JSE- and LSE-listed platinum-group metals (PGMs) and chrome producer Tharisa expects to report basic earnings per share (EPS) and headline earnings per share (HEPS) of $0.04 apiece for the six months ended March 31.
This is a decrease of 60% compared with the EPS and HEPS of $0.10 apiece reported for the six months ended March 31, 2018.
The company has attributed the lower earnings to a material weakening of the metallurgical grade chrome concentrate price by 15.5% from $193/t in the first half of the 2018 financial year, compared with $163/t in the first half of the current financial year; a 14.8% year-on-year reduction in the volumes of chrome concentrates sold to 618 000 t; and an 11.9% year-on-year reduction in PGM volumes sold to 67 000 oz.
Additionally, the company’s EPS and HEPS were impacted on by an increase in cash costs per tonne mined, as a result of lower mining volumes, which reduced economies of scale. Costs were further impacted on by above inflation increases in costs, such as diesel of 18.1% per litre (in rand terms), which typically comprises about 14% of on-mine cash costs.
Meanwhile, production volumes and recoveries of both chrome concentrates and PGMs had trended upwards in the second quarter, compared with the first quarter ended December 31, 2018, and management expects this positive trend to continue into the second half of the financial year.
Tharisa remains on track to meet its production guidance for the full-year of 150 000 oz of contained PGMs and 1.4-million tonnes of chrome concentrates.
Tharisa’s interim results will be published on May 15.