Tharisa Share Discussion Threads

[ntv] 07/12/2022 10:15

Zimbabwe has major power problems as Caledonia have found
Diesel generators and solar plant will be the answer but costly

[tigerbythetail] 07/12/2022 10:15

When a share price can't go up it must go down. And we have had a seller here who has been offloading a sizeable position for some time now. This will rise back up again to more "normal" levels once they are done.
Tharisa has never been in a stronger business position. And yet a look at the long term share price graph would make you think that the company was in some trouble. That's how distorted things are here now.

[basem1] 07/12/2022 08:38

The market seems to have its head on backwards at present Roll on January

[nakedmolerat] 07/12/2022 08:28

Here we go sub 100p, I should just go short rather than long here :D

[redtrend] 06/12/2022 22:24

SteadyEddie - as moneyman has partially pointed out you are incorrect Net Profit adjusted for Karo acquisition is more than last year.

Last year's Profit attributable to owners of the Company was $100m, this FY 2022 it was $117.4m. There's a breakdown on pg.27 of the Financials Presentation

hxxps://www.tharisa.com/pdf/investors/presentation/2022/tharisa-fy2022-results-presentation-final.pdf

So based on that adjusted/ normalised profit stripping out Karo, THS is on a current PE of merely 2.5 (based on USD GBP 1.2 Forex and normalising for Net Cash position), when it's open pit mine life is 19yrs not taking account of Karo and Tharisa Mine optimisations (benefication, hopefully increasing chrome over time to 2MT etc.). I'm also not taking into account their trade surplus of $25.8m. THS is unique in that its Trade Balance (Trade Receivables minus Trade Payables) is in large surplus not included in Net Cash. Most miners and producers this normally reversed.

On Karo to nitpick, their Net Interest I believe is actually 56% (66.3% x 85%), with Leto owning 1/3 of Karo Mining Holdings and Karo Mining Holdings 85% of Karo, with 15% to Zim Government (Generation Minerals). That's 56% of 190k oz p.a. 17yr open pit life, with huge room for expansion on top of that if it works out.

[moneyman50] 06/12/2022 21:12

Ignoring the profit on the subsidiary - EPS is circa 42c per share(last year 37c per share) and net cash as at 30/9/2022 is circa $80 million and no doubt growing on a weekly basis.
The investment in the new mine is over 18 months of which some has already been spent.
We have the $50 million bond issue -results of which will be announced next week and no doubt the rest of the investment will come from senior loan arrangements and current cash balances.the first anticipated production is in 18 months.

[5teadyeddie] 06/12/2022 19:44

Never looked at THS before. Profits as stated are exaggerated by the $48m book gain on acquisition of a subsidiary, without which they're lower than the previous year.

The P/E and % divis look great, but investing $391m (which has not yet been raised) in a half share (70% x 76%) of an unbuilt mine in Zimbabwe is enough to put the frighteners on anyone!

One for the watchlist only...

[moneyman50] 06/12/2022 19:13

Well said Podyted -still taken aback at the 22.2% cut in dividend when EPS and cash balances at record levels-no wonder the shareprice is stuck in a rut!
As always shareholders take the big hit in the bad times but are not given a fair share payout when times are good

[podgyted] 06/12/2022 18:59

All other things being equal, I can't see this doing much until Karo is up and running and has a couple of years under its belt. That's what I think the market is indicating - can't say I agree but I'm not the market.

Cutting the dividend whilst having a record year was a massive own-goal, but the powers that be have salaries we don't.

Kept a few for interest, sold the rest.

[frizzers] 06/12/2022 10:33

Might be of interest

hxxps://frisby.substack.com/p/the-results-are-in?sd=pf

[moneyman50] 05/12/2022 17:25

Agree TBT -strongest results yet,looking very good going forward and broker consensus targets in the £2.50 to £3 yet share price remains anchored to around a £1 and unnecessary cut in total dividend for year cut from 9c to 7c (this might help explain the non movement in shareprice.)
The other point that people might be negative on is the movement on the currency exchange reserve which is manly arises from restating the assets of the company from Zars to dollars and has no effect on the operational profitability of the business
Hate to think how low the shareprice would be if company had not had it’s best year ever.

[tigerbythetail] 05/12/2022 16:54

www.miningweekly.com/article/tharisa-delivers-its-strongest-financial-results-yet-2022-12-05/rep_id:3650

[moneyman50] 05/12/2022 13:28

Agree -the dividend cut does not inspire confidence-record eps and net current asset position yet the directors decide to cut the dividend and at the same time taking more remuneration.As always shareholders taking the pain and not sharing in the gain.
We shall see how the bond issue has gone shortly but I think it will be do well.

[podgyted] 05/12/2022 12:12

I think the extension to the Karo bond offering and the dividend cut has given the market pause to think.

[tigerbythetail] 05/12/2022 10:29

I agree that cutting the dividend was a decision which made for a bad headline. And most investors don't look beyond the "headlines". So THS have done themselves no favours with that.
BUT, other than that, the results are excellent. And the outlook for Pd and Rh prices is solid, and China emerging from lockdown should support chrome prices as well.
Going by fundamentals, would anybody think this company was overvalued if the share price were 200p, not 100p? I don't think so. But here we are!

[moneyman50] 05/12/2022 08:40

The market never likes a cut in the dividend.
A 1c dividend costs the company $3million dollars.
Looking at the cash position and the net current asset position an extra 2c dividend (total $6 million) would have very little/no effect whatsoever on the Karo investment and would have gone done well with investors/potential investors.

[lennonsalive] 05/12/2022 08:37

It's just not one for the market at the moment until big buyers come in. I can see this going sub 100

[cb7] 05/12/2022 08:21

I can perhaps understand why they have been cautious with the dividend, as going forward they will have more capital expenditure with the Karo project.

[sotolo] 05/12/2022 08:20

…and of course share price down to boot

[sotolo] 05/12/2022 07:53

Indalo divi is about 5.4%, with share price down 20% yield remains much the same.

[spooky] 05/12/2022 07:45

Berenberg raises target price from 240 to 260.

[indalo] 05/12/2022 07:34

Agree the dividend is a disappointment, especially given the poor share price performance. On the other hand net profits of $167m over market cap’ of $380m make it PE of 2.28, with the potential to double output (and profit?) from Karo, with minimal or no dilution due to the reinvestment of cash flow. So a doubling of profit followed by a doubling of rating (supported by a more generous future dividend policy off higher earnings) would suggest 4x today’s share price if the PE re rates to just 4.6x FY25 earnings. Meanwhile being paid 5.8% to wait, with very low share price risk is not a bad return.

[moneyman50] 05/12/2022 07:33

The profits after tax have not fallen-the reduction referred to by Sotolo appears to be due to foreign currency differences reflecting the cost of assets purchased in Zars being translated into dollars.The accumulated profits are up In accordance with the EPS whereas the foreign exchange difference reserve deficit has increased.The fall in dividend is very disappointing due to the increase revenue and profits generated

[sotolo] 05/12/2022 07:17

Well sorry I was wrong on the dividend but I didn’t expect it to be down annually over 20% and with the first divi still decent this one to be down a third, but then I didn’t expect net profit after tax on which it is based to be down over 20%, why? Will share price fall?

[moneyman50] 05/12/2022 07:16

Very disappointing to see a cut in dividend despite an increase in EPS.Despite increase in EPS total dividend cut from 9c to 7c per share for the year and virtually the minimum amount according to the dividend policy.!
Where is the special dividend previously hinted at due to high profits?