INTEGRATED INNOVATION August/September 2017
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 “Company”), its subsidiaries (together, the “Group”) nor any of the Group’s directors, officers, employees, agents or advisers makes any representation or warranty in respect of the fairness, accuracy or completeness of the information or opinions contained in this presentation and no responsibility or liability will be accepted in connection with the same. The information contained herein is provided as at the date of this presentation and is subject to updating, completion, revision, verification and further amendment without notice. These Presentation Materials contain forward-looking statements in relation to the Group. By its very nature, such forward-looking information requires the Company to make assumptions that may not materialise or that may not be accurate. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the control of the Company that could cause the actual performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Nothing in this presentation should be construed as a profit forecast. Past share performance cannot be relied on as a guide to future performance. 2
THARISA AT A GLANCE Innovative • Strategically positioned as a low cost a co-producer of PGM and chrome concentrates • Mine 5 MG chromitite reef layers • Large scale open pit operation with 18 years open pit LOM + 40 year underground extension • Benefit from controlling an integrated mine-to-market value chain Established • 11 years old, listed on JSE and LSE • One of the world’s single largest resource of chrome • Will produce 147.4 koz PGMs and 1.3 Mt chrome concentrates in 2017 • Are the fifth largest producer of chrome concentrate • Derisked with major mine development capital investment already complete Focused • Lowest cost quartile in PGM and chrome industry • Cash generative , dividend payer • A solid platform underpinned by an optimised operating model • Profitable in all commodity environments 3
THARISA’S JOURNEY DISCOVERING DEVELOPING DELIVERING SENIOR PRE IPO LISTING TOTAL SEED CAPITAL CAPITAL DEBT US$245m US$48m US$482m US$65m FUNDING US$123m H1 2004 2006 2009 2011 2012 2013 2008 2014 2016 2017 PROSPECTING PROSPECTING MINING FIRST GENESIS VOYAGER CHALLENGER LISTED ON JSE LISTED ON LSE RECORD HEPS RIGHTS RIGHTS RIGHTS CHROME PLANT PLANT PLANT US$ 16 CENTS APPLICATIONS GRANTED GRANTED CONCENTRATE COMMISSIONED COMMISSIONED COMMISSIONED DIVIDEND PAYMENT PRODUCTION FROM PILOT PLANT Mining 4.8 Mtpa PGM concentrate of 147.4 kozpa Chrome concentrates of 1.3 Mtpa 4
OUR OPERATIONS 5
VALUE CHAIN THARISA MINERALS RESOURCE MINING PROCESSING MID TIER OPEN PIT PGM AND 877.7 Mt resource 18 year open pit LOM 400 ktpm nameplate capacity CHROME CONCENTRATE CO- 98.9 Mt reserve of which 80.2 Mt 40 year underground extension Genesis Plant (100 ktpm) open pit Voyager Plant (300 ktpm) PRODUCER WITH AN INTEGRATED MARKETING, SALES, AND LOGISTICS LARGE SCALE MECHANISED DERISKED PLATFORM One of the world’s largest single chrome Mechanised open pit mining with a In production, major capex complete resources skilled and small labour force Steady state production of 147.4 koz PGMs and 1.3 Mt of chrome concentrates ARXO RESOURCES/DINAMI ARXO LOGISTICS ARXO METALS CUSTOMERS AGREEMENTS BENEFICIATION MARKETING AND SALES LOGISTICS PGM offtake – Impala Platinum Production of specialty grade Significant trader of chrome Road/rail transport, warehouse Specialty offtake/agency – Rand York chrome concentrates and port facilities for bulk chrome concentrates to China Metallurgical agency – Tisco and the Global reach for specialty chrome concentrates Noble Group R&D concentrates Road transport of PGMs Relationships with stainless steel and New technology assessment ferrochrome producers 6
MINING FIVE MG SEAMS RESOURCES AND RESERVES GENERALISED CROSS SECTION SHOWING THE MG CHROMITITE LAYERS AT PLANNED DEPTH Steady state mining rate of 5.0 Bench = 20m Mtpa with an average stripping ratio of 9.7 (m 3 :m 3 basis) MINERAL RESOURCE 200m 877.7 Mt Reef dip east: 9-12° 53 ° 1.58 g/t 6PGE+Au Reef dip west: 14-18° 5.5 km strike length 20.5% Cr 2 O 3 MINERAL RESERVE Far West pit 98.9 Mt 1.50 g/t 5PGE+Au East pit West pit 20.1% Cr 2 O 3 Central East pit Far East pit OPEN PIT MINERAL RESERVE 80.2 Mt 1.49 g/t 5PGE+Au 20.3% Cr 2 O 3 Declaration as at 30 September 2016 7
INNOVATIVE APPROACH 8
SPECIALTY CHROME ↑ 27.9% YTD OPERATIONAL HIGHLIGHTS PRODUCTION 239.6 kt (*2016: 187.3 kt) PGM PRODUCTION CHROME CONCENTRATE REEF MINED PRODUCTION ↑ 3.6% ↑ 11.9% ↑ 6.5% 970.7 kt 3 724.3 kt 104.6 koz (*2016: 911.5 kt) (*2016: 3 594.0 kt) (*2016: 93.5 koz) CHROME RECOVERY REEF MILLED PGM RECOVERY ↑ 6.7% ↑ 3.0% ↑ 19.8% 79.3% 64.3% 3 616.8 kt (*2016: 66.2%) (*2016: 62.4%) (*2016: 3 389.2 kt) *Nine months to end June 2016 9
OPERATIONAL PERFORMANCE YTD Quarter on quarter Nine months Quarter ended Quarter ended movement Quarter ended ended 30 Jun 2017 31 Mar 2017 % 30 Jun 2016 30 Jun 2017 Reef mined kt 1 275.2 1 219.2 4.6 1 235.4 3 724.3 Stripping ratio m³ waste/m³ reef 6.9 7.5 7.4 7.8 Reef milled kt 1 199.1 1 211.3 (1.0) 1 192.2 3 616.8 PGM flotation feed tonnes kt 866.0 897.9 (3.6) 929.6 2 648.9 PGM rougher feed grade g/t 1.57 1.56 0.6 1.64 1.55 6E PGMs produced koz 35.4 34.3 3.2 33.5 104.6 PGM recovery % 81.3 76.2 6.7 68.5 79.3 Average PGM contained metal basket price US$/oz 792 783 1.1 745 771 Average PGM contained metal basket price ZAR/oz 10 443 10 355 0.8 11 162 10 352 Cr₂O₃ ROM grade % 17.8 17.5 1.7 17.7 17.6 Chrome recovery % 66.0 62.5 5.6 61.6 64.3 Chrome yield % 27.8 26.0 6.9 25.8 26.8 Chrome concentrates produced kt 333.9 314.6 6.1 307.1 970.7 Metallurgical grade kt 246.8 239.2 3.2 225.6 731.1 Specialty grades kt 87.1 75.4 15.5 81.5 239.6 Metallurgical grade chrome concentrate contract price US$/t CIF China 147 338 (56.5) 105 212 Metallurgical grade chrome concentrate contract price ZAR/t CIF China 1 892 4 430 (57.3) 1 589 2 844 Average exchange rate ZAR:US$ 13.2 13.2 - 15.0 13.5 10
OUR FINANCIALS 11
STRONG FINANCIAL PERFORMANCE HEPS ↑ 103.6% ↑ 451.0% ↑ 1 500.0% GROUP REVENUE EBITDA 80.00% 100 25 US$ millions US$ millions US$ cents 78.00% 50.00% 300.0 76.00% 47.0% 74.00% 90 72.00% 20 70.00% 45.00% 81.0 16 68.00% 246.8 240.7 66.00% 250.0 80 64.00% 15 40.00% 62.00% 219.6 60.00% 215.5 58.00% 70 56.00% 10 35.00% 54.00% 6 200.0 52.00% 50.00% 175.1 48.00% 60 46.3% 5 30.00% 2 46.00% 44.00% 42.00% 24.8% 40.00% 50 43.0 0 150.0 25.00% 38.00% 36.00% 34.00% 20.00% 40 32.00% -5 30.00% 17.5% 29.0 28.00% 100.0 26.00% 15.00% 30 24.00% -10 13.5% 22.00% 12.0% 19.6% 20.00% 16.5 18.00% 10.00% 13.9 16.00% 20 -15 50.0 14.00% 11.8% 12.00% 10.00% 5.00% 6.9% (19) 8.00% 10 6.5% -20 ZAR:US$ 9.2 10.6 12.0 14.8 13.6 (20) 6.00% 4.00% 0.00% 2.00% - 0.00% 0 -25 FY2013 FY2014 FY2015 FY2016 H1 H1 FY2017 FY2013 FY2014 FY2015 FY2016 H1 H1 FY2017 FY2013 FY2014 FY2015 FY2016 H1 H1 FY2017 Gross profit margin EBITDA margin Six months to end June 2017 12
CHROME SHARED COSTS PGM SHARED COSTS INCREASING MARGINS 25% 75% (2016: 50%) (2016: 50%) PGM REVENUE AND GROSS PROFIT MARGIN CHROME REVENUE AND GROSS PROFIT MARGIN US$ millions US$ millions 170.4 180.0 70.00% 90.00 70.00% 83.1 163.7 161.2 81.5 160.0 80.00 60.00% 60.00% 138.1 70.4 135.1 140.0 70.00 50.00% 50.00% 47.8% 120.0 60.00 54.3 44.5% 40.00% 40.00% 100.0 50.00 40.0 80.0 40.00 29.6% 30.00% 30.00% 24.0% 23.1% 60.0 21.9% 30.00 20.00% 20.00% 14.6% 40.0 13.7% 20.00 9.2% 10.00% 10.00% 20.0 7.0% 10.00 - 0.00% 0.00% - FY2013 FY2014 FY2015 FY2016 H1 FY2017 FY2013 FY2014 FY2015 FY2016 H1 FY2017 CHROME CONCENTRATE SALES VOLUME [kt] PGM SALES VOLUME [koz] 1 196 132.9 1 159 1 122 119.9 1 018 80.4 69.3 502.4 56.9 US$165 US$158 US$158 US$120 US$278 Chrome price US$1132 US$1103 US$736 US$760 US$885 PGM price [US$/tonne] [US$/oz] FY2013 FY2014 FY2015 FY2016 H1 FY2017 FY2013 FY2014 FY2015 FY2016 H1 FY2017 Six months to end June 2017 13
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