Tharisa PLC (LSE:THS, JSE:THA, OTC:TIHRF)’s annual production update was impressive for the drop through from the strong production and sales volumes to its cash line, according to analysts at Peel Hunt.
Net cash of US$79mln was well ahead of the broker’s US$27mln estimate and looking forward to the Karo development, building this level of cash in the business is a powerful signal, the analysts said.
Tharisa on track for 'strong set of financial numbers'
“Looking to the Tharisa operations, mining operations continue running well, with stripping remaining ahead of plan. This gives plenty of flexibility in managing the mine and plant through periods of constrained power supply, sustaining the operations," they added in a note to clients.
“Guidance for FY23E at 175-185koz PGM and 1.75-1.85Mt chrome concentrates compares to our 178koz PGMs and 1.88Mt chrome concentrates. We suspect that management has taken a conservative view of the ramp-up of the reconfigured Vulcan circuit from 2Q next year,” the analysts concluded.
The Peel Hunt analysts repeated a 'Buy' rating with a 245p target price for Tharisa shares