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S.Africa's Thungela shares jump after profit surges

08/15/2022 | 04:12am EST

(Reuters) -South Africa's Thungela Resources reported half-year profit more than 20 times that of the year before, buoyed by soaring coal prices, and said it would return 8.2 billion rand ($503 million) to shareholders, driving its shares over 6% up.

Coal prices have been driven to record highs by increased gas-to-coal switching especially after Russia, a major gas supplier to Europe, invaded Ukraine in February.

Thungela reported on Monday headline earnings per share (HEPS) - the main profit measure in South Africa - of 67.23 rand for the six months to June 30, up from 3.05 rand a year earlier.

The company, which was spun off from global mining giant Anglo American Plc in June 2021, said it would return 8.2 billion rand to shareholders after declaring a dividend of 60 rand per share.

Its shares were 6.38% up by 0745 GMT.

The coal exporter however said it could not fully take advantage of the elevated prices as it had to curtail production due to the state-owned rail utility Transnet's limited capacity to haul the mineral to ports.

As a result of the rail woes, Thungela has revised its production guidance for 2022 to between 13 and 13.6 million tonnes, from the previous 14-15 million range. The company is exploring the possibility of using trucks to haul coal to port.

Thungela expects its full-year unit costs to be higher than previously expected, partly due to lower production. It now expects unit costs to be between 885-915 rand, from the previous forecast of 850-870 rand.

($1 = 16.2954 rand)

(Reporting by Nelson Banya; editing by Jason Neely and Emelia Sithole-Matarise)


ę Reuters 2022
Stocks mentioned in the article
ChangeLast1st jan.
ANGLO AMERICAN PLC -0.80% 3176.5 Delayed Quote.6.23%
DOW JONES AFRICA TITANS 50 INDEX -0.13% 465.07 Real-time Quote.-13.16%
S&P AFRICA 40 INDEX -0.12% 153.32 Real-time Quote.-12.28%
THUNGELA RESOURCES LIMITED 4.20% 287 End-of-day quote.239.48%
US DOLLAR / RUSSIAN ROUBLE (USD/RUB) -0.60% 60.2847 Delayed Quote.-19.07%
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