Jubilee Metals shares rise on double-digit growth in profit

Jubilee Metals shares rise on double-digit growth in profit
JOHANNESBURG - Jubilee Metals rose nearly 5percent on the JSE yesterday after the metal recovery business told the market that it had recorded double-digit growth in profits for the year to June 2019 on the back of a broad commodity basket.

Jubilee, whose operations are based in six countries, including South Africa and Zambia, reported a £4.87 million (R93.41m) operating profit from R1.04m in 2018 with an operating margin of 20.64percent.

Group revenue jumped 66.81percent to £23.59m with its newly acquired Windsor Chrome Operations delivering 149272 tons of chrome concentrate since January 2019 and generating revenue of £5.75m.

Jubilee did not declare any dividends for the period.

Non-executive chairperson Colin Bird said that the group realised the stronger profit on the back of the successful implementation of a defined strategy.

Bird said the group expanded its operational, jurisdictional and earnings footprint, resulting in a current portfolio of five operations in South Africa and Zambia.

“A defined and valuable metal inventory, exposure to a broad commodity basket that includes PGMs, chrome, copper, lead, zinc, vanadium and cobalt and a sharp swing from an operating loss to an operating profit to £4.87m,” said Bird.

Bird said that the group was looking at a number of acquisitions.

“This is a truly exciting time for Jubilee Metals. We have a robust project pipeline and acquisition opportunities to augment our rapid growth strategy and believe our unique positioning, technical know-how and team will enable us to create significant further value for shareholders,” Bird said.

Highlights included the positive earnings of £7m from a £2.11m loss in 2018. The return on equity was 10.50percent compared to a negative return of 3.67percent in the previous year.

Earnings a share were 0.48pence per share from a loss of 0.18p in 2018. Total project attributable earnings almost doubled to £9.87m from £5.03m in 2018.

During the period under review, Jubilee entered into a share purchase agreement for the acquisition of the Sable Zinc refinery in Kabwe, Zambia, adjacent to the large stockpiles of zinc, lead and vanadium that Jubilee has contracted from BMR Group plc.

It also acquired 100percent of the rights to PGM earnings from the current and future tailings produced at Jubilee’s Inyoni Operations, previously Hernic.

Jubilee rose 1.18percent on the JSE yesterday to close at R0.86.