Jupiter Mines (ASX: JMS) has reported an after-tax profit of $34 million for the six months to August 31, up 23 per cent on the prior corresponding period, following a strong performance at its part-owned Tshipi manganese mine in South Africa.
Jupiter directors declared a 1c unfranked interim dividend, payable on November 17.
Jupiter has a 49.9 per cent economic interest in Tshipi, in South Africa’s Kalahari region. Tshipi is a world-clas mine with a long life and low operating costs.
For the half-year period ended 31 August 2022, Tshipi recorded a net profit after tax of ZAR1.1 billion ($93.7 million) (HY2022: ZAR344 million; $31.5 million) and declared a total of ZAR550 million ($48.9 million) in dividends to its shareholders (HY2022: ZAR88 million; $8.0 million). Tshipi’s net profit was higher than the previous half due to a 2.4 per cent increase in sales tonnes and 10.8 per cent increase in average CIF price achieved.
Jupiter also used the half-year report to provide insights into global manganese market conditions.
Manganese ore prices fluctuated through the period and remained particularly resilient in the first quarter of FY2023 as high-grade oxide supply concerns supported prices and, to an extent, semi-carbonate prices leveraged off this. However, manganese ore prices started to decrease as the period progressed as supply concerns abated and weakened demand continued.
With weak demand from regions outside of China due to the effects of a decrease in crude steel production globally, increased manganese ore tonnage was and continues to be exported to China further affecting prices. This has led to a rise in manganese ore stocks at main Chinese ports. With the supply of high-grade material having improved, the price premium over semi-carbonate material has also reduced after historical highs.
Freight rates remained elevated at the beginning of the period particularly given the uncertainty of the conflict between Russia and Ukraine which led oil prices to rise. Since July 2022, manganese ore CIF prices have also decreased with the decrease in freight rates. Freight rates have reduced as a result of global economic factors impacting supply and demand fundamentals but also as costs decreased.