Press Releases

People-centric Thungela named Top Employer for second consecutive year

Thungela one of the largest pure-play producers and exporters of thermal coal in South Africa, has once again been recognised as a Top Employer in the country by the - Top Employers Institute, for the second year in a row. Last year, just eight months after its inception, the company was named an employer of choice in the mining sector.

“Acquiring Top Employer certification is a fantastic achievement and is also a further reaffirmation that we are living our values of safety, care and respect, accountability, excellence, agility and entrepreneurship in the work environment. This recognition will further enhance the employer brand of Thungela and will attest to the fact that we continue to uplift and improve people’s lives and create value for a shared future,” says Lesego Mataboge, the executive head of human resources at Thungela.

This year, Thungela once again achieved this prestigious certification, solidifying its commitment to its employees and was rated particularly highly for values, ethics and integrity not to mention our people strategy.

The Top Employers Institute is the global authority on recognising excellence in people practices and has certified 2 053 organisations in 121 countries/regions since 1991. The certification is given if the people and practices at the organisation can pass the HR Survey which is based on six key HR themes: steer, shape, attract, develop, engage, unite.

“As we grow, we continue to affirm our commitment to the individuals that make up our operation, and we are honoured that the Top Employers Institute can endorse our intention with this certification,” ends Mataboge.

This recognition once again confirms that Thungela is a people-centric business built on their people, for their people.

ENDS

For further information, please contact:
Tarryn Genis
tarryn.genis@thungela.com
082 324 4650

Thungela and Sasol this morning handed-over bulk wastewater infrastructure in Leandra in the Govan Mbeki Municipality.

As part of Isibonelo Colliery’s Social and Labour Plan, the mine constructed part of the bulk wastewater infrastructure to address the ailing infrastructure and sewage overflow challenges of this rapidly growing community. Wastewater infrastructure includes a network of sewer pipes that collect and carry household, business, and industrial effluent to wastewater treatment systems.

The project established a pipeline network which connects the community to the N17 pump station and replaced the rising main infrastructure – therefore upgrading the overall sewerage network. This project will benefit over 30 000 community members in Lebohang Leandra by improving sanitation and decreasing the negative impact on the environment.

Edrich Welthagen, general manager of Isibonelo Colliery, said:

“We are proud to be part of this partnership which supports the Municipality’s efforts and its ability to reduce waste being released in the environment and prevent diseases that can be caused by contaminants that are harmful to plants, animals, and humans.”

Victor Bester, senior vice president at Sasol said: “I urge the community to take good care of this upgraded infrastructure as well as all our other infrastructure systems that we have when disposing of solid waste. Also remember not to dispose any waste into the pipelines, drain systems, and in canals. It is important for all of us to ensure the continued protection of all water and sanitation infrastructure,” says Victor Bester.

Councillor Nhlakanipho Zuma, executive mayor of the Govan Mbeki Municipality, thanked the project partners, saying: “As the Govan Mbeki Municipality, we are very happy with the completion of this project which will address poor sanitation and restore the pride of our people. We thank Thungela and Sasol for their contribution in the development of the area and improving the lives of the residents.

This project will address the scourge of sanitation-related challenges to ensure that sewer spillages are eradicated in the area and we therefore urge community members to safeguard this critical infrastructure”

ENDS

For further information, please contact:
Wayne Mokhethi
wayne.mokhethi@thungela.com
073 894 7689

Highlights

• Zero work-related fatalities
• Three-fold increase in both adjusted EBITDA to R29.5 billion and net profit to R18.2 billion.
• Adjusted operating free cash flow increase to R18.1 billion from R3.9 billion.
• Net cash position of R14.7 billion (2021: R8.7 billion).
• Significant economic contribution to employees and communities.
• Declare final dividend of R40 per share, bringing total dividend for the year to R100 per share. This equates to 13.8 billion, or 76% of adjusted operating cash flow for the full year.

Thungela Resources Limited (“Thungela” or the “Company”) has delivered exceptional financial performance, solid operational delivery and continued to create value for stakeholders in 2022. The Company achieved a significant increase in adjusted EBITDA to R29.5 billion and in net profit to R18.2 billion, while executing its strategic priorities across several fronts.

We continue to prioritise being a fatality-free business and we operated without a fatality in 2022. Regrettably, in February 2023 Mr Breeze Mahlangu, an operator at Zibulo tragically passed away following complications after an accident in December 2022. We continue to work at being a fatality-free business.

We generated adjusted operating free cash flow of R18.1 billion, compared to R3.9 billion last year. Despite losing close to 3Mt of export saleable production volumes as a direct result of the poor Transnet Freight Rail (TFR) performance, we achieved more than four-fold increase in cash generation.

While the acquisition of the Ensham Business will be paid for from cash on hand at year end, it will materially change the overall structure of the Group, including our liquidity needs. Accordingly, we have secured access to R3.2 billion in credit facilities with leading South African banks to reflect this change, as well as to bolster our resilience against continued poor rail performance by maintaining a sufficient level of liquidity.

The outstanding results and solid liquidity position enabled Thungela to declare a final ordinary cash dividend of R40 per share. This final dividend represents an overall return to shareholders of R5.68 billion. Combined with the 2022 interim dividend of R60 per share, this amounts to a total dividend declared for the full year of R100 per share and brings the total returns to Thungela shareholders to R13.8 billion, representing 76% of adjusted operating free cash flow of R18.1 billion for the year.

July Ndlovu, CEO of Thungela commented: “In 2022 we continued to deliver on our purpose of responsibly creating a shared future. Our outstanding performance in this reporting period is largely due to strong coal prices but it is also testament to the agility and the resilience of our people in operating in a severely constrained rail environment.”.

Driving ESG aspirations

The Sisonke Employee Empowerment Scheme and Nkulo Community Partnership Trust will receive a combined contribution of R396 million in addition to the R500 million contributed with respect to the first half of the year, delivering on our aspiration to spike on the social aspect of ESG. In addition, we have contributed R8.5 billion in income taxes and royalties to the South African fiscus in 2022.

In line with the commitment we made last year, we have completed a full review of our intermediate emissions reduction opportunities and commit to reducing our scope 1 and 2 emissions by 30% by 2030 (using 2021 emissions as a baseline) and reaching net zero by 2050.

Further details on the group’s pathway to net zero will be published in April 2023 in our maiden Climate Change Report aligned to the requirements of the Task Force on Climate-Related Financial Disclosures (TCFD).

Effectively executing on strategic priorities

We have made significant progress in executing our strategy announced in 2022. Aligned to our strategic priority of maximising the full potential of existing assets, the board approved the development of the Elders production replacement project, an integral part of our equity story. We continue to progress on the feasibility study for the Zibulo North Shaft life extension project and expect to submit this for board consideration in 2023. We are also evaluating potential development options for our significant gas resources in Limpopo.

On the optimisation of capital allocation, in November 2022 we acquired the remaining 27% shareholding in Anglo American Inyosi Coal (AAIC), the entity which holds Zibulo and Elders. This transaction will allow us to benefit from the full economics of the cash generative assets in our portfolio, resulting in an increase in earnings attributable to equity shareholders of Thungela.

The creation of diversification options remains an important focus for our business as we plan for the future. In February 2023, we announced the acquisition of a controlling shareholding in the Ensham thermal coal business in Australia. This transaction, funded from our cash on hand at year end, is expected to conclude by mid-2023, marking an important milestone in our journey as it will deliver geographic diversification through a highly cash-generative thermal coal asset with long-life potential.

Outlook

Looking ahead, although thermal coal prices have softened in early 2023, the fundamentals remain firmly in place. Prices can be expected to remain robust, however we are unlikely to see the historic price levels observed in 2022. Over the longer term, Thungela anticipates continued strong coal demand from emerging markets, especially those in Asia, where coal is likely to remain part of the energy mix for at least the next two decades.

Given TFR’s poor performance in 2022, we have reset our production outlook for 2023. Export saleable production guidance for 2023 is between 10.5 Mt and 12.5 Mt, as we plan to drawdown on the high-on mine stockpiles to the extent that the rail performance exceeds production levels.

Our guidance for FOB cost per export tonne for 2023 is between R1,047 and R1,180 excluding royalties. Including royalties, the guidance range is between R1,131 and R1,264 per tonne using a forecast Benchmark coal price of USD130 per tonne.
Our sustaining capital expenditure is expected to be between R1.3 billion and R1.5 billion. Expansionary CAPEX is expected to be between R1.6 billion and R1.8 billion, relating primarily to R1.2 billion for Elders and R0.5 billion for Zibulo North Shaft.

“I look ahead with a sense of caution in the short term, yet confidence in the longer term. In the short term, fixing the rail network is a matter of critical importance to South Africa as the mining industry delivers far-reaching benefits such as sustained jobs and livelihoods in our communities, and it contributes significantly to the economy.

We will continue working with Transnet to resolve the issues plaguing the rail performance and call on government to support these efforts to ensure that the mining industry can continue to create value together for South Africa and its people.” Ndlovu concluded.

ENDS

On Thursday, 4 May, Thungela handed over two completed Social and Labour Plan (SLP) projects to the Emalahleni Local Municipality – the new Phola Fire Station and the revamped Ogies Taxi Rank. These initiatives signify the company’s continued dedication to the Ogies and Phola communities and its promise to continue investing in projects and facilities that benefit residents.

Creating access to emergency response services

The Phola Fire Station, which forms part of the Zibulo Colliery’s social and labour plan (SLP) will assist the municipality’s under-resourced emergency department, enabling it to respond to fire outbreaks more effectively. The fire station will significantly enhance access to vital emergency response services in a community that has experienced a growth in population. Until recently, Ogies’ nearest fire station was 30km away and had limited resources. The Phola Fire Station will provide much-needed relief to existing emergency services infrastructure and reduce the local emergency response times.

“We have seen an increase in fire incidents recently. Because of load shedding many of our residents have resorted to using fire in their homes. So, the timing of this donation could not be better. The fire station should serve as a centre of excellence where the community benefits through programmes that address fire safety. We thank Thungela for meeting this essential need and bringing this fire station closer to the community,” says Councilor Connie Nkalitshana, Emalahleni Local Municipality executive mayor.

Heeding the call for improved commuter facilities

Due to a large population in the community using public transport, Thungela partnered with the Ogies Phola Taxi Association and the Emalahleni Local Municipality to renovate the taxi rank in Ogies. The renovations included the painting of the facility, revamping the kitchen and ablution area inside the office space. In addition, a boardroom and an outside ablution facility was constructed for commuters. The boardroom will be earmarked for use during community engagement meetings.

Mpumi Sithole, executive head of corporate affairs, said “As Thungela, we are pleased to be a member of the community and to hand over these facilities to our partners, the community, and the municipality. Meeting our SLP commitments is critical to us achieving our business objectives of driving our ESG ambitions. The fire station is an important infrastructure that is necessary for emergency response. The upgraded facilities at the taxi rank will provide commuters and informal traders a functional and safe space. I am particularly proud that both these projects were awarded to a local, woman owned-construction company which in turn created job opportunities for the community members.”

Sindane Masombuka, Ogies Phola Taxi Association chairperson, said “The work that Thungela has done for our community is significant. The boardroom will help us run matters of the association more effectively. We are grateful to Thungela for their contribution.”

ENDS

Thuthukani, an enterprise and supplier development program by Thungela, successfully produced its first group of enterprise development graduates Thungela, in partnership with Raizcorp provide host community entrepreneurs with practical, hands-on entrepreneurial learning, technical enablement, development and mentorship to help entrepreneurs expand their business knowledge a become profitable and sustainable into the future.

Today, a total of 14 local entrepreneurs celebrated their successful completion of the program which entailed three critical areas: developing a robust business case, understanding business operations, and establishing a market presence. Over the course of the program, the beneficiaries completed 22 comprehensive modules, covering essential aspects of business development.

“The Thuthukani program has equipped the beneficiaries with a well-rounded skill set in enterprise development, providing them with the necessary competence and knowledge to successfully launch and grow their businesses. This comprehensive approach ensures that they are well-prepared for the challenges and opportunities of the business landscape” said Sandile Mkono, Thungela's enterprise and supplier development manager.

Mthobisi Thomo, Owner of One Day Job Solutions, a water purification and bottled water supplier, said "The Thuthukani enterprise development programme provided invaluable assistance in enhancing my understanding of financial management. It equipped me with the necessary skills to effectively handle finances as a small business and effectively manage cash flow.

Personally, the program greatly benefited me in the financial management of my business. Previously, I struggled with accurate bookkeeping, but the knowledge I have gained has empowered me to conduct my finances with precision."

To learn more about Thuthukani, please visit our website at: https://www.thungela.com/suppliers/our-development-programme

ENDS

For further information, please contact:
Wayne Mokhethi
wayne.mokhethi@thungela.com
073 894 7689

Thungela has been recognised with six awards at the 2023 CoalSAFE Conference hosted by the South African Colliery Managers’ Association in Johannesburg on 10 May 2023, under the theme “Responsible Coal Mining Stewards”. These accolades serve as a testament to our unwavering commitment to the well-being and security of our employees, as well as the communities in which we operate.

SAFETY:

• Thungela was recognised for operating fatality-free in 2022.
• Khwezela Colliery: 12,000 fatality-free production shifts (FFPS).
• Khwezela Colliery: Lost-time frequency rate of zero for 2022.
• Isibonelo Colliery: 12,802 fatality-free production shifts.

Thungela was recognised for operating fatality-free in 2022. Khwezela Colliery received anaward for the Zero LTI Frequency Rate and achieving 12 000 fatality-free shifts, while the Isibonelo Colliery was recognised for 12 802 fatality-free shifts. To achieve these results, Thungela introduced a transformation process to strengthen its safety culture and reduce risk in the workplace. This included training, coaching, and education to embed risk awareness into daily routines. It also implemented a work management model at four operations, improving planning and resource allocation, and reducing pressure on frontline leaders.

“Thungela's awards at the CoalSAFE Conference showcase our commitment to responsible coal mining stewardship. There is a clear need for safe mining, and it is great to see how the coal industry in Mpumalanga is stepping up to this challenge “said Carina Venter, executive head of safety, health, and environment.

COMMUNITY DEVELOPMENT:

• 1st place: Goedehoop Colliery’s Mpumalanga Stainless Initiative.
• 3rd place: Goedehoop Colliery for its support of Becca Farming and Projects.

In the community development category, Thungela’s Goedehoop Colliery was awarded first place for the Mpumalanga Stainless steel Initiative (MSI) which saw the acquisition of a cutting-edge machine with the support of contracting partners, Komatsu Mining and Columbus. This has significantly bolstered the level of support the MSI offers to steel fabricators in the Middelburg area, enabling them to access untapped markets and expand their scope with high-precision work. The machine can cut a range of material thicknesses without limitation to the shape of the product required. This acquisition has resulted in the creation of 49 new jobs and sustained employment for 73 people.

Placing third is Goedehoop’s support provided to the BECCA Farming Projects, a local SMME that cultivates its peach orchard on a 121-hectare farm near Middelburg. The support provided forms part of the mine’s “Tool of the Trade” initiative which provides local small businesses with equipment required to succeed.

BECCA Farming Projects was provided with much-needed agricultural equipment, tools, and PPE. Through this support BECCA, Farming projects made significant strides in job creation, employing 11 individuals. “Community development projects like these help us address local challenges and foster socio-economic development. We believe that by supporting our communities, we can make a meaningful and lasting impact on their lives. Thungela congratulates all the winners and is honoured to play a role in creating a shared future that we can be proud of,” Venter concludes.

ENDS

For further information, please contact:
Wayne Mokhethi
wayne.mokhethi@thungela.com
073 894 7689

Key features

• Total Recordable Case Frequency Rate (TRCFR) improved from 1.59 in June 20221 to 1.33 in June 2023.
• Profit for the reporting period of R3.0 billion reflecting a significant decrease in thermal coal prices (H1 2022: R9.6 billion)
• Headline earnings of R22.46 per share (H1 2022: R67.23)
• Adjusted operating free cash flow* of R4.3 billion (H1 2022: R8.9 billion) and balance sheet strength intact with net cash* position of R13.6 billion (H1 2022: R14.8 billion)
• Interim dividend of R10 per share declared, being 33% of adjusted operating free cash flow, resulting in R1.4 billion returned to shareholders
• Delivered on the commitment to shared value with a R156 million distribution to Sisonke Employee Empowerment Scheme and Nkulo Community Partnership Trust

Thungela Resources Limited (“Thungela” or “Group”), a leading South African thermal coal exporter, has announced its interim results for the six-month period ended 30 June 2023.

The safety of our people remains our first value. Regrettably, a fatality was recorded when, Mr Breeze Mahlangu passed away in February following complications from an accident in December 2022.

The Group generated an adjusted EBITDA of R4.4 billion and an adjusted operating free cash flow of R4.3 billion for the reporting period. Net profit was R3.0 billion (R22.45 per share). Thungela's balance sheet remained strong, with a net cash position of R13.6 billion at 30 June 2023.

July Ndlovu, CEO of Thungela, commented, “We are confident that we have taken considered actions to enhance our resilience as a business to allow us to navigate the challenging market conditions, including softer coal prices, inflationary pressures, and the persistent underperformance of Transnet Freight Rail.

Safety is a core value that has primacy in everything we do. We continue our pursuit of a fatality free business. We report an improvement in our TRCFR from 1.59 in June 2022 to 1.33 in June 2023.

Given the context we are operating within, we have set ourselves up to be resilient to weaker short-term market conditions and are ready to take advantage of improved conditions as they arise. We reduced the number of underground sections at some operations where we are facing increasingly complex geological conditions, while ramping up production at Khwezela. Our focus to increase our competitiveness by improving productivity will produce superior results for our shareholders.”

Resilience to challenging market conditions

The most notable external factor of the period was the sharp fall in the benchmark seaborne coal price as European buying slowed after a mild winter. In addition, global inflation management resulted in slower growth and a related reduction in demand for energy.

Locally, the continuing underperformance of TFR hampered the business’s ability to operate optimally. Following a particularly poor first quarter, rail performance stabilised in the second quarter, notwithstanding two derailments that cost Thungela at least 340kt in rail capacity. Improvements in rail performance during the second quarter were the result of intensive collaboration between TFR and the South African coal industry, including Thungela.

“A consistently performing and well-managed bulk rail infrastructure is critical to the coal mining industry and the South African economy. Through ongoing collaboration with TFR, we are dedicated to optimising the performance of this critical infrastructure, benefiting both our operations and those of the broader South African coal industry”, says Ndlovu.

ESG commitment

Thungela’s purpose is to responsibly create value together for a shared future. Delivering on its aspiration to spike in the social aspect of its environmental, social and governance efforts, the Sisonke Employee Empowerment Scheme and the Nkulo Community Partnership Trust will receive a contribution of R156 million based on the Group’s performance in the first half of 2023. This exemplifies its dedication to enriching the lives of its workforce and the communities in which it operates.
We recognise the critical importance of addressing climate change and have committed to reducing the environmental impact of our operations by reducing Scope 1 and 2 emissions by 30% by 2030, using 2021 emissions as a baseline. The long-term objective is to reach net zero emissions by 2050.

Preserving shareholder value through robust capital allocation

Our capital allocation framework seeks to create long term shared value for all stakeholders.

Board approval of the Zibulo North Shaft project meets the group’s objective of maximising value from existing assets. With a budgeted capital cost of R2.4 billion, this project is set to extend the operational lifespan of Thungela’s flagship Zibulo operation by 10-12 years. The anticipated completion of the Elders and Zibulo North Shaft projects, with approximately R3.8 billion yet to be invested, is integral to enhancing the quality of our portfolio, our competitiveness and extending the life of our business.
We are making good progress on the Elders production replacement project approved by the board last year and expect first coal from the underground operation by the first half of 2024, in line with our original target.

Geographic diversification

Thungela announced the proposed acquisition of Ensham Coal Mine in Australia in February 2023 and the completion of this transaction will mark a significant step in Thungela’s strategy to pursue geographical diversification and enhance the resilience of its portfolio.

Ensham will be acquired at a cost of approximately R4.1 billion and is set to be earnings and cash flow accretive, with strong potential for a short payback period.

The transaction is projected to close on 31 August 2023, and a comprehensive roadmap has been prepared to ensure alignment regarding priorities, governance and other aspects of integration.

Looking ahead

Based on operations for the first six months of the year – and excluding Ensham until the transaction has been completed – the Group has updated its operational outlook for 2023 with the export saleable production guidance for the year revised to between 11.5Mt and 12.5 Mt.

The FOB cost per export tonne guidance for 2023 has been also been revised. This cost excluding royalties is expected to be between R1,120 and R1,200 per tonne. Including royalties, the guidance range has been revised to between R1,170 and R1,250 per tonne based on a forecast benchmark coal price of USD100 per tonne.

“While much of the focus in the next half of the year will be on productivity and cost improvements, it is important to emphasise that realising our strategic objectives always goes hand-in-hand with operating responsibly,” says July Ndlovu. “This involves ensuring the health and safety of our employees, the fulfilment of our responsibilities to the environment and meeting our social obligations. It also requires that, together with industry, government, and Transnet, we continue a relentless journey to find sustainable solutions to the logistics challenges facing South Africa.

Market fundamentals remain strong and there are reasons to remain optimistic. We are confident that our strategy and resilience will allow us to weather the challenging market conditions.”

End

Media
Wayne Mokhethi
wayne.mokhethi@thungela.com
+27 (0)73 894 7689

Tarryn Genis
tarryn.genis@thungela.com
+27 (0)82 324 4650

Investor Relations
Ryan Africa
Ryan.africa@thungela.com
+27 (0)11 638 0237

Mafube Coal held a symbolic sod-turning ceremony at the Sikhululiwe Village Sports Ground on Tuesday. This ceremony marks the official beginning of the construction of a shorter access road that will give the community easy access to the R104 towards Belfast and Middleburg.

The access road forms part of the Mafube Coal’s socio economic development strategy and has been identified in order to uplift the communities by improving basic infrastructure. Mafube Coal’s general manager, Shepherd Nkadimeng said, “The construction of the road is projected to cost R29million and will provide an opportunity to a local construction company that will in turn hire local labour to uplift lives of the communities where we operate.

Infrastructure development is about creating opportunities to positively impact the lives of our communities. Roads are about creating access to opportunities, connecting families, and ensuring continuous improvement to service delivery and this is why we have partnered with local government authorities and community leaders to bring this initiative to life.”

The new road, spanning 3.465km, aims to reshape the landscape of Sikhululiwe Village, neighbouring farms and will solve the community’s struggle to gain access to and from the village due to deteriorated roads as a result of erosion.

The current 5.1km gravel road will undergo a remarkable transformation, shortening the travel distance by an impressive 1.635km and emerging as a tarred route that will create greater reach to schools, healthcare centres and municipality facilities by ensuring that valuable time is not lost in travel.

Speaking during the ceremony, the MEC of Public Works, Roads and Transport Hon MP Ndlovu welcomed and applauded the commitment by Mafube Coal and all the involved stakeholders to implement the project that will change the lives of the people of Sikhululiwe Village and the entire Nkangala District.

“Mafube Coal has delivered on the commitment they have made to build this road for the community. As government we appreciate the building of infrastructure and commend the company for not just focussing on profits but sharing their proceeds with the community.” Said MEC of Public Works, Roads and Transport Hon MP Ndlovu.

Located south of the Mafube Coal Mine, in the Steve Tshwete Local Municipality within Nkangala District, Mpumalanga Province, the project’s significance extends beyond its physical boundaries. The collaboration between the local government and Mafube exemplifies how unity and shared vision can lead to groundbreaking initiatives that touch lives.

The Ward Councillor, Cllr Iddy Mahlangu, a long-time resident in the Sikhululiwe Village, reflected on the unfolding of the road construction project and said, “The project signifies a monumental leap for our village. The prospect of a well-constructed road brings a renewed sense of hope. We can't wait to witness our community thrive.”

Among other opportunities, the construction of the Sikhululiwe Village Road project will generate a range of jobs across various sectors. Some of the potential job roles include construction workers, heavy equipment operators and drivers, maintenance workers and cleaners. More than 30 jobs will be created for the neighbouring communities as well as subcontracting opportunities.

The project is anticipated to be completed by April 2024.

ENDS

Earlier this year Thungela announced that it will acquire a majority shareholding interest in Sungela Holdings, which in turn will acquire an 85% interest in the Ensham Business.

Thungela is pleased to announce that all conditions precedent relating to the acquisition have now been fulfilled and that the Transaction has become unconditional. The effective date of completion will be 31 August 2023, and Thungela will assume operational control of the Ensham Business from 1 September 2023.

The acquisition of the Ensham Business is a significant step in Thungela’s strategy to pursue geographic diversification. The Transaction will also allow the Group to leverage its core capabilities in a commodity and mining method which it understands well, while providing access to new markets and to the Newcastle export coal price.
Based on Ensham’s performance up to completion, the mine is expected to produce approximately 2.7Mt of export saleable production (on a 100% basis, at an average quality of 5,850 kcal/kg) in 2023, at an FOB cost of between USD110 and USD120 per tonne.

The terms of the Transaction remain unchanged, save for the fact that the Co-investors are required to apply not less than 90% (previously 70%) of all distributions received from Sungela Holdings to service the Co-investors Mezzanine Loans and that the term of the Loans is revised to 18 months (previously 4 years).

The Transaction was structured to enable Sungela to benefit from the economics of the Ensham Business (subject to certain limits) during the period between 1 January 2023 and the date of completion. The determination of the economic benefit will be finalised over a period of up to three months following completion. The Transaction is also subject to customary working capital adjustments upon completion.

Thungela CEO, July Ndlovu, commented on the Transaction: “We are delighted to welcome our colleagues from Ensham into the Thungela family as they continue to build on a proud history of safe production in the Bowen Basin region of Queensland. We look forward to learning from them and also to sharing our knowledge.“

Thungela is proud to have concluded a landmark Transaction with Idemitsu, a responsible and reputable owner with well-established processes and systems. The Transaction delivers on our purpose to responsibly create value together for a shared future, and we will continue to support existing regional communities while also delivering superior returns for the Group’s shareholders.”
Capitalised terms used in this announcement shall bear the same meanings as those defined in the SENS and RNS announcements dated 3 February 2023.

ENDS

For further information, please contact:
Tarryn Genis
tarryn.genis@thungela.com
082 324 4650