £17,800

Production update next Tuesday according to calendar.