Tharisa Plc · JSE:THA
Tharisa — Investor Presentation (July 2021)
36 slides from Tharisa's investor presentation, Jul 12, 2021
Slide 1: Right Mining, Right Commodities
12 July 2021 RIGHT MINING, RIGHT COMMODITIES THS:LSE • THA:JSE MELLOMONDAY INVESTOR PRESENTATION Enriching lives through innovating the resources company of the future
Slide 2: Who We Are
• 42.79 MOZ IN CONTAINED 859.58 MT IN WHO WE ARE MINERAL RESOURCE 6PGE+Au* • 172 MT IN CONTAINED Cr2O3* 1 2 3 4 5 6 Integrated 10 year 14 year +40 year Profitable Consistent PGM and chrome operational LOM open pit underground throughout dividend payer co-producer located in track record mechanised l
Slide 3: Safety and ESG | Caring Beyond the Mine Gate
SAFETY AND ESG | CARING BEYOND THE MINE GATE • Community is 6% shareholder in Tharisa Minerals • 5year fatality free • US$1m spent on community upliftment • 5 million FFS on 1 June 2021 • Provide infrastructure services to the community • Employment of more than 700 people from • All employees on pr
Slide 4: Our Business
tharisa OUR BUSINESS
Slide 5: Discover Develop Deliver
FOUNDATIONS OF SUSTAINABILITY Long-life Mechanised modern fleet Maximum Recoveries Capturing the value stream DISCOVER DEVELOP DELIVER DIVERSIFY OREBODY MINING PROCESSING VALUE Enriching lives through innovating the resources company of the future 5
Slide 6: Sustainable Long Term Returns
SUSTAINABLE LONG TERM RETURNS CAPITAL DISCIPLINE VALUE OREBODY PROCESSING MINING GROWTH CONTINUOUS INVESTMENT RETURNS • Complete organic growth opportunities 100 • Capital appreciation • Commercialise downstream opportunities • Dividend US$ 48.5 million in last 6 years 100,4 US$c %NPAT Dividend poli
Slide 7: FY2021 Interim Results Salient Features
FY2021 INTERIM RESULTS SALIENT FEATURES REEF MINED PGM PRODUCTION (5PGE+Au) CHROME CONCENTRATE PRODUCTION 2.5 Mt 75.1 koz 730.7 kt up 8.7% up 12.9% up 12.0% (2020: 2.3 Mt) (2020: 66.5 koz) (2020: 652.6 kt) REVENUE OPERATING PROFIT EBITDA US$313.6 m US$104.5 m US$124.2 m up 61.2% up 368.6% up 243.1%
Slide 8: FY2021 Q3 Production
LTIFR SPOT CHROME PRICE SPOT PGM BASKET PRICE FY2021 Q3 PRODUCTION 0.12 / 200 000 hours ~US$ 165/t ~US$3 000/oz • Achieved 5 million fatality free shifts • Delivered record mining rates and tonnes processed • Record quarterly chrome concentrate output and increased PGM production supported by strong
Slide 9: Our Commodities
OUR COMMODITIES
Slide 10: Platinum Group Metals
CONCENTRATED UNIQUE PLATINUM GROUP METALS SUPPLY APPLICATIONS - Six elements known for their unique properties and used in 5E PGM DEMAND industrial, medical, and electronic applications Rhuthenium Iridium Autocatalyst ~90% 5% 1% Autocatalyst ~40% Rhodium Jewellery ~24% - Highly concentrated supply w
Slide 11: Positioning Ttharisa in the PGM World
SPOT PGM BASKET PRICE FY2021 guidance POSITIONING THARISA IN THE PGM WORLD ~US$3 000/oz 155koz to 165koz • 42.79 million ounces contained 6PGE+Au * RESOURCES PRILL SPLIT 4E % • PGM producer 120 − 142 100 ounces of PGMs FY2020 100 12 7 7 9 8 9 10 6 5 8 1 6 • Tharisa position in terms of global demand
Slide 12: Chrome
CHINA CHROME SOUTH AFRICA STORY • Chrome is what makes steel stainless GLOBAL STAINLESS STEEL CAGR ADDITIONAL STAINLESS STEEL • South Africa hosts 72% of the global chrome reserves +5.0% 2.7 Mtpa • 75% of supply comes from primary producers • 25% as a by product of platinum producers ADDITIONAL CHRO
Slide 13: Positioning Tharisa in the Chrome World
SPOT PGM BASKET PRICE FY2021 guidance POSITIONING THARISA IN THE CHROME WORLD ~US$165/t 1.45Mt to 1.55Mt • 177 million tonnes contained Cr2O3 CHROME PRODUCTION FY2020 (kt) • Significant chrome producer 321,6 1023,2 − 1 344 800 tonnes in FY2020 23,9% 76,1% − Provides China with 10% of all its chrome
Slide 14: Long Term Production and Pricing
PGM GUIDANCE CHROME GUIDANCE LONG TERM PRODUCTION AND PRICING 155 - 165 koz 1.45 – 1.55 Mt • Long life asset PGM AND CHROME PRODUCTION (k000t, koz) Consensus forecast − Increasing, stable production profile − 14y open pit modelled 400 3300 3140 − 40y underground planned 350 2800 • Prices • PGM baske
Slide 15: Growth Opportunities
tharisa GROWTH OPPORTUNITIES
Slide 16: PGM Downstream Smelting and Refining
PGM DOWNSTREAM SMELTING AND REFINING • ARXO Metals is the R&D division of Tharisa • Primary aim is the beneficiation of concentrate material • Producing PGM alloy refine through downstream processes • 1MW demonstration plant operational for three years • Developing an integrated beneficiation site n
Slide 17: Salene Manganese and Iron
SALENE MANGANESE AND IRON • Situated in the manganese and iron rich region of the Northern Cape, South Africa • Tharisa has an option to acquire 70% equity • Salene’s principal activity is the mining of manganese and iron ore on a DSO basis • Mine is in operation and is cash generative • Current pro
Slide 18: Karo Mining
KARO MINING • Tharisa owns 26.8% of Karo Platinum • 2 phases of exploration have been completed and studies Snakes Head underway, due for completion end August 2021 • Financing discussions have commenced • Phased approach to ensure project build and cash flow development • Special Economic Zone (“SE
Slide 19: Salene Chrome
SALENE CHROME • Option exercised 100% ownership • Salene Chrome East covering 11 900 ha (chrome project) • Salene Chrome West covering 12 400 ha (Au, Ni & Cu) • Capital allocation of US$5.0 m • Plant construction underway with production before Y/E 2021 OPEN PIT - Shallow chrome seams that outcrop -
Slide 20: Conclusion
CONCLUSION • Proven track record • Co-product of PGMs and chrome • Exchange rate benefits • Healthy cash generation • Continued investment & return to shareholders • Robust balance sheet • Steady growth profile Enriching lives through innovating the resources company of the future 20
Slide 21: Financial Metrics
FINANCIAL METRICS
Slide 22: Revenue and Gross Profit
PGM GROSS PROFIT MARGIN CHROME GROSS PROFIT MARGIN REVENUE AND GROSS PROFIT 49.9% 29.5% Agency and • Gross profit margins improved to 41.0% (2020: 22.4%) Trading Manufacturing 3,3% 0,6% • The major factors contributing: Chrome - increased sale volumes 23,8% - increase in the PGM basket price - reduc
Slide 23: Profitability
PROFITABLE THROUGH THE PROFITABILITY CYCLE METRIC UNIT H1 FY2021 H1 FY2020 % change Revenue US$ m 313.6 194.6 +61.2 EBITDA US$ m 124.2 36.2 +243.1 Profit before tax US$ m 104.6 17.5 +497.7 Earnings per share US cents 21.4 3.6 +494.4 Dividend per share US cents 4.0 - Return on invested capital* % 35.
Slide 24: Costs
VOLUME OUTPUT COSTS REDUCES UNIT COSTS H1 H1 % ON MINE CASH COST OF SALES METRIC UNIT FY2021 FY2020 change Labour Cubes mined Mm3 8.8 8.2 +7.6 19,6% Overheads Cost per cube mined* US$/m3 8.6 8.6 - 15,0% Consumables Reef tonnes mined Mt 2.5 2.3 +8.5 4,4% Cost per reef tonne mined* US$/t 30.5 31.0 -1.
Slide 25: Cash Flow and Dividends
CASH GENERATION CASH FLOW AND DIVIDENDS REWARDING SHAREHOLDERS • Operating cash flow of US$104.9 m • Payment of interim dividend post COVID-19 − Additions to property plant and equipment of US$39.5 m • Ensuring returns for shareholders while pursuing growth − Repayment of Senior Debt Facilities of U
Slide 26: Balance Sheet and Capex
CONTINUOUS BALANCE SHEET AND CAPEX INVESTMENT AND HEALTHY BALANCE SHEET • Cash and cash equivalents of US$72.8 m • FY2021 sustaining capex US$54.4 m (excludes deferred stripping) − Total debt of US$43.0 m − Vulcan Plant US$46.4 m − Positive net cash of US$29.8 m - Spent to date US$25.6 m (net of def
Slide 27: Corporate
tharisa CORPORATE
Slide 28: Corporate Profile (THS:LSE THA:JSE)
CORPORATE PROFILE (THS:LSE THA:JSE) CAPITAL STRUCTURE DIRECTORS OF THARISA SHAREHOLDER SPREAD - Loucas Christos Pouroulis (Executive Chairman) 1,42 Strategic Issued shares 269.1 million - Phoevos Pouroulis (Chief Executive Officer) 1,27 Investors 1,31 Market capitalisation* GBP354.4m ZAR6.8bn 1,70 M
Slide 29: Corporate Structure
CORPORATE STRUCTURE Tharisa plc (Registered in Cyprus) Listed on LSE (THS) and JSE (THA) BEE 20% Thari Resources 100% 100% 26.8% 100% 74% 6% Tharisa Community trust 26% Karo Project Tharisa Minerals Arxo Resources Arxo Logistics Salene Chrome (Zimbabwe) (South Africa) (Cyprus) (South Africa) (Zimbab
Slide 30: Tharisa's Journey
THARISA’S JOURNEY 2009 2012 2018 2017 • Acquired 74% • Secured project • Shareholding • Agreement entered into for shareholding in finance facility of acquired in Karo the purchase of mining fleet Tharisa Minerals ZAR1 billion 2014 Holdings and transfer of employees 2006 • Commenced • First bulk rai
Slide 31: Commitment to R&D and Investment
COMMITMENT TO R&D AND INVESTMENT • Since the initiation, Tharisa has been committed to the beneficiation of its mineral products as well as the development and deployment of innovative processing and technology US$504 m THARISA GROUP TOTAL INVESTMENT • The R&D department of Tharisa has been developi
Slide 32: R&D to Commercialisation
R&D TO COMMERCIALISATION 1MW SMELTER PGM OPTIMISATION CHALLENGER PLANT FOURTH STAGE VULCAN PLANT PROJECTS CRUSHING Producing PGM alloy and Successfully increasing Production of higher Increased the capacity for In house developed to develop further the PGM recoveries at value chemical and production
Slide 33: Innovative Approach
INNOVATIVE APPROACH Enriching lives through innovating the resources company of the future 33
Slide 34: Processing
PROCESSING GENESIS PLANT VOYAGER PLANT VULCAN PLANT • Nameplate capacity: 100 ktpm ROM • Nameplate capacity: 300 ktpm ROM • Under construction • Processes reef layers with lower PGM and • Processes reefs with higher PGM and • Nameplate capacity: 340 ktpm tailings higher chromite grades lower chromit
Slide 35: Disclaimer
DISCLAIMER These Presentation Materials are for information purposes only and must not be used or relied upon for the purpose of making any investment decision or engaging in any investment activity. Whilst the information contained herein has been prepared in good faith, neither Tharisa plc (the ‘C
Slide 36: Right Mining, Right Commodities
12 July 2021 RIGHT MINING, RIGHT COMMODITIES THS:LSE • THA:JSE MELLOMONDAY INVESTOR PRESENTATION Enriching lives through innovating the resources company of the future