Edison Investment Research - Sylvania Platinum (SLP) Sylvania Platinum - New Thaba JV adds significant value

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Edison Investment Research

Alison Turner

Sylvania Platinum - New Thaba JV adds significant value

Sylvania Platinum (SLP) has announced a 50:50 joint venture (JV) with Limberg Mining Company (LMC), called Thaba, to process platinum group metals (PGM) and chrome ores from LMC’s historical tailings dumps and run-of-mine (ROM) ore. It is expected to start production in H225 and will for the first time see Sylvania receiving a chromite concentrate revenue stream on its own account. Sylvania is investing US$32m in capital expenditure and US$5m in working capital from its large cash resources (of which 50% is a loan to LMC to be paid back from JV cash flow after production commences) in exchange for c 6,500koz of forecast PGM and 200kt of chrome concentrate production pa over 10 years. We value Sylvania’s 50% share of the JV at 17.2p/share, resulting in a 29.5% increase in our total valuation to 135.4p/share.

29/08/2023 1 EN

Underlying

Sylvania Platinum

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BMG864081044 London Stock Exchange Bermuda

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Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Alison Turner

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Sylvania Platinum - New Thaba JV adds significant value

Sylvania Platinum - Healthy production recovery

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