Our opinion on the current state of JBL

Jubilee Metals Group (JBL) is a diversified metals recovery company which re-processes mine waste and surface materials. It is listed both on the London AIM market and on the JSE's Alt-X. It has operations in South Africa, the UK, Madagascar, and Australia - and it is involved in a joint venture in Zambia to produce lead, zinc and vanadium. The company primarily produces platinum group metals (PGM) and chrome, and its primary asset is a 63% stake in the Tjate project, which is assessed to include the world's largest undeveloped block of platinum ore with an estimated potential of 65m ounces on the Western limb of the Bushveld Igneous Complex. Jubilee is currently spending about R154m to consolidate its PGM retreatment business by buying a reprocessing plant and some dumps. The R154m is being used to buy a chrome processing operation and 1,8m tons of tailings from PlatCro Minerals. In its results for the year to 30th June 2023 the company reported record production of PGMs, chrome and copper. Revenue was up 1% with higher chrome prices off-setting lower PGM prices. Headline earnings per share (HEPS) was 0,46 pence compared with 0,70 pence in the previous period. Technically, the share was in a strong upward trend because of rising PGM prices but has moved downwards since May 2021. On 3rd June 2021, the company announced that it had contracted to acquire additional PGM material which would enable it to process a further 16500 tons a month which would yield about 14500 ounces of PGM's per annum. It is a low-cost producer, but subject to the vagaries of the platinum and base metals markets. In our view, this share is probably one of the better options in the mining sector but remains highly volatile and risky.