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Exxaro Resources Limited

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Our opinion on the current state of EXXARO(EXX)Exxaro (EXX) is a BEE coal company with interests in iron and heavy minerals. It has operations in Australia, America, and Europe and is a provider of coal to Eskom's Medupi power station. The company has been working to increase coal production from 48 million tons to about 60 million tons by 2022, but this strategy might be reconsidered due to lower global demand for coal. Exxaro is a highly cash-generative operation that is usually profitable, depending on the price of coal. While demand for coal has been strong both locally and in the export market, the shift toward renewable energy is seen as a long-term threat to the business. The difficulty of obtaining funding for new coal-fired power stations is growing, as banks face pressure from environmental groups. On 9th April 2021, the company announced that it had sold its interest in Exxaro Coal Central (Pty) Ltd and the Leeuwpan Coal Mine operation. The Ukraine conflict initially had a beneficial impact on Exxaro due to rising commodity prices, but that effect has now disappeared. The company announced that, with lower coal prices, it was no longer viable to transport coal to port by truck, a measure it had been forced to take due to inefficiencies in South Africa’s rail and port systems. In its results for the year to 31st December 2024, the company reported revenue up 5% and headline earnings per share (HEPS) down 36%. The company said, "In line with our production guidance, overall coal production volumes, excluding buy-ins, reduced by 7% to 39.5Mt in FY24, from 42.3Mt in FY23. The decrease in production volumes was largely driven by lower Eskom demand at Grootegeluk mine. Belfast mine production improved by 21% to 3.5Mt in FY24 compared to 2.9Mt in FY23, after operating for the full year." Exxaro remains a commodity play. Technically, the share is volatile but has been in a volatile upward trend since November 2015. Within that, it has been moving sideways and downwards since April 2022.
JSE:EXX
by PDSnetSA
Our opinion on the current state of EXXARO(EXX)Exxaro (EXX) is a BEE coal company with interests in iron and heavy minerals. It has interests in Australia, America, and Europe. It is a provider of coal to Eskom's Medupi power station. The company is trying to improve coal production from 48 million tons presently to about 60 million tons by 2022, but this policy might be changed due to the lower demand for coal on the world market. This is an immensely cash-generative operation that is usually profitable depending on what happens to the price of coal. The demand for coal both locally and in the export market has been strong, but the shift towards renewable energy is seen as a long-term threat to the business. It is becoming increasingly difficult to obtain funding for new coal-fired power stations as banks feel the pressure from environmental groups. On 9th April 2021, the company announced that it had sold its interest in Exxaro Coal Central (Pty) Ltd and Leeuwpan Coal Mine operation. Obviously, the Ukraine conflict initially had a beneficial impact on this share through higher commodity prices, but that effect has now disappeared. The company announced that, with the lower price of coal, it was no longer viable to transport coal to port by truck—something it had been forced to do because of the inefficiency of the South African rail and port systems. In its results for the six months to 30th June 2024, the company reported revenue up 1% and headline earnings per share (HEPS) down 37%. Operationally, the company produced 19.3 million tons of coal and sold 18.9 million tons. Group revenue was static at about R19bn. The company said, "Group EBITDA decreased by 33% to R5 118 million (1H23: R7 660 million), mainly attributable to the 27% decrease in Coal EBITDA discussed in more detail under the coal business performance." Exxaro remains a volatile commodity play. Technically, the share is volatile but has been in a volatile upward trend since November 2015.
JSE:EXX
by PDSnetSA
Our opinion on the current state of EXXARO(EXX)Exxaro (EXX) is a BEE coal company with interests in iron and heavy minerals, with operations in Australia, America, and Europe. It is a major provider of coal to Eskom's Medupi power station. The company has been aiming to increase coal production from 48 million tons to about 60 million tons by 2022, though this policy might be adjusted due to the lower demand for coal on the world market. Despite the challenges, Exxaro is known for being a cash-generative operation, usually profitable depending on coal prices. While demand for coal has been strong both locally and in the export market, the global shift towards renewable energy poses a long-term threat to the business. It is becoming increasingly difficult for the company to secure funding for new coal-fired power stations, as banks are pressured by environmental groups. On 9th April 2021, Exxaro announced the sale of its interest in Exxaro Coal Central (Pty) Ltd and the Leeuwpan Coal Mine operation. In its results for the year to 31st December 2023, the company reported a 17% decrease in revenue and a 22% decline in headline earnings per share (HEPS). The company stated, "The revenue contribution from our energy operations was 16% higher than FY22. Energy generation from the Cennergi operating wind assets was higher, driven by improved wind conditions compared to the prior year. Group EBITDA decreased by 29% to R13 399 million (FY22: R19 001 million), mainly attributable to the 36% decrease in Coal EBITDA." The share has been on a downward trend since the beginning of 2023. The Ukraine conflict initially had a beneficial impact on Exxaro's share price through higher commodity prices, but that effect has since dissipated. The company announced that, with the lower price of coal, it was no longer viable to transport coal to port by truck—something it had been forced to do due to inefficiencies in the South African rail and port systems. Exxaro remains a volatile commodity play, with its share price currently in a downward trend but potentially bottoming out. In a pre-close update on 25th June 2024, the company stated, "Total coal production (including buy-ins) and sales volume for 1H24 are expected to decrease by 14% and 12% respectively, mainly due to the reduced demand from Eskom at Grootegeluk, based on their latest internal plan." In a trading statement for the six months to 30th June 2024, Exxaro estimated that HEPS would fall by between 31% and 45%, attributing this to lower sales prices and volumes amid ongoing logistical challenges and reduced offtake from Eskom, partially offset by a slightly weaker exchange rate at its coal business. Technically, the share has been volatile but has remained in an upward trend since November 2015.
JSE:EXX
by PDSnetSA
Our opinion on the current state of EXXARO(EXX)Exxaro (EXX) is a BEE coal company with interests in iron and heavy minerals. It has interests in Australia, America, and Europe. Exxaro is a provider of coal to Eskom's Medupi power station. The company initially aimed to increase coal production from 48 million tons to about 60 million tons by 2022, but this policy might be changed due to the lower demand for coal in the global market. The price of export coal has dropped from $100 per tonne at the end of 2018 to as low as $60 per tonne. This is an immensely cash-generative operation that is usually profitable, depending on coal prices. While demand for coal both locally and in the export market has been strong, the shift towards renewable energy poses a long-term threat to the business. It is becoming increasingly difficult to obtain funding for new coal-fired power stations as banks face pressure from environmental groups. On 9th April 2021, Exxaro announced that it had sold its interest in Exxaro Coal Central (Pty) Ltd and Leeuwpan Coal Mine operation. In its results for the year to 31st December 2023, the company reported revenue down 17% and headline earnings per share (HEPS) down 22%. The company said, "The revenue contribution from our energy operations was 16% higher than FY22. Energy generation from the Cennergi operating wind assets was higher, driven by improved wind conditions compared to the prior year. Group EBITDA decreased by 29% to R13 399 million (FY22: R19 001 million), mainly attributable to the 36% decrease in Coal EBITDA." The share has been moving down since the beginning of 2023. Initially, the Ukraine conflict had a beneficial impact on this share through higher commodity prices, but that effect has now disappeared. The company announced that, with the lower price of coal, it was no longer viable to transport coal to port by truck - something it had been forced to do because of the inefficiency of the South African rail and port systems. Exxaro remains a volatile commodity play, currently on a downward trend but possibly bottoming out. In a pre-close update on 25th June 2024, the company said, "Total coal production (including buy-ins) and sales volume for 1H24 are expected to decrease by 14% and 12% respectively, mainly due to the reduced demand from Eskom at Grootegeluk, based on their latest internal plan."
JSE:EXX
by PDSnetSA
Our opinion on the current state of EXXExxaro (EXX) is a BEE coal company with interests in iron and heavy minerals, operating in Australia, America, and Europe. It is a significant provider of coal to Eskom's Medupi power station. The company aims to increase coal production from 48 million tons presently to about 60 million tons by 2022, although this plan might be revised due to the lower demand for coal on the global market. The price of export coal has declined from $100 per tonne at the end of 2018 to as little as $60 per tonne. Despite fluctuations in coal prices, Exxaro is a cash-generative operation, usually profitable depending on coal price movements. However, the long-term viability of the coal business is challenged by the shift towards renewable energy. Obtaining funding for new coal-fired power stations has become increasingly difficult as banks face pressure from environmental groups. On 9th April 2021, the company announced the sale of its interest in Exxaro Coal Central (Pty) Ltd and Leeuwpan Coal Mine operation. In its results for the year to 31st December 2023, Exxaro reported a 17% decrease in revenue and a 22% decrease in headline earnings per share (HEPS). The company attributed the decline in EBITDA to a 36% decrease in Coal EBITDA, despite a 16% increase in revenue contribution from its energy operations. The share price of Exxaro has been declining since the beginning of 2023. While the Ukraine conflict initially boosted the share price due to higher commodity prices, this effect has since dissipated. The company announced that, due to the lower price of coal, it was no longer economically viable to transport coal to port by truck, highlighting challenges with the inefficiency of the South African rail and port systems. Exxaro remains a volatile commodity play, currently experiencing a downward trend, but there are indications it may be bottoming out. However, ongoing shifts in the energy landscape and global market dynamics continue to pose challenges to the company's long-term prospects.
JSE:EXX
by PDSnetSA
JSE Coal Miners Relative To JSE Top 40 IndexThe updated comment is in 'orange' on the chart. JSE Coal Miners. Previously I highlighted buy ideas on both EXX at R145 (high of R185) and TGA at R134 (high of R170) while also discussing the equally-weighted relative chart versus the Top 40 Index. This is an updated chart of JSE Coal Miners Relative To JSE Top 40 Index which is a printing it's first test of it's declining 200-day simple moving average (SMA). The combination of ultra short term/short term high bullish momentum/approaching overbought conditions could see a consolidation/minor retracement on a relative basis. For more research insights, including trade ideas, get in touch today.
JSE:EXX
by techpers
1
Exxaro showing a stronger buy signal to R226.76Initially, I wrote that we could expect a break to the downside where there'll be a better entry for a short. But the entry price never struck and the price turned up intot he channel. Price is now breaking above the down channel, indicating a chosen direction - Up. Other signs show some upside 7>21 RSI>50 - Bullish Target R226.76 WARNING I'm not too convinced yet and will need a stronger breakout and maybe even for the price to move up, test the support then bounce giving a conservative entry. Then we are talking.
JSE:EXXLong
by Timonrosso
Our opinion on the current state of EXX.Exxaro (EXX) is South Africa's BEE coal company with interests in iron and heavy minerals. It has interests in Australia, America and Europe. It is a provider of coal to Eskom's Medupi power station. The company is trying to improve coal production from 48m tons presently to about 60m tons by 2022, but this policy might be changed due to the lower demand for coal on the world market. The price of export coal has dropped from $100 per tonne at the end of 2018 to as little as $60 per tonne. This is an immensely cash-generative operation that is usually profitable depending on what happens to the price of coal. The demand for coal both locally and in the export market has been strong, but the shift towards renewable energy is seen as a long-term threat to the business. It is becoming increasingly difficult to obtain funding for new coal-fired power stations as banks feel the pressure from environmental groups. On 9th April 2021, the company announced that it had sold its interest in Exxaro Coal Central (Pty) Ltd and Leeuwpan Coal Mine operation. In its results for the year to 31st December 2022 the company reported revenue up 41% and headline earnings per share (HEPS) up 28%. The company said, "Headline earnings increased by 26% to R14 558 million (FY21: R11 568 million), driven mainly by the 78% increase in group EBITDA, which was partially offset by the 26% decrease in equity-accounted income. SIOC’s adjusted equity-accounted income was 46% lower as a result of lower iron ore prices and volumes as well as higher operating expenses, which were partly offset by a weaker currency" In a trading statement for the six months to 30th June 2023 the company estimated that HEPS would fall by between 23% and 37%. The company had been benefiting from rising commodity prices since 2016 and an upward sloping trendline has formed. This trendline was broken convincingly on 14-8-2019, but the upward trend resumed at the start of 2021 with the share moving to new cycle highs. The share has been moving down since the beginning of 2023. Obviously, the Ukraine conflict has had a beneficial impact on this share through higher commodity prices, but that effect is beginning to wane. It remains a volatile commodity play.
JSE:EXX
by PDSnetSA
2
"Exxaro's Rocky Road: Bearish Signals Emerge Amid M Formation"Exxaro's Rocky Road: Bearish Signals Emerge Amid M Formation Breakout, Price Target Set at R13000" Exxaro Resources Ltd 1. Price Formation: The price has broken out from an M price formation on a daily chart. 2. Moving Averages: The 7-day moving average (MA) is below the 21-day MA, which is a positive sign indicating short-term bullish momentum. 3. 200-day Moving Average is above the Price. 4. Thus, Mas 7<21<200 5. Relative Strength Index (RSI): The RSI is less than 50, indicating bearish momentum and potential further downward movement. 6. Price Target: R13000 Exxaro Resources Ltd – the company Exxaro Resources Ltd is a large coal and heavy minerals mining company based in South Africa. The company operates facilities and offices in Africa, Europe, Australia, and Asia. It was founded in 2006 as the result of a merger between Kumba Resources and Eyesizwe Coal. The company is the second-largest coal producer in South Africa and has interests in mineral sands operations and base metals. It is also involved in various initiatives to invest in renewable energy in South Africa. Exxaro is listed on the Johannesburg Stock Exchange (JSE), and its mining activities have played a significant role in the South African economy. However, like any company involved in the extractive industries, it is subject to fluctuations in commodity prices and market demand.
JSE:EXXShort
by Sahle
Exxaro (EXX): Now in Potential Reversal ZoneThe previous idea of Exxaro hit a stop-loss without reaching price objective, the share is now in a reversal zone depicted by the intersection of a falling wedge & a median line of a pitchfork. Ideally we would want to see a daily swing low, followed by a close above the daily 10DMA for a long position. Less risk accepting investors can opt to add closing above the resistance line of the falling wedge as a pre-condition. Target objective would initially be the upper line of the pitchfork & slightly above the pink sloping resistance. Stop-loss In bear market capital preservation is important, price going below the swing low in daily time frame would mean stepping aside & wait.
JSE:EXXLong
by runyamhere
$JSEEXX - Exxaro: Death Cross Triggers Bearish OutlookThe original analysis of Exxaro was on 23.03.2023 and I was already bearish, link below. Exxaro is notorious for wild swings so this could be a big bear especially with coal prices under severe pressure. I have overlaid the coal futures prices on the chart in gold Bearish triggers: 1-Support trendline decisively broken. 2-Death Cross, 50EMA crossed below 200EMA on daily chart and momentum is accelerating. 3-MACD below zero-line. The wild nature of swings in Exxaro's share price historically could see the price back to the post-pandemic lows in the 7000 region.
JSE:EXXShort
by Loyiso_BlaqueSoros_Mpeta
$JSEEXX - Exxaro: What Will The Trendline Break Trigger?Exxaro released a good set of FY2022 results on the 16th of March. Salient results: Revenue of R46.4 billion, up 41% from R32.8 billion Net operating profit of R16.2 billion, up 67% from R9.7 billion AEPS of 5 713 cents, up 11% from 5 128 cents HEPS of 6 016 cents, up 28% from 4 683 cents Final dividend of 1 136 cents per share, down 39 cents per share from 1 175 cents per share The share price has had a steady ascent from the March 2020 low of 7507 to peak at 23998. From the peak, the share traded generally sideways and the bears seem to be in control now. The FY2022 results did little to excite the bulls and the share price is now trading below a significant trendline. This is quite a slow moving and choppy share but in the short-term I will be looking for further downside while the share trades below 21000.
JSE:EXXShort
by Loyiso_BlaqueSoros_Mpeta