Tharisa Plc · JSE:THA

Tharisa — H1 FY2015 Earnings Presentation

33 slides from Tharisa's earnings presentation, May 2015

  1. Slide 1: Interim Results for the Six Months Ended 31 March 2015

    INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2015

  2. Slide 2: Disclaimer

    DISCLAIMER 2 This document has been compiled by Tharisa plc (“Tharisa”). While the information contained herein is believed to be accurate, no representation or warranty, express or implied is or will be given by Tharisa or its respective directors, employees or advisors or any other person as to th

  3. Slide 3: Agenda

    AGENDA 3 1 OVERVIEW AND OPERATIONAL REVIEW 4 2 FINANCIAL REVIEW 10 3 MARKET OVERVIEW AND OUTLOOK 16 4 Q&A 20 5 APPENDIX 21

  4. Slide 4: Overview and Operational Review

    OVERVIEW AND OPERATIONAL REVIEW

  5. Slide 5: Salient Features

    SALIENT FEATURES 5 PGM production Revenue EBITDA (6E) 49.5% 1.9% 37.7% 57.4 koz US$123.7m US$17.9m (2014: 38.4 koz) (2014: US$126.1m) (2014: US$13.0m) Chrome concentrate Operating profit HEPS production 1.1% 63.5% 150% 563.3 kt US$12.1m US$0.01 (2014: 569.4 kt) (2014: US$7.4m) (2014: Pro forma US$0.

  6. Slide 6: Highlights

    HIGHLIGHTS 6 LTIFR Net operating Gross PGM profit profit margin 0.07* US$12.1m 39.1% One of the despite weak (2014: 31.0%) lowest in the industry commodity prices (2014: 0.14) (2014: US$7.44m) Total cash unit cost Low cost per CIF China costs per tonne processed PGM ounce decreased by decreased by 1

  7. Slide 7: Tharisa at a Glance

    THARISA AT A GLANCE 7 830 >20 ESTIMATED YEARS OPEN PIT LIFE ESTIMATED YEARS UNDERGROUND 40 >1.50 12 000 Mtpa ROM Mt RESOURCE TONNAGE >144 4.8 CONTAINERS pa Mtpa CHROME 0.07 21 000 1 200 PLATINUM CONCENTRATES METALS PGM TRUCK GROUP 497 kozpa RAIL WAGONS pa LTIFR (per 200 000 man hours) LOADS pa GROUP

  8. Slide 8: Safety

    SAFETY 8 PGM INDUSTRY LTIFR* FOCUS ON SAFETY 1.20  Safety remains the number one priority of management and all employees - we strive for zero harm 1.00  Regrettably during the reporting period there was a 0.80 fatality - enquiry completed and recommendations implemented 0.60  Tharisa’s LTIFR con

  9. Slide 9: Operational Highlights

    OPERATIONAL HIGHLIGHTS 9 KEY OPERATIONAL METRICS RECORD PGM PRODUCTION H1 FY2015 H2 FY2014 H1 FY2014  Reduced operational risk with successful transition to a ROM mined Mt (0.5%) 1.95 1.94 1.96 multiple contractor mining model to separately mine waste and reef PGM grade g/t (0.03g) 1.65 1.58 1.68 

  10. Slide 10: Financial Overview

    t a a rl Sq FINANCIAL OVERVIEW

  11. Slide 11: Financial Highlights – Income Statement

    FINANCIAL HIGHLIGHTS – INCOME STATEMENT 11 INCOME STATEMENT HIGHLIGHTS INCREASED PROFITABILITY US$ million %* H1 FY2015 H2 FY2014 H1 FY2014  Revenue decreased marginally partly as a result of 12.4% lower (1.9) 123.70 114.59 126.14 US$ PGM basket price and marginally lower chrome concentrate Revenue

  12. Slide 12: Financial Highlights – Operating Segments

    FINANCIAL HIGHLIGHTS – OPERATING SEGMENTS 12 PGM AND CHROME REVENUE AND COSTS PROFITABLE WITH SIGNIFICANT UPSIDE POTENTIAL H1 FY2015* H1 FY2014  Increased combined gross profit percentage of 18.4% compared to 16.0% in H1 FY2014 US$ millions PGMs Chrome Total PGMs Chrome Total Revenue 44.09 79.61 12

  13. Slide 13: Operating Cost Analysis – Ex-Works

    OPERATING COST ANALYSIS – EX-WORKS 13 PGM CASH COST OF SALES CHROME CASH COST OF SALES Overheads 10% Overheads 18% Diesel 18% Mining 46% Mining Diesel 49% 17% Labour 5% Steelballs 3% Labour Reagents 9% 9% Utilities Steelballs Utilities 6% 5% 5%

  14. Slide 14: Financial Highlights – Balance Sheet

    FINANCIAL HIGHLIGHTS – BALANCE SHEET 14 CAPITAL AND FUNDING CAPITAL EXPENDITURE SUBSTANTIALLY COMPLETED US$ million 31 Mar 30 Sep 2014  Total debt to equity ratio 49.4% 2015 Total capital spend* US$ 387.5 378.4 – Optimisation projects funded from operational cash flows and debt, may increase ratio

  15. Slide 15: Financial Highlights – Cash Flow

    FINANCIAL HIGHLIGHTS – CASH FLOW 15 SUMMARY CASH FLOW STATEMENT OPERATIONALLY CASH GENERATIVE US$ million H1 FY2015 FY 2014 H1 FY2014  Net operating cash flow before working capital Operating cash flow 15.42 22.36 28.81 requirements of US$18.2 million Profit (loss) 4.87 (54.87) (28.24)  Net cash f

  16. Slide 16: Market Overview and Outlook

    t a a | S a MARKET OVERVIEW AND OUTLOOK

  17. Slide 17: Market Overview

    MARKET OVERVIEW 17 PGM CHROME PGM OUTLOOK CHROME ORE MARKET OUTLOOK  General view at Platinum Week is for metal prices to  International chrome concentrate prices remain stable remain subdued in the short term as production from South Africa recovers from the 2014 strike  Chinese port stocks rema

  18. Slide 18: Outlook

    OUTLOOK 18  PGM and chrome production in H2 FY2015 expected to be similar to H1 FY2015  Non-routine maintenance of plant in Q3 FY2015 ~ 12% lost production time  Steady state mine production from Q3 FY 2015 – 400 ktpm  PGM recoveries exceeded plan, steady state production of 144 kozpa targeted f

  19. Slide 19: Vision

    VISION 19 LEADING NATURAL RESOURCES COMPANY PGM, CHROME AND STEEL RAW MATERIALS LARGE SCALE, LOW COST PROJECTS THAT ARE IN OR CLOSE TO PRODUCTION

  20. Slide 20: Q&A

    tharisa a&a

  21. Slide 21: Appendix

    tharisa APPENpDIx

  22. Slide 22: Investment Highlights

    INVESTMENT HIGHLIGHTS 22 Large scale Open pit operations with One of the worlds largest (830 Mt resource) over 20 years LOM and single chrome mid-tier PGM and chrome 40 year LOM resource mines concentrate co-producer underground extension Mechanised open pit Steady state production mining with a of

  23. Slide 23: Mining All Six MG Chromitite Layers

    MINING ALL SIX MG CHROMITITE LAYERS 23 MINERAL RESOURCE MG4A  830 Mt  6E PGMs 1.56 g/t  Cr₂O₃ 20.38% MG4 MG4(0) OPEN PIT MINERAL RESERVE  102 Mt  6E PGMs 1.51 g/t MG3D Generalised cross section showing chromitite layers in relation to (Merensky) MRK and LG  Cr₂O₃ 19.36% MG3 MG3ZEB  Commitment

  24. Slide 24: Location of Tharisa Mine

    LOCATION OF THARISA MINE 24 LOCATED IN THE MAIN PGM AND CHROME PRODUCING AREA IN SOUTH AFRICA  Mining rights over 5 516 ha  Adjacent to Anglo Platinum, Lonmin, Impala Platinum, Eastern Platinum  Well serviced by road, rail, power and other services  Neighbouring towns are Brits (45km) and Rusten

  25. Slide 25: Low Cost Producer

    LOW COST PRODUCER 25 THARISA HIGHLIGHTS LOCATED IN THE LOWEST COST QUARTILE OF PLATINUM PRODUCERS*  Producing PGM (6E) concentrate 2500 2000 Tharisa  Producing metallurgical, chemical 1500 and foundry grade chrome All in cost (US$/oz platinum) concentrates 1000 500  Chrome concentrates provide si

  26. Slide 26: Shallow Producer

    SHALLOW PRODUCER 26 THARISA HIGHLIGHTS GLOBAL PLATINUM PRODUCTION BY MINE METHOD  Open cast mine with >20 years life  Low labour intensity Tharisa  No requirements for shafts, ventilation

  27. Slide 27: Low Sustaining Capex Operation

    LOW SUSTAINING CAPEX OPERATION 27 THARISA HIGHLIGHTS SIB PER EQUIVALENT PLATINUM OUNCE PRODUCTION  Low SIB (stay in business) capex compared to PGM mining sector  Mining contracted out and SIB capex for mining fleet built into contract  No smelters or refineries  Stable SIB capex profile  Under

  28. Slide 28: Marketing, Sales and Logistics

    MARKETING, SALES AND LOGISTICS 28 MARKETING AND SALES LOGISTICS  PGM concentrate offtake  Integrated platform to agreement with Impala mitigate logistics risks and providing a  Agency agreement with competitive advantage Noble Resources for metallurgical chrome  Road transportation concentrate o

  29. Slide 29: Key Differentiators

    KEY DIFFERENTIATORS 29  Strength to strength from 2006, through the financial and energy crises – identification of unique ore body – innovative development of the Genesis and Voyager plants  Capital investment programme substantially complete  Mechanised open pit mining – no electricity requirem

  30. Slide 30: History and Milestones

    HISTORY AND MILESTONES 30 THARISA PLC PRIOR TO ACQUISITION OF THARISA MINERALS BY THARISA PLC POST ACQUISITION OF THARISA MINERALS BY THARISA PLC JAN 2011 FEB 2012 FEB 2008 APR 2008 US$95 million investment by Fujian Secured project finance facility of ZAR1 billion Tharisa Limited (subsequently Cons

  31. Slide 31: Corporate Structure

    CORPORATE STRUCTURE 31 THARISA (Cyprus) 20% THARI RESOURCES1 100% 100% 74% (South Africa) 100% DINAMI THARISA INVESTMENTS ARXO RESOURCES THARISA MINERALS (Guernsey) (Cyprus) (Cyprus) (South Africa) 100% 100% COMMUNITY TRUST1 6% (South Africa) THARISA THARISA FUJIAN ADMINISTRATION INDUSTRIAL (“TFI”)

  32. Slide 32: Contact Details

    CONTACT DETAILS Investor Relations contact: Michelle Taylor D: +27 11 996 3507 M: +27 82 564 7888 mtaylor@tharisa.com Website: www.tharisa.com

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