Gareth Burchell, Head of Stockbroking at Shard Capital caught up with Leon Coetzer, Chief Executive Officer of Jubilee Metals, following the recent release of their half year interim results (to 31 Dec 2017). Up for discussion was Jubilee’s recently released financial results, company name change and business strategy moving forward.
Leon, back in December the company changed their name to Jubilee Metals. What prompted you to make that decision?
The significance of the name change from Jubilee Platinum to Jubilee Metals Group seemed to have been lost on the market. We are expanding into several commodities and across several jurisdictions as our innovated approach to the recovery of metals from waste is gaining traction. We need to keep running hard to secure these projects as we alert the industry to the untapped potential lying on the ground, adjacent to their operations.
What other metals can JLP process?
The simplest metals that fall within the existing processing recipes include –
- Base Metals – Copper, Nickel, Cobalt, Lead, Zinc, Vanadium, Iron and Chrome
- Precious Metals – PGM’s and Gold
We continue to invest into our process development as to improve the efficiencies of the metals recovery process. We have a very strong core expertise in processing which allows us to adapt our processes very quickly to suit an identified opportunity.
We note your financial results released earlier this month, can you give us an overview of the key highlights?
Our key target as a board was to reach a profitable earnings position at group level since we were already delivering positive cashflows at the operational level. We view this as a key hurdle to ensure the company is in a self-sustaining cash position, which allows us to schedule our capital expenditure to bring our projects to fruition.
The company has a healthy cash balance that we can utilise towards the refinement of our processes and invest to secure further opportunities. Our goal for the company, is to secure a strong pipeline of projects in our targeted metal group that we can execute in time.
The key standout features include –
- The group has delivered significant positive cash earnings (after all in cash expenditure) for the 6-month period in excess of GBP 1.5million
- We invested GBP 14million into surface which includes acquiring assets, building plants and developing processes. This illustrates our commitment to growing our project pipeline.
- This was all done with only GBP 1.8million of debt remaining in the group
- Our Hernic project is already one of the lowest cost producers of Platinum in the world. The first quarter of 2018 has continued to show growth in the ounces delivered, with February delivering records ounces after a slow January
- Numbers for the first 2 months of 2018 show that the earnings numbers are set to grow further
You’re clearly making progress, but your share price is suffering. Do you know why that is?
The market seems to always link us to the platinum industry and its performance; we are also given a discount due to the South African factor. The unexpected BMR news caused a fall in our share price with uncertainty to the future of the project.
In our view, the price we are at really doesn’t reflect the progress we have made over the past 2 years. Moving from a company with only targeted projects and in a cash burning position, to delivering a company with two profitable operations and significant positive cash earnings for the last 6 month reported period.
In addition, we have a pipeline of further projects to deliver further growth. We are trying to communicate with the market through interviews like this, podcasts, research and RNS’s to help tackle this problem.
Investors were very frustrated with the BMR/Kabwe deal and questioned the board’s due diligence process which didn’t help your price at all. Why wasn’t this picked up at DD stage?
Jubilee conducted both a technical and legal DD. The legal DD included a legal opinion by an international legal firm on the status of the mining rights and environmental permits. The threat of a cancellation notice, nor any previous communications on the matter were never disclosed.
In follow-up discussions with BMR, they indicated that they had not thought it to be significant as they were of the view that the matter had been fully addressed. I have had direct discussion with the Zambian Ministry of Mines and the matter has been escalated to ensure it receives their immediate attention. We have assisted BMR to prepare the appeal and have assured the Ministry of our support to execute the project.
How does the project pipeline look for Jubilee Metals and what can investors expect moving forward?
We already own the platinum at PlatCro and we are currently concluding the process route evaluation. We expect to make a decision on the processing route during Q2 of 2018.
We have announced our decision to build a dedicated PGM plant for the Dilokong project and have submitted our process designed to the regulatory body. We await approval to commence construction.
Our process review and developments for the Kabwe project has delivered exceptional results. The Jubilee team can reduce the capital, increase the production and shorten the pipeline to construct the plant. We are in active discussions to potentially expand our project pipeline to include copper and cobalt in the short term.
If you would like more information on Shard Capital, or Jubilee Metals Group, please contact us.
Shard Capital is the appointed Broker for Jubilee Metals Group.
Contacts: Damon Heath/Erik Woolgar
Tel +44 (0) 20 7 186 9900
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