A DECLINE in grade hampered platinum group metal recoveries in a traditionally hazardous second quarter for Tharisa. However, an $800 per ounce gain in average pgm prices helped the group to higher cash by period-end.
As a result, Tharisa ended the quarter with $54.7m in net cash compared to $47m at the close of the second quarter. The pgm and chrome miner, which operates the Tharisa Mine in North West province, has a September 30 year-end.
Heavy rains flooded Tharisa Mine in the second quarter last year, which led to a downgrade in the firm’s production guidance. There were “increased lightning events” and higher rainfall in the period under review.
The improvement in cash is reflective of a stronger market for Tharisa’s pgms and chrome, the latter trading on average at $290 per ton (Q1: $276/t). The chrome is currently trading at $315/t owing to freight and oil price cost escalation stemming from the conflict in the Middle East, the group said.
The conflict also resulted in liquidation of some pgm holdings, but in general the metals have been robust so far. At a $3,038/oz average basket price in the quarter, pgms are in a stable bull phase amid inventory depletion among carmakers. Demand will have to be met directly with supply, said Phoevos Pouroulis, CEO of Tharisa.
“Prices held firm even during the disruptive geopolitical second half of the quarter,” he said in commentary to the quarter numbers. “Chrome prices remain strong with logistics costs being passed on to the end customer.”
The higher oil price and possible scarcity are a running risk for South African miners, especially operating open-pit mines. Said Pouroulis: “In light of the current geopolitical challenges, we have put in place mitigation measures to ensure … security of fuel supply to the Tharisa Mine, while costs will increase, our focus remains on efficiency.”
During the second quarter, Tharisa began work on its transition to underground mining expected to absorb $500m in capital and operating expenses over the next 10 years. The group is also hopeful of concluding an agreement with Zimbabwe on fiscal regulations for its $545m Karo Platinum project.
Pouroulis said he was hopeful of soon concluding a deal with Zimbabwe. The group expressed similar hopes for a first quarter deal at the end of last year. Once finalised, there is $300m in additional finance to fully fund Karo.
On the operating front, pgm production was 34,300 ounces in the second quarter (Q1: 38,800 oz), while chrome production was higher at 404,000 tons (Q1: 349,000t). Tharisa’s processing facilities performed well despite the lower reef recoveries.
Full year production is forecast to be between 145,000 and 165,000 oz in pgms (6E) and between 1.50 and 1.65 million tons of chrome concentrate.
Shares in the company edged up just over one percent in early morning Johannesburg trade but are down a shade (-2%) so far this year. The stock doubled in value in 2025. René Hochreiter, an analyst for Noah Capital, said Tharisa was a stand-out buying opportunity.
“Anywhere else in the world Tharisa would have far higher ratings than currently given it by the market because of its critical minerals-rich orebody, steady production and its future production profile,” he said in a note.
“Chromite prices are steady and are rising and should see new all-time highs … and there are deficits in all the pgms, which are likely to see pgm prices at new record levels in 2026 and beyond,” he said. “The counter remains at the top of our rankings of mining shares.”
