Our opinion on the current state of JUBILEE(JBL)
Jubilee Metals Group (JBL) is a diversified metals recovery company that specializes in reprocessing mine waste and surface materials. It is listed on both the London AIM market and the JSE's Alt-X. The company operates in South Africa, the UK, Madagascar, and Australia, and is involved in a joint venture in Zambia to produce lead, zinc, and vanadium. Jubilee primarily produces platinum group metals (PGM) and chrome, with its main asset being a 63% stake in the Tjate project, which contains the world’s largest undeveloped block of platinum ore, estimated at 65 million ounces, located on the Western limb of the Bushveld Igneous Complex.
In recent years, Jubilee has shifted its focus toward a smelting and beneficiation strategy as a cashflow survival measure. The company is currently investing about R154 million to consolidate its PGM retreatment business by acquiring a reprocessing plant and several dumps. This investment includes the purchase of a chrome processing operation and 1.8 million tons of tailings from PlatCro Minerals. While Jubilee is a low-cost producer, it remains exposed to the fluctuations in the platinum and base metals markets.
For the year ending 30th June 2024, Jubilee reported a 20.2% increase in revenue and a 20% rise in chrome concentrate production. However, 6E PGM production decreased by 14.2%, while copper production increased by 17.1%. Group EBITDA declined by 7.1% to US$27.7 million, down from US$29.8 million in FY2023, primarily due to the sharp decline in PGM EBITDA, although this was partially offset by increased chrome production.
In our view, Jubilee Metals Group is one of the better options within the mining sector, but it remains highly volatile and carries significant risk. We recommend waiting for a break above the share's long-term downward trendline before considering an investment.
In recent years, Jubilee has shifted its focus toward a smelting and beneficiation strategy as a cashflow survival measure. The company is currently investing about R154 million to consolidate its PGM retreatment business by acquiring a reprocessing plant and several dumps. This investment includes the purchase of a chrome processing operation and 1.8 million tons of tailings from PlatCro Minerals. While Jubilee is a low-cost producer, it remains exposed to the fluctuations in the platinum and base metals markets.
For the year ending 30th June 2024, Jubilee reported a 20.2% increase in revenue and a 20% rise in chrome concentrate production. However, 6E PGM production decreased by 14.2%, while copper production increased by 17.1%. Group EBITDA declined by 7.1% to US$27.7 million, down from US$29.8 million in FY2023, primarily due to the sharp decline in PGM EBITDA, although this was partially offset by increased chrome production.
In our view, Jubilee Metals Group is one of the better options within the mining sector, but it remains highly volatile and carries significant risk. We recommend waiting for a break above the share's long-term downward trendline before considering an investment.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.