REG - Jubilee Metals Group - Half-Yearly Financial Report to 31 December 2022
20/03/2023 07:00
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RNS Number : 4444T Jubilee Metals Group PLC 20 March 2023
Jubilee Metals Group PLC
Registration number (4459850)
Altx share code: JBL
AIM share code: JLP
ISIN: GB0031852162
("Jubilee" or "the Company" or "the Group")
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Unaudited Condensed Half-Yearly Financial Report for the six months to 31
December 2022
Jubilee Metals Group PLC (AIM: JLP; Altx: JBL), a leader in diversified metals
processing, with operations in Africa, today publishes its condensed unaudited
Half-Yearly Financial Report for the six-month period ended 31 December 2022
("H1 FY2023").
Overview
Financials
§ Group Revenue of £63.1 m (H1 FY2022: £63.3 m)
o Revenue contribution from combined PGM and chrome sales of £58 m and
copper sales of £5.1 m
o PGM basket price US$1 453/oz down 11%, partially offset by PGM operational
cost management and production output
o Realised copper price US$ 6 893/t down 28% on H1 FY2022 with strong market
recovery post period
§ EBITDA of £10.3 m (H1 FY2022: £13.7 m)
§ Adjusted EBITDA of £11.8 m (H1 FY2022: £14.9 m)
§ Operating expenses of £9.7 m (H1 FY2022: £10.9 m)
§ Strong net cash flows from operating activities of £16.9 m (H1 FY2022:
£2.3 m)
§ Continued investment of £24.1 m (US$28.4 m) in copper and cobalt
expansions
§ Closing cash position of £11.7 m (30 June 2022: £16 m)
Operations
§ Lost time injury frequency rate (LTIFR) of 1.0 in South Africa; LTIFR of
2.9 in Zambia
o Regrettable safety incident, related to an engineering service provider
that sadly resulted in a fatality
o Decisive action taken to take a more direct safety management role of
service providers
§ Strong operational performance from the South African PGM and chrome
operations despite initial impact of power outages
§ PGM operations recorded 18 208oz all from own operations (H1 FY2022: 20
316oz)
o PGM oz up 20% from own operations on the back of Inyoni expansion (H1
FY2022: 15 152oz)
o Initial impact of power outages addressed by increased stock holding and
installation of back-up power units at chrome operation in November 2022
§ Chrome production up 2.3% to 634 111 tonnes on track to exceed full year
guidance of 1.2 m tonnes despite initial impact of power disruptions
§ Costs remain tightly controlled
o Net cost per PGM oz net of chrome credits of US$608
o Net cost per copper tonne of US$5 232
§ Copper production of 1 149 tonnes below expectation as a consequence of
the delayed ramp-up of Roan Concentrator, mainly due to power and water
disruptions in Zambia, now resolved (H1 FY2022: 1 314 tonnes)
o Expanded power infrastructure implemented (Feb 2023)
o New privately owned water infrastructure implemented (Dec 2022)
o Roan Concentrator resumed ramp-up of operations (end Feb 2023)
o Successfully delivered first cobalt production through commissioning of
cobalt hydroxide circuit at Sable Refinery in Zambia adding to its copper
refining capability
Strategy and growth projects
§ Jubilee benefits from its ability to produce multi-commodities providing it
with a buffer against market volatility
§ Eastern Limb PGM expansion progressing targeting an additional 25 000 PGM
oz per annum
o Expected to commence construction during Q4 CY2023
§ Ramp-up of copper operations at Roan Concentrator in Zambia recommenced,
reaching 80% of capacity at time of announcement, following successful power
and water interventions
o Final phase of ramp-up to commence early April targeting 100% of capacity
and full commercialisation of the Southern Copper Refining project during May
2023
§ Roll-out of copper expansion strategy in Zambia refined to align with the
security of additional power and water infrastructure
o Centralised processing footprint offering significant capital savings by
enlarging Roan Concentrator and reducing the number of new greenfields
operations required for Northern Refinery expansion
§ Discussions well advanced to secure a further refining footprint to serve
the targeted Northern Refining expansion strategy
§ Sable Refinery commenced production of cobalt hydroxide achieving export
grade with the ability to further expand operations
Full year Outlook FY2023
§ PGM production of 38 000oz unchanged with potential of upwards revision
depending on South Africa's power supply outlook
§ Chrome operations expected to exceed guidance of 1.2 m tonnes of chrome
concentrate with support of stronger chrome prices seen during current period
§ Copper guidance adjusted to 3 000 tonnes, revised to align with the
delayed ramp-up of Roan Concentrator and commercialisation of the Southern
Copper Refining project
o Post commercialisation, expected in May 2023, the Southern Copper Refining
project, projected to maintain 550 tonnes of copper per month from Roan alone
and 130 tonnes from third party supplies
o Copper prices remain well supported by constrained supply against a strong
demand for the metal. Copper price up by 13.6% during January 2023 to date
compared with the reporting period
§ The flexibility of Sable Refinery offers Jubilee the ability to pivot
between copper and cobalt production to rapidly respond to changing market
fundamentals. This flexibility is used at all times to maximise copper
equivalent production units.
o Cobalt prices have come off sharply during the current period therefore
Sable is able to pivot towards increased copper production
Statement from Leon Coetzer, CEO:
"Our South African operations delivered a strong performance, with a 20%
increase in PGM oz versus H1 FY2022 from own operations while our chrome
operations exceeded guidance, despite the impact of initial power
interruptions. Costs remained tightly under control, with PGM unit cost
remaining close to US$600 per ounce. This positions our PGM operations at the
bottom quartile of the industry's cost curve which is of key importance during
current volatile markets.
"Our Roan copper concentrator is back on track, with the resumption of the
ramp-up of the operations reaching 80% of full capacity by the time of this
announcement, after an extended period of water and power outages that have
been addressed through our various interventions during February this year.
"Jubilee has shown its resilience, acting speedily to implement solutions that
address the infrastructure challenges faced at our operations during the
period. The actions taken in South Africa included the implementation of
back-up power units at our Windsor operations, which will be expanded over the
coming period, while increasing the PGM stock held at our Inyoni operations to
buffer against any prolonged power outages at our chrome operations. In
Zambia, we expanded our scope and implemented a dedicated, privately owned
water infrastructure, to ensure water supply to our Roan operations, while
expanding the power infrastructure and entering into a new power arrangement,
that significantly enhances the security of supply to our operations.
Together, these measures should mitigate against the impact of future power or
infrastructure related issues on our operations.
"Our Integrated Southern Copper and Cobalt Refining project has confirmed
Jubilee's capability to produce both copper and cobalt from perceived waste
and discard materials. It forms the foundation for our teams to drive forward
with confidence the implementation of the refined Northern Copper and Cobalt
Refining project as we seek to reach in excess of 35 000 tonnes of copper per
annum.
"Jubilee's exposure to a multi-commodity operational footprint, offers great
flexibility and is of key strategic value, especially in current volatile
metal markets. Chrome and Copper prices have remained resilient, and we expect
this to translate into an increased contribution to earnings and revenues.
Green shoots in cobalt demand started emerging post the period driven by
encouraging interest from China's construction sector, which would support a
recovery in cobalt demand."
Analyst conference call and webcast
Jubilee will host a conference call and webcast for analysts at 09:00 am UK
time today, 20 March 2023. To attend the analysts' call please contact
investor relations at jubilee@tavistock.co.uk (mailto:jubilee@tavistock.co.uk)
Investor call
Management will host a presentation and Q&A session for investors at 11:00
am UK time today. Investors can sign up to Investor Meet Company for free at:
https://bit.ly/3kT8Fb9 (https://bit.ly/3kT8Fb9)
Investors who already follow Jubilee Metals on the Investor Meet Company
platform have automatically been invited. Questions can be submitted pre-event
via your Investor Meet Company dashboard up until 9:00 am the day before the
meeting or at any time during the live presentation.
Key operational numbers
6 m 6 m % change 12 m
OPERATIONAL PERFORMANCE Unit 31 Dec 2022 31 Dec 2021 30 Jun 2022 (FY2022)
(H1 FY2023) (H1 FY2022)
Unaudited Unaudited Audited
KEY UNITS OF PRODUCTION
PGM ounces:
- Jubilee own operations Oz 18 208 15 152 20% 35 318
- Third party joint venture Oz - 5 164 (100%) 6 268
Total PGM oz Oz 18 208 20 316 (10%) 41 586
Chrome tonnes Tonne 634 111 619 900 2% 1 222 452
Copper tonnes produced Tonne 1 149 1 314 (13%) 2 593
Copper tonnes sold Tonne 868 1 216 (29%) 2 604
UNIT REVENUE
- PGM revenue per ounce US$/oz 1 453 1 632 (11%) 1 615
- Chrome revenue per PGM ounce US$/oz 2 292 2 042 12% 2 269
Total PGM revenue per ounce US$/oz 3 745 3 675 2% 3 884
Copper revenue per tonne US$/t 6 893 9 527 (28%) 9 210
UNIT COST
Net cost per PGM ounce (after chrome by-product credits) US$/oz 608 540 13% 408
Net cost per copper tonne US$/t 5 232* 5 873 (11%) 5 386
UNIT EARNINGS
Net earnings per PGM ounce US$/oz 845 1 092 (23%) 1 207
Net earnings per copper tonne US$/t 1 661* 3 654 (55%) 3 824
* Cost and net earnings per copper tonne includes disproportionate
copper fixed charges at US$300 per copper tonne produced, to secure full power
allocation for Sable at 100% capacity
Key financial numbers
FINANCIAL PERFORMANCE Unit Unaudited Unaudited Audited
6m to 6m to 12m to
GROUP 31 Dec 2022 31 Dec 2021 30 Jun 2022
Revenue £'000 63 098 63 265 140 007
Attributable earnings((i)) £'000 14 312 19 540 45 337
Adjusted attributable earnings margin((ii)) % 23 31 32
EBITDA £'000 10 286 13 664 36 774
Adjusted EBITDA ((iii)) £'000 11 802 14 916 28 657
Adjusted EBITDA margin % 19 24 22
PGM
PGM £ revenue £'000 22 505 24 330 50 507
PGM US$ revenue US$'000 26 455 33 163 67 135
Attributable PGM £ earnings £'000 10 587 13 064 28 404
Attributable PGM US$ earnings US$'000 12 445 17 807 37 755
Attributable PGM US$ earnings margin % 47 54 56
Total attributable PGM oz sold oz 18 208 20 316 41 586
PGM revenue per ounce US$/oz 1 453 1 632 1 615
PGM production unit cost US$/oz 608 540 408
PGM attributable earnings per ounce US$/oz 845 1 092 1 207
CHROME
Chrome £ revenue((iv)) £'000 35 500 30 436 71 148
Chrome US$ revenue US$'000 41 731 41 487 94 370
Attributable chrome £ earnings £'000 2 501 3 217 9 428
Attributable chrome US$ earnings US$'000 2 940 4 385 12 454
Attributable chrome earnings margin % 7.0 10.6 13.3
Attributable chrome tonnes sold tonnes 634 111 619 900 1 222 452
Chrome earnings per PGM ounce US$/oz 161 216 300
COPPER
Copper £ revenue £'000 5 092 8 499 18 352
Copper US$ revenue US$'000 5 986 11 585 23 983
Attributable copper £ earnings £'000 1 227 3 260 7 505
Attributable copper US$ earnings US$'000 1 442 4 444 9 958
Attributable copper earnings margin % 24.2 38.4 40.9
Attributable copper tonnes sold tonnes 868 1 216 2 604
Copper US$ revenue per tonne sold US$/t 6 893 9 527 9 210
Copper attributable US$ earnings per tonne US$/t 1 661 3 654 3 824
(i) Attributable earnings refer to earnings attributable to the
group based on its contractual rights in each project.
(ii) The increased production of chrome under a fixed margin
contract has the effect of increasing group revenue from the sale of chrome
concentrate while impacting overall group margins.
(iii) Adjusted EBITDA refers to EBITDA adjusted for non-cash expenses
including impairments, fair value adjustments
and foreign exchange profits and losses.
(iv) Chrome revenue is recognised on an ex-works basis after costs of
export logistics including freight, shipping and marketing.
Market review
PGM basket prices and chrome metal prices retreated by approximately 18% per
PGM ounce and 12% per tonne of chrome concentrate, compared with the previous
period. The notoriously volatile chrome markets have seen highly fluctuating
metal prices over the past period, with a strong recovery in metal prices post
the period under review.
Chrome prices remained resilient post the period with logistical constraints
impacting supply. Infrastructure in South Africa, as the largest supplier of
chrome to the ferrochrome industry, remains under pressure which is expected
to continue in the medium term. PGM prices reflect the forecasted global
slowdown of most major economies, which is expected to be balanced by lower
PGM output from the industry. Long term PGM prices remain positive supported
by a squeeze on supply and an expected slow but steady recovery in demand.
Copper prices over the reporting period weakened along with other commodities,
down 11% for the comparable period. Copper prices have since recovered
strongly 13.6% on average compared with the reporting period. Copper
fundamentals remain supportive with a constrained supply and buoyant demand.
The cobalt market remains under pressure with prices contracting sharply with
little guidance on short term pricing, driven by lacklustre demand. Green
shoots in the demand for cobalt have been evident during the current reporting
period driven by increasing interest from the Chinese construction sector.
Long term cobalt prices remain positive driven by the expected recovery in
demand for cobalt in support of the energy transition to battery power and EVs
and a recovering Chinese construction sector.
Operational review
South Africa
The South African operations experienced operational downtime relating to a
regrettable safety incident involving one of our engineering service providers
that sadly resulted in a fatality. The safety of our employees and contractors
is of the highest importance to us and following the incident, Jubilee has
implemented measures to assume a more direct safety management role for its
service providers. The combined South African operations have achieved a lost
time injury frequency rate (LTIFR) of 1.0.
The Company's newly expanded Inyoni Facility continued to perform in line with
expectations despite the initial impacts of power outages. The Company
achieved 18 208 PGM oz for the six months to December 2022 (100% from own
operations). This equates to a 20% increase in PGM ounce from own operations
compared with the previous period. Operational cost net of chrome credits
remained tightly under control at US$608 per PGM ounce, despite a much lower
credit from chrome production due to a softer chrome metal price. Post the
period, chrome prices have appreciated strongly which is expected to
significantly improve the credits from chrome production.
The chrome operations, as a by-product of the PGM operations, continued to
perform strongly, delivering 634 111 tonnes of chrome concentrate over the
period against a targeted 600 000 tonnes.
The period under review highlighted the exposure of the Inyoni Facility to
unscheduled power downtime and the resultant circuit instability, brought on
mainly as a result of interrupted power supply. As a result, Jubilee
implemented its first back-up power units at its chrome facilities to ensure a
more constant feed supply and stable operational performance. The expansion of
the back-up power units is currently under review, with the existing system
already delivering 650 hours of backup power to operations since its
installation in November 2022.
The increase in chrome operational capacity over the period provided Jubilee
with the optionality to increase PGM feed stock levels by 5 016 PGM oz to
better buffer the Inyoni PGM Facility from power outages suffered at the
chrome operations.
The newly enlarged PGM and chrome operations have the capacity to deliver up
to 44 000 PGM oz and 1.2 million tonnes of chrome concentrate per annum from
Jubilee's own capacity.
Due to the continued uncertainty over stable power supply, and the expected
time lag to expand the back-up power supply for operations, and as announced
in the Company's operation update on 15 February 2023, the Company felt it
prudent to update its full-year guidance to 38 000 PGM oz from its own
production for FY2023, with the continued option to add a further 8 000 PGM oz
from third party processing agreements dependent on stock and power
availability.
Jubilee has made good progress with discussions to secure a further PGM
processing footprint in the Eastern Limb of the Bushveld complex (the
north-eastern region of South Africa's chrome and PGM mining region), with
final design reviews completed for the chrome beneficiation facility that will
precede the PGM facility in the Eastern Limb. The Company targets to commence
with the construction of the chrome beneficiation circuit as soon as
regulatory approvals are secured, which is expected during Q3 of the 2023
calendar year. The construction of the circuit is budgeted to be completed
over a 6-month period. The Eastern Limb PGM facility offers the opportunity to
further increase Jubilee's PGM operational footprint by 25 000 PGM ounces.
Zambia
Jubilee completed the construction of its new 780 000 tonnes per annum Roan
copper concentrator as part of its fully integrated Southern Copper Refining
Strategy. The strategy integrates Jubilee's Sable Refinery with the Roan
Concentrator with a total capacity of 12 000 tonnes of copper per annum.
Post completion, the project ramp-up suffered delays brought on mainly by
severe power and water disruptions across Zambia. Through a further investment
of US$2.5 m into plant and equipment, these infrastructure challenges have
been addressed with the project resuming its ramp-up during late February
2023, reaching 80% of capacity by the time of this announcement.
The final phase of the Roan project ramp-up is scheduled for early April 2023
to complete the commercialisation of the Southern Copper Refining project
expected during May 2023. Upon reaching commercial production, the Roan copper
concentrator is expected to contribute 550 tonnes of copper per month to the
production of Sable Refinery with a further 130 tonnes per month of copper
from third party supplies.
The water infrastructure was successfully upgraded in December 2022, with the
implementation of new private infrastructure under licence from the Zambian
authorities, while existing power infrastructure was upgraded, and a new power
supply management plan entered into with the authorities.
Copper production was down 10% on the comparable six months to 1 149 tonnes
and fell below expectation for the period.
These external challenges have effectively prolonged the Zambian development
and ramp-up timeline by an estimated 5 months, with ramp-up now progressing
and expected to reach full output and commercialisation by May 2023.
Northern Copper and Cobalt Refining Strategy and Roan expansion
The upgraded and expanded water and power infrastructure at Roan now offers
the potential to more than double the capacity of the existing 780 000 tonnes
per annum processing capacity allowing it to become a potential central
processing facility for the Group's feed materials.
The Roan operations can be expanded through a phased approach, similar in
concept to the successful expansion implemented at the Inyoni PGM Facility in
South Africa. The initial target is the upgrade of the feed material handling
and classification circuit at Roan to offer the flexibility to simultaneously
process both copper tailings and ROM copper material supplied by third-party
miners. Such an upgrade can be completed within an 8-week period immediately
facilitating the implementation of the first Northern Refining project
tailings project.
Final design reviews are under way by the Jubilee project team, to incorporate
the Roan expansion and simplify the expansion of the Northern Refining
Strategy. It is envisaged that the completed Northern Copper and Cobalt
project will include an expanded Roan Concentrator, along with a new larger
copper concentrator to be centrally located at the Kitwe tailings material.
(Compared to the 3 new concentrating facilities required under the previous
strategy). Smaller satellite upgrade facilities located at the targeted copper
and cobalt tailings will prepare the material for transport to the centralised
two copper concentrators. The concentrate from the two facilities will be
refined in a dedicated Northern copper and cobalt refinery. An existing
refinery is being targeted and discussions have reached an advanced stage to
complete such a transaction. The targeted refinery holds an approximate
capacity of 40 000 tonnes per annum of copper and 5 000 tonnes of cobalt.
The Company will provide further clarity on expected capital investment and
updated timelines for the implementation of the Northern Refining Strategy at
completion of the revised capital program expected by the end of the current
reporting period.
At Sable, Jubilee successfully completed the first cobalt production runs from
waste and looks to increase the capacity to be able to produce 450 tonnes per
month of cobalt hydroxide (125 tonnes of contained cobalt) from recycled waste
alone by the end of May 2023. This additional capability offers Jubilee the
flexibility to pivot between copper and cobalt production guided by prevailing
market conditions.
Outlook
The commercialisation of the completed Southern Copper Refining Strategy has
been delayed by approximately 5 months. Guidance for copper is therefore
revised to align with this delayed ramp-up and commercialisation, which is
expected to reach completion during May 2023.
§ Post commercialisation, Southern Copper Refining projected to maintain 550
tonnes of copper per month from Roan alone and 130 tonnes from third party
supplies
§ Copper guidance for the full year to 30 June 2023 adjusted to 3 000 tonnes
of copper to end June 2023
§ Copper prices remain well supported due to a constrained supply against
strong demand for the metal. Prices up by 13.6% during current period
compared with reporting period.
Financial review
Revenue for the period amounted to £63.1 m (H1 FY2022: £63.3 m) mainly
driven by revenue from the PGM operations inclusive of chrome, which was up
5.9% to £58.0 m (92% of total revenue). Copper revenues were lower at £5.1 m
(H1 FY2022: £8.5 m) mainly due to a 12.5% lower production of copper and a
27.6% pull back in realised copper revenues per tonne produced.
PGM unit cost remained well under control despite inflationary pressure on
power and chemicals, with a unit cost of US$608/oz. This positions the PGM
operations well within the bottom quartile of the industry's PGM cost curve,
ensuring the business remains a strong cash generator despite the volatile
markets.
Operating expenses are down 11.6% to £9.7 m (H1 FY2022: £10.9 m) driven by
strict cost management. The strong operational performance, coupled with tight
cost control measures resulted in cash flow generated from operating
activities for the group increased to £16.9 m (H1 FY2022: £2.3 m). The South
African operations continued to generate strong cashflows during the period
with copper expected to contribute on the completion of the commercialisation
of the Integrated Southern Copper Refining Strategy.
Finance cost includes an amount of £0.7 m as Jubilee continues to invest in
PGM resources and elected to increase its processing stock for its PGM
operations as a precautionary measure against potential increased power
outages while implementing back up power units at its chrome operations.
EBTIDA for the period amounted to £10.3 m (H1 FY2022: £13.7 m) driven lower
mainly by a reduction in metal prices for both PGMs and copper coupled with a
delayed ramp up of Roan copper concentrator.
Adjusted EBITDA for the period amounted to £11.8 m (H1 FY2022: £14.9 m)
driven mainly by foreign exchange losses of £1.9 m (H1 FY2022: £1.8m) due to
significant foreign currency movements over the period.
In South Africa, Jubilee continued to invest in securing further PGM-bearing
resources and as a precautionary measure against potential increased power
outages, elected to increase its processing stock for its PGM operations while
implementing back up power units at its chrome operations. The Company
targets to commence construction of its Eastern Limb operational PGM and
chrome footprint within the next financial period. Construction will initially
focus on the completion of the chrome beneficiation circuit prior to the PGM
operations at a budgeted investment of US$5.5 m.
In Zambia, Jubilee continued with its investment programme in delivering its
Southern Copper Refining Strategy, while simultaneously progressing its
Northern Copper Refining Strategy. As a result of the delay in ramp-up at the
Roan operations at our Southern Refinery complex in Zambia, all capital and
operating costs (net of revenue realised from the sale of some
pre-commercialisation output), have been capitalised in the period under
review. We expect to continue to account for such pre-production operating and
capital costs in the same way until such time as we achieve commercial-scale
production which is expected in May 2023. At Sable the Company brought the
cobalt refining line into production with the completion of the cobalt
hydroxide circuit adding to the operational flexibility.
During the period the Company invested a total of £28.4 m capital in Zambia
which, comprised mostly of the completion of its new 784 000 tonnes per annum
Roan copper concentrator, currently being ramped up as well as pre-production
operating costs (net of revenues). The Company targets to bring the integrated
Southern Copper Refining Strategy into full production during May 2023.
For further information please contact:
Jubilee Metals Group PLC Tel: +27 (0) 11 465 1913
Leon Coetzer
PR & IR Adviser - Tavistock Tel: +44 (0) 20 7920 3150
Jos Simson/ Gareth Tredway
Nominated Adviser - SPARK Advisory Partners Limited Tel: +44 (0) 20 3368 3555
Andrew Emmott/ James Keeshan
Joint Broker - Berenberg Tel: +44 (0) 20 3207 7800
Matthew Armitt/ Jennifer Lee/ Detlir Elezi
Joint Broker - WHIreland Tel: +44 (0) 20 7220 1670/
Harry Ansell/ Katy Mitchell +44 (0) 113 394 6618
JSE Sponsor - Questco Corporate Advisory Pty Ltd Tel: +27 (0) 11 011 9212
Sharon Owens
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2022
Consolidated Statements of Comprehensive Income for the six months ended 31
December 2022
Figures in pound sterling ('000) Unaudited Unaudited Audited
6m to 6m to 12m to
31 Dec 2022 31 Dec 2021 30 Jun 2022
Revenue 63 098 63 265 140 007
Cost of sales (48 786) (43 725) (94 670)
Gross profit 14 312 19 540 45 337
Operating costs (9 651) (10 918) (19 694)
Operating profit 4 661 8 622 25 643
Investment income 845 858 1 401
Fair value adjustments 362 658 914
Finance costs (1 604) (753) (1 445)
Share of loss from associates (0) (48) (7)
Profit before taxation 4 264 9 336 26 506
Taxation (198) (967) (8 134)
Profit for the period 4 066 8 370 18 372
Attributable to:
Owners of the parent 3 928 8 060 18 037
Non-controlling interest 138 310 335
4 066 8 370 18 372
Reconciliation of other comprehensive (loss)/ income:
Other comprehensive (loss)/income
Profit for the period 4 066 8 370 18 372
(Loss)/profit on translation of foreign subsidiaries (7 908) 10 183 16 643
Total comprehensive (loss)/income (3 842) 18 553 35 015
Attributable to:
Owners of the parent (3 840) 18 315 34 467
Non-controlling interest (2) 238 548
(3 842) 18 553 35 015
Weighted average number of shares ('000) 2 664 488 2 345 238 2 455 458
Earnings per share (pence) 2 0.15 0.34 0.73
Diluted profit for the period 3 928 8 389 18 037
Diluted weighted average number of shares ('000) 2 716 128 2 673 482 2 579 402
Diluted earnings per share (pence) 0.15 0.31 0.70
Consolidated Statements of Financial Position as at 31 December 2022
Figures in pound sterling ('000) Unaudited Unaudited Audited
6m to 6m to 12m to
31 Dec 2022 31 Dec 2021 30 Jun 2022
£ '000 £ '000 £ '000
Assets
Non-current assets
Property, plant and equipment 87 840 52 211 69 876
Intangible assets 80 069 61 898 78 466
Investment in associate - 379 -
Investment in joint operations - 9 048 -
Other financial assets 5 14 925 12 381 15 284
Non-current inventory 12 572 - 12 507
Deferred tax 4 188 10 709 4 346
Total non-current assets 199 595 146 627 180 478
Current assets
Inventories 32 988 18 955 27 736
Other financial assets 462 828 702
Current tax 1 213 351 991
Trade and other receivables 47 064 56 749 48 821
Contract assets ((i)) 7 729 7 733 18 876
Cash and cash equivalents 11 708 21 494 16 018
Total current assets 101 163 106 109 113 143
Total assets 300 757 252 736 293 621
Equity and liabilities
Share capital 6 157 578 148 628 155 539
Reserves 15 736 16 890 23 504
Retained income 28 731 14 814 24 803
Total equity before non-controlling interest 202 045 180 332 203 846
Non-controlling interest 3 708 3 400 3 710
Total equity 205 753 183 732 207 556
Non-current liabilities
Other financial liabilities 2 803 2 803 2 803
Lease liability 191 547 360
Deferred tax liability 16 463 11 419 18 221
Long term provisions 891 1 067 929
Total non-current liabilities 20 349 15 837 22 314
Current liabilities
Other financial liabilities - 5 298 1
Trade and other payables 55 815 36 755 52 632
Revolving credit facility 15 906 7 008 8 471
Current tax payable 2 936 4 106 2 648
Total current liabilities 74 657 53 166 63 752
Total liabilities 95 005 69 003 86 065
Total equity and liabilities 300 757 252 736 293 621
(i) Revenue recognised at the period end for inventories sold and
delivered, but subject to final pricing are recognised as contract assets
Consolidated Statements of Changes in Equity as at 31 December 2022
Figures in pound sterling ('000) Share capital Merger reserve Share based payment reserve Convertible instrument reserve Currency translation reserve Total reserves Retained earnings Total attributable to parent of equity holders Non-controlling interest Total equity
Balance at 1 July 2021 120 013 23 184 2 708 203 (19 482) 6 613 6 754 133 380 3 163 136 543
Profit for the year - - - - - - 18 037 18 037 548 18 585
Other comprehensive income - - - - 16 430 16 430 - 16 430 - 16 430
Total comprehensive income for the period - - - - 16 430 16 430 34 467 34 467 547 35 015
Issue of share capital net of costs 35 129 - - - - 35 129 - 35 129
Share warrants exercised 20 - (20) - - (20) - - -
Share warrants issued - - 23 - - 23 - 23 - 23
Share options exercised/lapsed 173 - (185) - - (185) 12 - - -
Share options granted 847 847 847 847
Transfer between reserves 203 (203) - (203) - - - -
Total changes 35 525 - 664 (203) 16 430 16 891 18 049 70 466 547 71 013
Balance at 1 July 2022 155 539 23 184 3 372 - (3 052) 23 504 24 803 203 846 3 710 207 556
Profit for the year - - - - - - 3 928 3 928 (2) 3 926
Other comprehensive income - - - - (7 768) (7 768) - (7 768) - (7 768)
Total comprehensive income for the period - - - - (7 768) (7 768) 3 928 (3 840) (2) (3 842)
Issue of share capital net of costs 2 039 - - - - - - 2 039 2 039
Total changes 2 039 - - - (7 768) (7 768) 3 928 (1 801) (2) (1 083)
Balance at 31 December 2022 157 578 23 184 3 372 - (10 820) 15 736 28 731 202 045 3 708 205 753
Consolidated Statements of Cash flow for the six months ended 31 December 2022
Figures in pound sterling ('000) Unaudited Unaudited Audited
6m to 6m to 12m to
31 Dec 2022 31 Dec 2021 30 Jun 2022
Cash flows from operating activities
Profit before taxation 4 264 9 336 26 506
Adjustments for: - - -
Depreciation and amortisation 4 648 4 432 10 223
Investment income (845) (858) (1 401)
Finance cost 1 604 753 1 445
Results from equity accounted investments - 48 7
Share based payments - 23 869
Fair value adjustments (362) (658) (914)
Other movements (38) 347 209
Effect of exchange rate movement on cash balances (1 688) - 6 264
Working capital changes
Inventories (5 317) (1 189) (9 970)
Trade and other receivables 13 034 (17 202) (21 629)
Trade and other payables 4 266 7 416 23 293
Cash generated from operations 19 565 2 448 34 901
Investment income 845 858 1 401
Finance cost (1 604) (753) (1 445)
Taxation paid (1 847) (210) (3 852)
Net cash from operating activities 16 959 2 343 31 005
Cash flows from investing activities
Purchase of property, plant and equipment (26 539) (18 600) (36 452)
Sale of property, plant and equipment 11 - -
Purchase of intangible assets (3 706) (1 945) (15 663)
Increase in other financial assets (253) (5 431) -
Investment in joint ventures - (9 048) -
Purchase of non-current inventory - - (12 507)
Net cash used in investing activities (30 486) (35 023) (64 621)
Cash flows from financing activities
Proceeds from share issues net of costs 2 039 28 615 35 129
Proceeds from revolving credit facilities 7 435 3 169 4 632
Increase in loans to joint ventures - - (6 934)
(Decrease)/Increase in other financial liabilities (1) 618 (4 062)
Finance lease payments (168) (341) (588)
Net cash generated from financing activities 9 304 32 061 28 177
Net decrease in cash and cash equivalents (4 223) (620) (5 439)
Cash and cash equivalents at beginning of the period 16 018 19 643 19 643
Effects of foreign exchange on cash and cash equivalents (87) 2 471 1 814
Cash and cash equivalents at the end of the period 11 708 21 494 16 018
NOTES TO THE UNAUDITED INTERIM RESULTS
1. Basis of
preparation
The Group unaudited interim results for the 6 months ended 31 December 2022
have been prepared using the accounting policies applied by the company in its
30 June 2022 annual report which are in accordance with International
Accounting Standards in conformity with the requirements of the Companies Act
2006 issued by the International Accounting Standards Board ("IASB") as
adopted for use in the EU ("IFRS, including the SAICA financial reporting
guides as issued by the Accounting Practices Committee, IAS 34 - Interim
Financial Reporting, the Listings Requirements of the JSE Limited, the AIM
rules of the London Stock Exchange and the Companies Act 2006 (UK)). This
condensed consolidated interim financial report does not include all notes of
the type normally included in an annual financial report. Accordingly, this
report is to be read in conjunction with the annual report for the year ended
30 June 2022 and any public announcements by Jubilee Metals Group PLC. All
monetary information is presented in the presentation currency of the Company
being Great British Pound. The Group's principal accounting policies and
assumptions have been applied consistently over the current and prior
comparative financial period. The financial information for the year ended 30
June 2022 contained in this interim report does not constitute statutory
accounts as defined by section 435 of the Companies Act 2006. A copy of the
statutory accounts for that year has been delivered to the Registrar of
Companies. The auditor's report on those accounts was unqualified and did not
contain a statement under section 498(2)-(3) of the Companies Act 2006.
2. Financial review
Earnings per share for the six months ended 31 December 2022 are presented as
follows:
Figures in pound sterling ('000) Unaudited Unaudited Audited
6m to 6m to 12m to
31 Dec 2022 31 Dec 2021 30 Jun 2022
Earnings for the period 3 928 8 060 18 037
Weighted average number of shares in issue ('000) 2 664 488 2 345 238 2 455 458
Diluted weighted average number of shares in issue ('000) 2 716 128 2 673 482 2 579 402
Earnings per share (pence) 0.15 0.34 0.73
Diluted earnings per share (pence) 0.14 0.31 0.70
The Group reported a net asset value of 7.6 (H1 FY2022: 7.6) pence per share
and a net tangible asset value per share of 4.6 pence (H1 FY2022: 5.0) per
share. The total number of shares in issue as at 31 December 2022 were
2 694 854 150 (H1 FY2022: 2 429 658 564).
3. Dividends
No dividends were declared during the period under review (H1 FY2022: nil).
4. Business
segments
Following the strategic restructuring of Jubilee's operations and business
model management presents the following segmental information:
§ PGM and Chrome - the processing of PGM and chrome containing materials;
§ Copper and Cobalt - the processing of Copper and Cobalt containing
materials; and
§ Other - administrative and corporate expenses and exploration.
The Group's operations span five countries South Africa, Australia, Mauritius,
Zambia, and the United Kingdom. There is no difference between the accounting
policies applied in the segment reporting and those applied in the Group
financial statements. Madagascar does not meet the qualitative threshold under
IFRS 8 consequently no separate reporting is
provided.
Segment report for the 6 months ended 31 December 2022
PGM and Chrome Copper and
Figures in pound sterling ('000) Cobalt Other Total
Total assets 134 973 95 407 70 378 300 758
Total liabilities 46 188 27 674 21 144 95 005
Total revenues 58 006 5 092 - 63 098
Gross profit 13 084 1 228 - 14 312
Forex losses - operations 3 6 1 -
Profit/(loss) before taxation 5 783 (994) (525) (892)
Taxation (44) (81) (73) -
Profit/(loss) after taxation 5 739 (1 075) (598) (892)
Interest received 399 - 446 9
Interest paid (1 129) (475) - -
Depreciation and amortisation (3 507) (973) (167) -
Segment report for the 6 months ended 31 December 2021
PGM and Chrome Copper and
Figures in pound sterling ('000) Cobalt Other Total
Total assets 120 414 63 690 68 579 252 736
Total liabilities 56 777 4 041 8 185 69 003
Total revenues 55 457 7 808 - 63 265
Gross profit 17 403 2 056 (18) 19 541
Profit/(loss) before taxation 11 506 (1 275) (839) 9 392
Taxation (652) (314) - (967)
Profit/(loss) after taxation 10 854 (1 589) (839) 8 426
Interest received 279 (0) 579 858
Interest paid (321) (396) (0) (717)
Depreciation and amortisation (2 841) (487) (1 104) (4 432)
Segment report for the year ended 30 June 2022
PGM and Chrome Copper and
Figures in pound sterling ('000) Cobalt Other Total
Total assets 124 126 101 905 60 854 286 885
Total liabilities 51 291 13 309 14 729 79 329
Revenue 121 655 18 352 - 140 007
Gross profit 37 832 7 504 - 45 337
Depreciation and amortisation (7 554) (1 387) (1 282) (10 223)
Operating profit 25 508 4 208 (4 073) 25 643
Investment revenue 588 796 16 1 401
Fair value - 581 333 914
Net finance costs (828) (618) - (1 445)
Income from equity accounted investments - - (7) (7)
Profit before taxation 25 269 4 967 (3 730) 26 506
Taxation (6 488) (536) - (8 134)
Profit after taxation 18 781 4 432 (3 730) 18 372
5. Other financial
assets
Unaudited Unaudited Audited
Figures in pound sterling ('000) 6m to 6m to 12m to
31 Dec 2022 31 Dec 2021 30 Jun 2022
At fair value through profit or loss - designated
Kendrick Resources Limited 60 - 60
Loans and receivables
Horizon Corporation Limited - Star Tanganika 4 451 4 027 4 303
Horizon Mining Limited - Kitwe Project 9 259 7 383 8 548
Mash Rock Mining (Pty) Ltd 478 435 458
PlatCro Minerals (Pty) Ltd - - 1 214
Amava Minerals 491 593 702
Kgato Investments (Pty) Ltd 646 536 670
Other - 235 30
Total other financial assets 15 386 13 209 15 985
Comprising:
Current assets
Loans receivable 491 828 702
Non-current assets
Loans receivable 14 775 12 381 15 223
At fair value through profit or loss 60 - 60
14 835 12 381 15 283
Total other financial assets 15 386 13 209 15 985
6. Share Capital
and warrants
The share capital of the Company is divided into an unlimited number of
ordinary shares of £0.01 each.
Figures in pound sterling ('000) Unaudited Unaudited Audited
6 m 6 m 12 m
ended 31 December ended 31 December ended 30
June
2022 2021 2022
Ordinary shares of 1 pence each 26 949 24 297 26 571
Share premium 130 629 124 331 128 968
Total issued capital 157 578 148 628 155 539
During the period under review the Company issued the following new Jubilee
ordinary shares:
Number of shares ('000) Issue price Purpose
(pence)
Opening balance 2 657 051
07 July 2022 25 6.12 Warrants
22 July 2022 1 439 6.12 Warrants
01 September 2022 8 510 6.12 Warrants
01 September 2022 4 660 6.12 Warrants
21 September 2022 2 500 3.38 Warrants
10 November 2022 2 500 3.38 Warrants
24 November 2022 4 660 6.12 Warrants
28 November 2022 8 510 6.12 Warrants
21 December 2022 5 000 3.38 Warrants
Balance at the end of the period 2 694 855
Post the period under review the Company issued the following new Jubilee
shares:
Number of shares ('000) Issue price Purpose
(pence)
Opening balance 2 694 855
18 January 2023 32 159 6.12 Warrants
23 January 2023 366 6.12 Warrants
Balance at the end of the period 2 727 380
Warrants
At the period end and at the date of this report the Company had the following
warrants outstanding:
Number of warrants Issue date Subscription price (pence) Expiry date Share price at issue date (pence)
750 000 2020/06/22 3.40 2023/06/22 3.90
4 036 431 2021/01/21 13.00 2024/01/21 13.20
4 786 431
At 30 June 2022 the Company had the following warrants outstanding:
Number of warrants Issue date Subscription price (pence) Expiry date Share price at issue date (pence)
63 661 944 2018/01/19 6.12 2023/01/19 3.55
10 000 000 2018/12/28 3.38 2023/01/19 2.40
7 818 750 2019/11/19 4.00 2022/11/19 4.13
750 000 2020/06/22 3.40 2023/06/22 3.90
4 036 431 2021/01/21 13.00 2024/01/21 13.20
86 267 125
7. Going concern
The financial position of the Group, its cash flows, liquidity position and
debt facilities are set out in the Group's condensed consolidated interim
results for the six months ended 31 December 2022. The Group reported a cash
position of £11.7 m at the period end (H1 FY2022: £22.5 m and 30 June 2022:
£16.0 m).
The Group meets its day‐to‐day working capital requirements through cash
generated from operations and trade finance facilities. The current global
economic climate creates to some extent uncertainty particularly over:
§ the trading price of metals; and
§ the exchange rate fluctuation between the US$, ZAR, ZMK and GBP and thus
the consequence for the cost of the company's raw materials as well as the
price at which product can be sold.
The Group's forecasts and projections, taking account of reasonably possible
changes in trading performance, commodity prices and currency fluctuations,
indicates that the Group should be able to operate within the level of its
current cash flow earnings forecasted for the next twelve months.
The Group is adequately funded and has access to further facilities, which
together with contracts with several high-profile customers strengthens the
Group's ability to meet its day-to-day working capital requirements and
capital expenditure requirements. Therefore, the directors believe that the
Group is suitably funded and placed to manage its business risks successfully
despite identified economic uncertainties.
The directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable future,
thus continuing to adopt the going concern basis of accounting in preparing
the interim financial statements.
8. Events after
the reporting date
8.1 Share issues
During the period under review the Company issued 37 802 780 new Jubilee
shares pursuant to warrants exercised during the period. For details of the
share issues refer to note 6 above.
8.2 Revolving credit facilities
Jubilee secured a revolving credit facility ("RCF") with ABSA BANK LIMITED for
£15 m (ZAR300 m). The RCF is secured as follows:
§ Borrower security cession and pledge over the issued capital of Windsor SA
and its assets;
§ Parent Shareholder Pledge and Cession from Jubilee including all
shareholder loan claims; and related rights; and
§ General Notarial Bond registered over relevant assets of Windsor SA
On 14 March 2023 the RCF was renewed for a further period of 12 months and can
be extended for a further 12 months by mutual agreement and bears interest at
the aggregate rate of JIBAR plus a margin of 2.8%.
9. Unaudited
results
These interim results have not been reviewed or audited by the Group's
auditors.
10. Interim report
From the date of this report copies of the interim report are available for
download from the Company's website www.jubileemetalsgroup.com
(http://www.jubileemetalsgroup.com)
United Kingdom
20 March 2023
Annexure 1
Headline earnings per share ("HEPS") is calculated using the weighted average
number of shares in issue during the period under review and is based on
earnings attributable to ordinary shareholders, after excluding those items as
required by Circular 1/2021 issued by the South African Institute of Chartered
Accountants (SAICA). In compliance with paragraph 18.19 (c) of the JSE
Listings Requirements the table below represents the Group's Headline earnings
and a reconciliation of the Group's loss reported and headline earnings used
in the calculation of headline earnings per share:
Reconciliation of headline earnings per share: Unaudited Unaudited Audited
Figures in pound sterling ('000) 6 m 6 m 12 m
Dec-22 Dec-21 Jun-22
Profit attributable to ordinary equity holders of the parent 3 928 8 060 18 037
Adjusted for:
Share of impairment loss of equity accounted associate - - 6
Fair value adjustments (362) (658) (914)
Total tax effects of adjustments - - (2)
Headline earnings 3 567 7 402 17 128
Weighted average number of shares in issue ('000) 2 664 488 2 345 238 2 455 458
Diluted weighted average number of shares in issue ('000) 2 716 128 2 673 482 2 579 402
Headline earnings per share (pence) 0.13 0.32 0.70
Headline earnings per share (ZAR cents) 2.72 6.46 14.11
Diluted headline earnings per share (pence) 0.13 0.31 0.66
Diluted headline earnings per share (ZAR cents) 2.67 6.42 13.43
Average conversion rate used for the period under review £:ZAR 0.049 0.049 0.049
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