Thungela Resources (TGA) H2 2024 earnings summary

Executive summary

• Achieved strong operational and financial performance in 2024, with significant improvements in safety and productivity across both South African and Australian operations, maintaining a fatality-free record for over two years.

• Export saleable production rose to 17.7 million tons, up from 13.2 million tons year-over-year, exceeding guidance, with notable gains at Ensham and South African mines.

• Net profit declined to ZAR 3.5 billion from ZAR 5.0 billion, with Ensham contributing ZAR 676 million.

• Advanced strategic priorities, including full ownership of Ensham, sale of Rietvlei Coal Mine stake, and establishment of a Dubai-based marketing office.

• Total shareholder returns included ZAR 13 per share in dividends and ZAR 460 million in share buybacks.

Financial highlights

• Adjusted EBITDA reached ZAR 6.3 billion, down from ZAR 8.5 billion year-over-year; margin compressed to 18% from 28%.

• Earnings per share were ZAR 26.76, benefiting from share buybacks, but down from ZAR 37.66.

• Generated adjusted operating free cash flow of ZAR 3.6 billion; ended year with net cash of ZAR 8.7 billion.

• Revenue impacted by lower realised coal prices; South Africa prices down 12%, Australia down 20%.

• Declared total dividends of ZAR 13 per share (ZAR 2 interim, ZAR 11 final) and share buybacks totaling up to ZAR 460 million.

Outlook and guidance

• 2025 export saleable production guidance: South Africa 12.8–13.6 million tons, Ensham 3.7–4.1 million tons, contingent on continued rail improvements.

• South Africa FOB cost per ton expected at ZAR 1,220–1,300 (including royalties); Ensham ZAR 1,650–1,780 per ton.

• Sustaining capex for South Africa ZAR 1.4–1.7 billion; expansionary capex ZAR 1.1–1.2 billion; Ensham sustaining capex ZAR 700–950 million.

• ZAR 400 million allocated for the Lephalale Coal Bed Methane demonstration plant in 2025.