Latest news with #JubileeMetalsGroup
Yahoo
12 hours ago
- Business
- Yahoo
Is There An Opportunity With Jubilee Metals Group PLC's (LON:JLP) 44% Undervaluation?
The projected fair value for Jubilee Metals Group is UK£0.065 based on 2 Stage Free Cash Flow to Equity Jubilee Metals Group's UK£0.037 share price signals that it might be 44% undervalued Our fair value estimate is 22% lower than Jubilee Metals Group's analyst price target of US$0.084 Today we will run through one way of estimating the intrinsic value of Jubilee Metals Group PLC (LON:JLP) by taking the expected future cash flows and discounting them to their present value. This will be done using the Discounted Cash Flow (DCF) model. Before you think you won't be able to understand it, just read on! It's actually much less complex than you'd imagine. Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in the Simply Wall St analysis model. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. In the first stage we need to estimate the cash flows to the business over the next ten years. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, and so the sum of these future cash flows is then discounted to today's value: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF ($, Millions) -US$19.2m US$21.7m US$20.0m US$19.2m US$18.7m US$18.5m US$18.6m US$18.7m US$19.0m US$19.3m Growth Rate Estimate Source Analyst x2 Analyst x2 Analyst x1 Est @ -4.41% Est @ -2.33% Est @ -0.87% Est @ 0.16% Est @ 0.87% Est @ 1.37% Est @ 1.72% Present Value ($, Millions) Discounted @ 7.8% -US$17.8 US$18.7 US$16.0 US$14.2 US$12.8 US$11.8 US$11.0 US$10.3 US$9.7 US$9.1 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = US$96m We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 5-year average of the 10-year government bond yield of 2.5%. We discount the terminal cash flows to today's value at a cost of equity of 7.8%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = US$19m× (1 + 2.5%) ÷ (7.8%– 2.5%) = US$376m Present Value of Terminal Value (PVTV)= TV / (1 + r)10= US$376m÷ ( 1 + 7.8%)10= US$177m The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is US$273m. In the final step we divide the equity value by the number of shares outstanding. Compared to the current share price of UK£0.04, the company appears quite undervalued at a 44% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent. Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Jubilee Metals Group as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 7.8%, which is based on a levered beta of 1.028. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Check out our latest analysis for Jubilee Metals Group Strength Debt is well covered by cash flow. Weakness Earnings declined over the past year. Interest payments on debt are not well covered. Opportunity Annual earnings are forecast to grow faster than the British market. Good value based on P/E ratio and estimated fair value. Threat Revenue is forecast to grow slower than 20% per year. Valuation is only one side of the coin in terms of building your investment thesis, and it is only one of many factors that you need to assess for a company. DCF models are not the be-all and end-all of investment valuation. Instead the best use for a DCF model is to test certain assumptions and theories to see if they would lead to the company being undervalued or overvalued. For instance, if the terminal value growth rate is adjusted slightly, it can dramatically alter the overall result. What is the reason for the share price sitting below the intrinsic value? For Jubilee Metals Group, we've put together three further factors you should consider: Risks: To that end, you should be aware of the 2 warning signs we've spotted with Jubilee Metals Group . Future Earnings: How does JLP's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other Solid Businesses: Low debt, high returns on equity and good past performance are fundamental to a strong business. Why not explore our interactive list of stocks with solid business fundamentals to see if there are other companies you may not have considered! PS. Simply Wall St updates its DCF calculation for every British stock every day, so if you want to find the intrinsic value of any other stock just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
IOL News
28-05-2025
- Business
- IOL News
Jubilee Metals advances Zambian sopper strategy with successful Roan trials
Jubilee Metals Group, a diversified metals producer with operations in South Africa and Zambia, on Wednesday said it has successfully completed extensive processing trials at its Roan Concentrator, securing a long-term feedstock supply agreement that commenced production this week. party run-of-mine (ROM) purchases. Jubilee Metals Group, a diversified metals producer with operations in South Africa and Zambia, on Wednesday said it has successfully completed extensive processing trials at its Roan Concentrator, securing a long-term feedstock supply agreement that commenced production this week. This milestone strengthens Jubilee's copper production profile and supports its ambition to capitalize on rising copper prices. The Roan trials demonstrated Jubilee's ability to process high-grade shallow transitional copper reefs, previously considered waste or too complex by other operators. Achieving copper yields of approximately 65% and a minimum grade of 1.4% Cu, the trials confirm Roan's capacity to handle 35 000 to 40 000 tonnes per month (tpm) of run-of-mine (ROM) material, producing 240 to 360 tpm of copper units. These results bolster confidence in Jubilee's Large Waste Project, which holds an estimated 260 million tonnes of similar transitional copper ore at surface. At its Munkoyo mining operations, Jubilee is maintaining a mining rate of 80 000 tpm, with 3 500 tpm of high-grade ROM (exceeding 2.5% Cu) delivered to the Sable Refinery, equivalent to 88 tpm of copper units. The company aims to increase this to 4 500 tpm (112 tpm copper units) by June 2025 and 8 500 tpm (212 tpm copper units) by October 2025. Lower-grade material (0.7% Cu) is stockpiled for future processing, with pilot trials underway for two 30,000 tpm modular processing units targeting 350 tpm of copper units by Q1 2026. Jubilee is also advancing Project G, with resource drilling set for June 2025 to support an open-pit expansion. The company has secured exclusive due diligence rights for two additional near-surface mining properties, reinforcing its growth strategy. Additionally, Jubilee completed a $12.3 million (R220m) sale of a non-core waste asset, payable over 20 months, and initiated a $6.75m trade of 10 million tonnes from its Large Waste Project, with initial payments received. CEO Leon Coetzer said, 'Our focus on transitional copper reefs, available in vast quantities, positions us to benefit from appreciating copper prices. The Roan trials have validated our processing capabilities, and with secure power and supply agreements, we are poised for stable growth.' The Sable Refinery expansion, delayed to prioritise mining and trials, is scheduled for completion in quarter one 2026, increasing capacity to 14 000 tonnes per annum to accommodate production from Munkoyo, Project G, and other opportunities. Combined high-grade ROM from Roan and Munkoyo is expected to yield 288 tpm of copper units by June 2025, rising to 400 tpm by August and potentially 500-550 tpm by October. Jubilee also announced the issuance of 5.96 million new shares to former chairperson Colin Bird to settle a £200 000 (R4.8 million) performance incentive, with shares locked for 12 months. The shares will be admitted to trading on AIM and JSE's Altx on or around June 3, 2025, increasing total issued capital to 3.07 billion shares. Jubilee has also entered into negotiations with various parties to potentially invest into the construction of the targeted modular processing units for the Large Waste Project. "The targeted companies offer more attractive investment terms under a partnership agreement approach than offered previously by the Abu Dhabi-based invest firm, which is preferred by Jubilee and is also non-dilutive for shareholders. Discussions over funding for processing plants on site at the Company's mining projects, also extend to the Large Waste Project," it said. The share price was up 1.01% at R1 at midday on the JSE on Wednesday. BUSINESS REPORT
Yahoo
25-05-2025
- Business
- Yahoo
Jubilee Metals Group (LON:JLP) Could Be Struggling To Allocate Capital
Did you know there are some financial metrics that can provide clues of a potential multi-bagger? Ideally, a business will show two trends; firstly a growing return on capital employed (ROCE) and secondly, an increasing amount of capital employed. Ultimately, this demonstrates that it's a business that is reinvesting profits at increasing rates of return. In light of that, when we looked at Jubilee Metals Group (LON:JLP) and its ROCE trend, we weren't exactly thrilled. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. For those who don't know, ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. Analysts use this formula to calculate it for Jubilee Metals Group: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.047 = US$12m ÷ (US$427m - US$162m) (Based on the trailing twelve months to December 2024). Therefore, Jubilee Metals Group has an ROCE of 4.7%. In absolute terms, that's a low return and it also under-performs the Metals and Mining industry average of 7.0%. See our latest analysis for Jubilee Metals Group Above you can see how the current ROCE for Jubilee Metals Group compares to its prior returns on capital, but there's only so much you can tell from the past. If you'd like, you can check out the forecasts from the analysts covering Jubilee Metals Group for free. In terms of Jubilee Metals Group's historical ROCE movements, the trend isn't fantastic. Around five years ago the returns on capital were 8.8%, but since then they've fallen to 4.7%. Although, given both revenue and the amount of assets employed in the business have increased, it could suggest the company is investing in growth, and the extra capital has led to a short-term reduction in ROCE. And if the increased capital generates additional returns, the business, and thus shareholders, will benefit in the long run. On a side note, Jubilee Metals Group's current liabilities have increased over the last five years to 38% of total assets, effectively distorting the ROCE to some degree. If current liabilities hadn't increased as much as they did, the ROCE could actually be even lower. While the ratio isn't currently too high, it's worth keeping an eye on this because if it gets particularly high, the business could then face some new elements of risk. Even though returns on capital have fallen in the short term, we find it promising that revenue and capital employed have both increased for Jubilee Metals Group. These trends are starting to be recognized by investors since the stock has delivered a 32% gain to shareholders who've held over the last five years. So this stock may still be an appealing investment opportunity, if other fundamentals prove to be sound. If you want to continue researching Jubilee Metals Group, you might be interested to know about the 1 warning sign that our analysis has discovered. While Jubilee Metals Group isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Zawya
05-03-2025
- Health
- Zawya
Zambia: Mining in Toxic Lead Waste Poisons Children
In the Zambian city of Kabwe, children suffer severe health effects due to lead poisoning because of extreme pollution from the toxic lead waste of a former mine. Zambia's government is facilitating new hazardous lead and zinc mining and processing of the toxic waste, posing major additional health risks to children. The Zambian government should suspend operations, revoke licenses of companies involved in the hazardous activities, and embark on a full clean-up of Kabwe's lead waste. Zambia 's government is facilitating hazardous mining and processing of toxic lead waste in the city of Kabwe that poses major health risks to children, Human Rights Watch said in a report released today. These business activities add to the harm faced by Kabwe residents, who have been exposed to toxic lead for decades from a former lead and zinc mine. The 67-page report, ' Poisonous Profit: Lead Waste Mining and Children's Right to a Healthy Environment in Kabwe, Zambia,' documents the Zambian government's issuance of mining and processing licenses for South African, Chinese, and local businesses and its failure to intervene against blatant violations of Zambian environmental and mining law by several mining and processing companies. 'The Zambian government should be protecting people from highly hazardous activities, not enabling them,' said Juliane Kippenberg, associate children's rights director at Human Rights Watch. 'Companies are profiting in Kabwe from mining, removing, and processing lead waste at the expense of children's health.' Human Rights Watch interviewed miners and community members in Kabwe and carried out open-source research and geospatial analysis. Human Rights Watch wrote to the government and 16 companies requesting information and received responses from the Ministry of Green Economy and Environment, the South African company Jubilee Metals Group, and a local businessman. Lead is a highly toxic metal and is particularly harmful to children. It can result in coma and death, as well as intellectual disability and ill-health. During pregnancy, it can result in miscarriage and other complications. Researchers estimate that over 95 percent of children living near the former mine in Kabwe have elevated blood lead levels, and about half of them urgently require medical treatment. Businesses have conducted or facilitated hazardous mining and processing to extract zinc, lead, or other minerals in lead-contaminated waste around Kabwe's former mine area between 2022 and late 2024. Companies have removed significant amounts of waste from the mine and placed open piles across Kabwe, putting the health of residents further at risk. 'The waste piles across Kabwe are very concerning,' said an 18-year-old activist. 'Number one, because children tend to play around them or on top of them. Also, those mountains of waste are taken to other places in Kabwe – they are not sealed off from the public, and this makes those areas toxic, too.' Small-scale and artisanal miners have mined lead, zinc, and other minerals on the concession of Jubilee Metals' subsidiary, Enviro Processing Limited (EPL), which has a mining license for much of the former Kabwe mine area. Miners said that security guards at the site had allowed them to enter, though Jubilee Metals denies this. Hazardous artisanal mining in lead waste has also taken place at a nearby area controlled by a local politician. Miners said that they sometimes sold mined material to the Chinese processing companies Datong Industries, Chengde Mining, and Superdeal Investments. In mid-2023, businesses and individuals began to remove large amounts of waste from the EPL concession by truck and to transport it to other parts of Kabwe. Several waste piles were placed outside the premises of processing companies. Satellite imagery analysis revealed that by January 2024, nine waste piles were visible. Several sources said that Kabwe Kamukuba Small Scale Mining Cooperative Society, a local cooperative involved in removing the waste in 2023, was connected to ruling party leaders who may have financially benefitted. The waste removal, which Jubilee Metals described as trespassing and theft, continued through 2024. Globally, zinc and lead are highly sought-after metals, including for the world's urgently needed fossil fuel phaseout and transition to renewable energy. The Zambian government has designated zinc and lead in Kabwe as 'critical minerals' needed for the global energy transition. The Zambian government has not done enough to enforce mining, environmental, and labor regulations, Human Rights Watch said. Under Zambian law, the government has the authority to sanction companies because of an 'unsafe working environment' or 'uncontrollable pollution.' The government, to Human Rights Watch's knowledge, has not taken such steps against businesses involved in the hazardous mining, removing, and processing of lead waste in Kabwe. The Zambia Environmental Management Agency has not published these businesses' environmental impact assessments, nor has it used its authority to suspend operations where they violate environmental law. Small-scale and artisanal miners eke out a living by digging for minerals in the waste piles. Several women miners told Human Rights Watch that they take their children to work because they need the income. One is a 32-year-old mother who took her son to work until he developed severe memory problems at age fifteen. She told Human Rights Watch: 'We are constantly living in fear because it is not a safe area … [but] it is the only way I can sustain my children.… I would love a different job.' Kabwe's mine was opened during the British colonial period and closed in 1994, leaving an estimated 6.4 million tons of uncovered lead waste dumps. Since then, lead has contaminated residential areas, exposing up to 200,000 people. In 2020, lawyers filed a class action lawsuit in a South African court against the mining company Anglo American for its alleged role—contested by the company—in the Kabwe mine from 1925 to 1974, seeking compensation, a lead-screening system for affected children and women, and remediation of the area. The court dismissed the case, but claimants have said they will appeal the decision. While the Zambian government has taken some measures to mitigate Kabwe's lead contamination through the World Bank-funded Zambia Mining and Environmental Remediation and Improvement Project, it has failed to clean up the source of contamination. The government has recognized the need for a broader cleanup but has seemingly done little to put words into action. President Hakainde Hichilema has twice—in March 2022 and April 2024 —announced the creation of a government committee to address the contamination, but no committee has been set up. The Zambian government should suspend operations and revoke licenses of companies involved in the hazardous mining, removal, and processing of lead-bearing waste in Kabwe, Human Rights Watch said. It should conduct a comprehensive program to provide a remedy for the former lead mine and its waste in close consultation with affected communities, civil society, and experts. To fund this effort, the Zambian government should seek technical and financial support from donor agencies and companies responsible for the pollution. 'The Zambian government should prioritize children's health over mining profit,' Kippenberg said. 'Only comprehensive remediation of the mine waste can protect children and future generations in Kabwe from toxic lead.' Distributed by APO Group on behalf of Human Rights Watch (HRW).
