Tharisa PLC (LON:THS) chief executive Phoevos Pouroulis described a “solid operational performance” as the company reported on the three months ended 31 December 2019.
The Cypriot firm with mining assets in South Africa, in a statement, told investors that it mined 1,143 tonnes of ore and milled 1,247 tonnes during the quarter.
Platinum Group Metals (PGM) recovery was marked at 82.2%, with the company producing 34,400 ounces in the period, while the chrome recovery rate was 63.1% with some 342.5 tonnes produced.
It noted that output was negatively impacted by unprecedented inclement weather and electricity load shedding by national utility Eskom.
READ: Tharisa focuses on Vision 2020 ambitions after challenging year
"A solid operational performance from mining and processing lead to a stable quarter despite the adverse impact of weather, and the well-publicised Eskom power shortages,” Pouroulis said.
He added: “Mining, accounting for the weather-related impact, was in line with expectations and we should see a build-up towards the latter half of the year.
“Our co-product model remains robust as record PGM prices were received.
“However, we remain concerned about the prevailing low chrome and ferrochrome prices, which has had a negative effect on the chrome industry.
“Our progress in Zimbabwe is continuing as planned."
Broker says positive quarter could "drive outperformance"
Peter Mallin-Jones, analyst at stockbroker Peel Hunt, reacted positively to Friday’s update.
In a note, he said: “The December quarter saw the plant deliver improved chrome recoveries and yields despite the Eskom and weather interruptions, events that affected the PGM circuit to a greater degree.
“The stripping ratio pushed over the life-of-mine average, and with the fleet additions it looks set to push towards the 5.6Mtpa run-rate to reach the Vision 2020 targets roughly 12 months ahead of our expectations.
“This could drive outperformance relative to our FY20 estimates, creating a positive tailwind into the Vulcan plant delivery late this year.”