Thungela Resources (TGA) H2 2024 earnings summary

Executive summary

• Achieved over two years (25 months) of fatality-free operations, with record low safety incidents in South Africa and significant improvement in Australia.

• Export saleable production rose to 17.7 million tons, up 34% year-over-year, exceeding guidance in both South Africa and Australia.

• Net profit declined to R3.5 billion from R5.0 billion, with R676 million contributed by Ensham (Australia).

• Completed the sale of Rietvlei Coal Mine and established Thungela Marketing International in Dubai to maximize coal value.

• Total shareholder returns included R13 per share in dividends and up to R601 million in share buybacks.

Financial highlights

• Revenue grew 16% to R35.6 billion; net profit was R3.5 billion, with profit attributable to equity shareholders at R3.6 billion.

• Adjusted EBITDA was R6.3 billion (margin 18%), earnings per share R26.76, and adjusted operating free cash flow R3.6 billion.

• Net cash at year-end was R8.7 billion, with a robust balance sheet and no significant external debt.

• Total capital expenditure was R3.4 billion, split between sustaining and expansionary projects.

• Final dividend of R11 per share declared, total dividend for the year R13 per share; total returned to shareholders (dividends + buybacks) was 64% of adjusted operating free cash flow.

Outlook and guidance

• 2025 export saleable production guidance: South Africa 12.8–13.6Mt, Ensham 3.7–4.1Mt.

• 2025 FOB cost per export tonne: South Africa R1,210–1,300 (including royalties); Ensham R1,470–1,780.

• Sustaining capex for 2025: South Africa R1.4–1.7bn, Ensham R700–950m; expansionary capex South Africa R1.1–1.2bn.

• R400 million to be spent on the Lephalale Coal Bed Methane Project demonstration plant in 2025.

• Board maintains a minimum 30% payout of adjusted operating free cash flow as dividend policy.