Tshipi omits interim dividend amid manganese downturn

The board of South Africa’s Tshipi é Ntle manganese mine has decided not to pay a dividend to shareholders for the six months to 30 June due to the recent downturn in the global manganese market.

“This decision was made in the interests of conservatism given the unpredictability of the current manganese ore market and, in particular, uncertainty as to the extent and duration of the current down trend in the manganese ore price,” said Australian-based Jupiter Mines in its preliminary annual report.

Jupiter has a 49.9% stake in Tshipi, with the remaining 50.1% owned by South Africa’s Ntsimbintle Mining.

Semi-carbonate manganese prices have tumbled by more than 40% over the last two months to around $3.00/dmtu FOB Port Elizabeth due to weak demand from Chinese and Indian ferroalloys producers. The market has erased all of this year’s gains from the halt of South32’s GEMCO exports in mid-March.

The average manganese ore price of Tshipi’s manganese ore was $3.06/dmtu FOB for the six months to 30 June. The mine produced 3.47 mt in financial year ending 30 June.

“Prior to July 2024, Tshipi was expecting a period of elevated manganese ore pricing, for at least the second half of calendar year 2024, due to the GEMCO supply outage,” the company said. “The sharp weakening in both end market conditions and the manganese ore price…was unexpected. Based on prices contractions in recent weeks, it is possible that this market has yet to stabilise.”

Jupiter said Tshipi has “healthy cash on hand”, totalling ZAR995m ($82m). Tshipi’s board will next consider a dividend distribution to shareholders after the 31 December interim reporting period.

Although Tshipi has decided against a dividend, Jupiter will pay its own shareholders a $0.0025 per share dividend for the six months ending 30 June, using funds from its cash reserves.