Not surprisingly, the decline in chromium prices, combined with a contraction in production, weighed on the annual results of the Tharisa mine, which operates in South Africa and Zimbabwe.
The company, which specializes in the production of chromium and platinum, announced on Thursday, November 28, significantly lower results for the year ending September 30, 2019, both because of the drop in chromium prices (-13% over the period, to $162 per tonne) and a reorganization of its mining sites, which had an impact on production. As a result, year-over-year, revenues fell 16% to $342.9 million, while operating income fell 66% to $24.2 million. Barely known, the announcement immediately drove the 7% share price down on the Johannesburg Stock Exchange, where the company is listed. In its press release, the mining operator’s management also pointed out that in South Africa « the precarious situation in which the public electricity supplier Eskom finds itself, hinders its activity […] ». In fact, uncertainty about the supply of energy has led the company to invest in generators in order to have additional back-up capacity.
Despite these adverse factors, however, the group’s management was cautiously optimistic about its prospects. In particular, Tharisa announced that the restructuring of its flagship Tharisa mine, located 95 km northwest of Johannesburg, was on track. A reorganization that, once completed, will lead to substantial economies of scale and increased production, according to the company’s CEO, Phoevos Pouroulis. Finally, another project could also soon boost the company’s activity: the resumption, since June, of the Karo Mining mining project in Zimbabwe. The mine, which will require an investment of several billion dollars, could eventually become the largest platinum production site in the country.