Jubilee upbeat about outlook for copper, PGM markets

Metals processor Jubilee Metals Group sees a rosy outlook for the copper and platinum group metal (PGM) markets in the years ahead.

“The outlook for copper, in particular, remains buoyant, with many predictions that 2030 will see a doubling in demand for copper. I for one, see the supply side being severely challenged, with Chile as a major contributor to the copper supply, being challenged technically and socially.

“The large copper systems that are now in favour are few and far between and have a gestation period of some 12 years. The lack of big projects being developed will, to me, facilitate smaller copper production from both surface and underground mines,” Jubilee chairperson Colin Bird notes in a statement issued following the group’s annual general meeting on December 2.

He adds that the inability of supply to keep up with demand is likely to keep the price of copper above $8 500/t.

“We do, however, anticipate that prices may exceed $11 000/t during 2023 and beyond.

“The possession of copper secondaries, mined and on surface gives Jubilee a very good position in tomorrow’s copper production and promises superior returns to its shareholders,” Bird says.

Further, he says the emergence of the fuel cell, particularly in China, will underpin PGM prices and increase the price as demand for fuel cell energy increases over the coming years.

Meanwhile, Jubilee’s adjusted earnings a share for the year ended June 30, increased by 163% year-on-year to 2.25p, while revenue increased by 143% year-on-year to £133-million.

Earnings a share were up 93%, to 1.81p for the period.

Attributable operational earnings growth of 183% to £71-million was achieved, with a return on equity of about 35.4%, compared with 21.2% in the previous year.

Adjusted profit before tax was up by 324% to £52-million. Profit after tax adjusted for noncash expenses, including impairments, gained on bargain purchase and share-based payments up 194% to £49-million (R1-billion).

Revenue and earnings growth, meanwhile, were achieved during a period of substantial infrastructure investment, integration and planned operational downtime and has provided a tremendous platform for further future growth.

During the period, Jubilee delivered strong cash flows from operating activities of £23.8-million.

During the year under review, a total of £19.8-million was invested in acquisitions and purchases of property, plant and equipment compared with the previous year’s total investment of £26.1-million, while a further £1.8-million of external debt obligations were repaid.

OPERATIONAL HIGHLIGHTS

During the period, Jubilee achieved its stated target of producing 50 162 oz of PGMs for 2021, which was up 23% compared with the 40 743 oz produced in 2020. This, the company says, was achieved during a period that included the construction and commissioning of two new chrome beneficiation facilities and the commencement of the construction of the expanded and refocused Inyoni PGMs operation.

The chrome operations delivered 751 223 t of chrome concentrate, generating revenue of £34.5-million on the back of increased operational capacities. Jubilee says this is set to increase further with the start of commissioning of the new chrome beneficiation circuit completed during the second quarter.

Jubilee also secured the rights to a further 150-million tonnes of copper-containing surface tailings, targeted to be upgraded at site before refining at Jubilee’s targeted Northern Refinery in Zambia.

This will be done through a joint operation with the mining rights’ holder.

Project Elephant alone holds the potential to produce copper concentrates in excess of the total Sable Refinery capacity of 14 000 t/y of copper cathode.

Copper production, meanwhile, reached 2 026 t since commissioning as part of enabling operational readiness to accept first copper concentrate production from Project Roan. Project Roan’s integrated copper concentrator is on track for commissioning by January.

The Sable refinery achieved positive earnings as part of its operational readiness activities, with attributable operating earnings of £3.7-million for 2021 compared with £1.2-million for 2020.