Our opinion on the current state of JBL

Jubilee Metals Group (JBL) is a diversified metals recovery company which re-processes mine waste and surface materials. It is listed both on the London AIM market and on the JSE's Alt-X. It has operations in South Africa, the UK, Madagascar, and Australia - and it is involved in a joint venture in Zambia to produce lead, zinc and vanadium. The company primarily produces platinum group metals (PGM) and chrome, and its primary asset is a 63% stake in the Tjate project, which is assessed to include the world's largest undeveloped block of platinum ore with an estimated potential of 65m ounces on the Western limb of the Bushveld Igneous Complex. However, in recent years the company has "...pivoted towards a smelting and beneficiation strategy as a cashflow survival strategy."

Jubilee is currently spending about R154m to consolidate its PGM retreatment business by buying a reprocessing plant and some dumps. The R154m is being used to buy a chrome processing operation and 1,8m tons of tailings from PlatCro Minerals. It is a low-cost producer, but subject to the vagaries of the platinum and base metals markets. In its results for the six months to 31st December 2023, the company reported revenue up 18,4% with PGM production up 11,2% and chrome production up 7,4%. The company said, "Zambian copper operations continue to show strong growth, driven by the investment in the expansion projects with an expected further sharp increase on completion of the upgrade to the Roan copper concentrator."

In our view, this share is probably one of the better options in the mining sector but remains highly volatile and risky. On 12th December 2023, the company announced that it had secured one of the largest dumps of copper waste on the surface in Zambia. This caused the share price to jump 19%. We suggest waiting for a break up through the share's long-term downward trendline before investigating further.