Thungela Resources (TGA) H2 2023 earnings summary

Executive summary

• FY2023 profit was R5.0bn, adjusted EBITDA R8.5bn and adjusted operating free cash flow R6.8bn, all lower than 2022 amid weaker coal prices.

• Export saleable production was 13.1Mt, including Ensham; export equity sales rose to 12.8Mt from 12.2Mt.

• Year-end net cash was R10.2bn; shareholder returns totaled R3.3bn through dividends and a share buyback.

Financial highlights

• Profit for the period fell to R5.0bn from R18.2bn; EPS declined to R37.66 from R127.08.

• Adjusted EBITDA was R8.5bn versus R29.5bn; adjusted operating free cash flow was R6.8bn versus R18.1bn.

• South African FOB cost excluding royalties increased to R1,084/t from R929/t; inflation on operating costs was 9.6%.

• Adjusted EBITDA included R738m from Ensham; earnings declined mainly due to lower benchmark coal prices, partly offset by weaker exchange rates and lower royalties.

Outlook and guidance

• South African 2024 export saleable production guidance is 11.5–12.5Mt; FOB costs are R1,180–1,300/t including royalties and R1,170–1,290/t excluding royalties.

• South African 2024 sustaining capex is R900m–R1.1bn; expansionary capex is R1.6bn–R1.9bn.

• Ensham 2024 export saleable production guidance is 3.2–3.5Mt on a 100% basis; FOB cost guidance is AU$150–160/t including royalties and AU$130–140/t excluding royalties.

• Ensham sustaining capex guidance is AU$40m–AU$70m; expansionary capex is nil.