Thungela Resources Limited

For the first half of 2026, revenue increased modestly to ZAR 15.2 billion, adjusted EBITDA rose 91% to ZAR 1.3 billion, net profit increased to ZAR 1.4 billion, and EPS increased 467% to ZAR 10.95. Headline EPS was ZAR 4.80 per share, excluding the approximately ZAR 1 billion noncash profit on the Kleinkopje mining-right disposal. Group export saleable production increased 6% to 8.5 million tonnes and export equity sales increased 7% to 8.9 million tonnes; net cash was ZAR 6.1 billion. The board declared an interim dividend of ZAR 5.50 per share, equal to ZAR 773 million, and the company also noted ZAR 705 million of sustaining capex and ZAR 104 million of expansionary capex. For the second half, management said South African production is expected to be stronger, FOB cost guidance remains intact, Ensham production is trending above the range but is still expected to finish within guidance, and Ensham sustaining capital is expected to be within ZAR 500 million to ZAR 700 million.

Moses Madondo framed the half-year as proof of Thungela’s resilience and the benefit of disciplined execution, saying the business has now created and returned value over five years as a listed company. He emphasized safety, operational improvement, portfolio optimization and capital discipline, highlighting 3.5 years fatality-free, improved recordable case frequency, stronger export sales and robust cash generation. His tone was confident but measured, with repeated comments that the company is focused on the ‘business of today’ while building optionality for the future.

Deon Smith focused on the financial bridge: adjusted EBITDA up 91% to ZAR 1.3 billion, net profit of ZAR 1.4 billion, revenue of ZAR 15.2 billion, and adjusted operating free cash flow of ZAR 1.9 billion, including ZAR 1.1 billion of realized FX gains. He said the balance sheet remained strong with ZAR 6.1 billion in net cash and ZAR 3.2 billion of undrawn facilities, and that the interim dividend of ZAR 5.50 per share represented about 41% of adjusted operating free cash flow. On margins and cost, he cited South Africa EBITDA margin of around 6% and Ensham around 16%, South African FOB costs of ZAR 1,374 per tonne versus ZAR 1,264 last year, and Ensham FOB costs of ZAR 1,466 per tonne versus ZAR 1,904. He also gave FX hedging detail, noting about $390 million of H2 2026 FX at just below ZAR 18, about $120 million in 2027 at ZAR 18, and about $60 million in 1H28 at roughly ZAR 18.53.

Analysts pressed on the lower depreciation charge, and Deon said the key reason was the prior impairment, which reset the PPE base; he suggested the current depreciation run-rate is likely a good proxy going forward unless PPE changes materially. On dividends, he said the board is balancing returns with market volatility and future flexibility; the ZAR 5.50 payout was above the minimum 30% policy and reflects a preference to preserve a resilient balance sheet and optionality for growth. Questions on Australia realized pricing and coal-market outlook drew a cautious but constructive answer: management said fixed-price contracts lagged the rally, discounts should narrow somewhat, and they remain ‘coal bulls’ medium to long term, but are not overly aggressive because of domestic supply growth in China and India and mixed near-term signals. Zibulo, rehab funding and working capital were also discussed; management expects Zibulo to improve in H2 as the North Shaft transition continues, and said rehab/green-fund dynamics may reach an inflection in early 2027.