Tharisa chrome production was up, PGM output fell below expectations

Paphos, Cyprus – Tharisa, the platinum group metals (PGMs) and chrome co-producer dual-listed on the Johannesburg and London stock exchanges, announces its production results for Q2 FY2023 and cash balance as at the quarter end.

Tharisa continued to generate healthy free cash flow in the second quarter of our financial year despite the significant impact of severe weather conditions to our open pit mining operations. While chrome production was up, the ore mix saw PGM output in January and February fall below expectations for the quarter.

Due to the challenges posed in December through to February specifically, management took the prudent step of lowering full-year guidance by 10%. The unique and unparalleled properties of its orebody, however, were once again shown to reap rewards as the chrome price reached levels as high as US$300/ tonne and, while the PGM prices have pulled back recently, even at these levels Tharisa continues to generate healthy margins.

Tharisa’s Vision 2025 strategy of reaching optimal and sustainable production from the Tharisa mine remains intact, and we will benefit from the significant progress being made at Karo, Tharisa second tier one mine – which remains on time and budget for first ore to the mill in H2 2024, as it continues to evolve into a multi-asset/multi-jurisdiction PGM producer.

Operational Update

• Total reef mined of 1 028.0 kt (Q1 FY2023: 1 081.5 kt) as adverse weather impacted the in-pit flexibility affecting volume and reef mix
• Stripping ratio of 12.6 m3: m3 (Q1 FY2023: 10.6 m3: m3) improved as waste was moved in areas recovering from in pit flooding
• Total reef tonnes milled for the quarter at 1 370.0 kt (Q1 FY2023: 1 427.8 kt), supplemented by stockpiles and strategic ROM ore purchases
• Quarterly PGM production at 34.3 koz (Q1 FY2023: 42.7 koz)
• Rougher feed grade of 1.66 g/t (Q1 FY2023:1.66 g/t)
• Recovery of 61.9% (Q1 FY2023: 71.7%) as oxidised UG ROM ore was also milled affecting PGM recovery
• Quarterly chrome production at 404.8 kt (Q1 FY2023: 383.1 kt)
• Grade of 18.4% Cr2O3 (Q1 FY2023: 17.0%)
• Recovery at 66.6% (Q1 FY2023: 65.7%) as yield from the Vulcan plant improved.
• Speciality chrome production was lower due to a planned spiral replacement programme

Karo Mining update

• Extensive earthworks proceeding to plan
• Civils contracts for the pouring of the foundations for all plants and infrastructure at Karo have been awarded
• Contracts for high voltage power line (31 km EIA permission) and all main transformers awarded
• Ordering of long-lead items for the project continuing as per schedule
• Trial mining to commence
• 30 kt of ore to provide further information on drilling, blasting, grade control and processing
• 150 employees and contractors on site in Zimbabwe, with majority of Zimbabwe management positions filled

Guidance

Due to lower than expected production in Q2 FY2023 production guidance is reduced by 10% from  the previous range of between 175 koz and 185 koz PGMs (6E basis) and 1.75 Mt to 1.85 Mt of chrome concentrates.