Tharisa’s first-half results were ahead of Peel Hunt’s expectations with underlying profits (EBITDA) of US$111mln against the broker's US$108mln estimate.
Lower site cash costs offset lower-than-expected revenues at the South African platinum and chrome miner, said the broker.
The interim dividend of USc3 equated to a 19% payout of first-half headline earnings, which is the same ratio as 2021, it noted.
“We are heartened that while revenues were lower than expected (partly on lower volumes, partly on realised prices), this was more than offset by reduced cash costs.
“This came despite a tick up in the stripping ratio HoH, meaning that cost pressures were more contained than we anticipated.
“While cost inflation is very real at present this does mean that the inflation of the next 6-12 months starts from a lower base."
Peel Hunt also noted that management reiterated guidance and expects that the Vulcan project should deliver its first full quarter in the September quarter of this year.
The Zimbabwe team expect Selene Chrome to reach capacity at roughly the same time.
'Buy' with a target price of 255p said the broker.