About recorded presentation, investors will be in listen-only mode. Questions are encouraged, and they can be submitted at any time via the Q&A tab situated in the right corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question it receives in the meeting itself, however, the company can review the questions submitted today and publish responses where it's appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to CEO Phoevos Pouroulis. Good morning, sir.
Good morning and welcome, everyone, to this, our year-end results for the financial year ending 2025, September. I'd like to start off with our mission statement or benevolent intent, which is clearly articulated on the slide, which states that we look to redefine resources, we innovate with purpose, and we look to empower futures. Really, this is the theme that I'd like to carry through while we run through this results presentation. This is the agenda for this morning, running through primarily the financial highlights, but also looking at our business as a whole and the strategic imperatives and the vision 2030. If we look at our business, we believe that we are resilient today, we are future-ready, we have a strong balance sheet that supports our Vision 2030. What is our Vision 2030?
It's to deliver on our expansion and growth plans and opportunities, and to commercialize the technologies and solutions that we've been working on through our novel processes, which we'll unpack later on in this presentation. When we talk about empowering futures responsibly, it really is core to our values, and underpinning this is safety. We're an integrated resources group that covers the full value chain of exploration, mining, processing, beneficiation, marketing, sales, and logistics for both platinum group metals and chrome concentrates. Our commitment to sustainable growth and impactful investment not only returns value to shareholders, but lifts performance, strengthens community relationships, and builds long-term sustaining partnerships. With this comes our disciplined growth strategy, which ultimately leads to disciplined returns, ensuring that we have sustainable multi-generational value. We just touch on our key highlights for the financial year 2025. Safety as our core value really excelled.
We had a lost-time injury frequency rate at the Tharisa Mine of 0.03 incidents per 200,000 man-hours worked, and zero incidents at the Karo Platinum mine site, which is a hive of activity which we'll share with you later in the presentation. We were also acknowledged at two events, the MineSAFE Awards here in South Africa for the best improved safety performance for open-cast mining over the past 3 years, and a Double Silver Award at the 2025 NSSA Safety and Health Workers Award in Zimbabwe, Harare. Also very pleasing to note is that the Tharisa Mine is the first level nine compliant mine in South Africa, and in fact is a test site and a role model for other open-cast miners to come and see technology and the advantages that it does provide in terms of safety and well-being and general efficiency improvements.
Later on, we'll unpack in a lot more detail the developments that we've undertaken during this financial year. Just to highlight them, we've commenced and begun our transition to underground at the Tharisa Mine. We've committed a massive $547 million worth of investment over the next decade. This is underpinned by a new facility of $130 million that was signed with Standard Bank and Absa Bank. Our Karo Platinum Project site is developing in line with the capital that we've allocated, and we continue to de-risk that project. When we talk about redefining resources, it really talks to our co-production model, which is unique in its inception and in its origination, and that is the co-production of platinum group metals and chrome concentrates from the Middle Group reef horizons.
To set the context for the year, we averaged a PGM basket price of some $1,615 per oz for the year, which was up 18.6% from the prior year. Contrary to that, our metallurgical chrome grade price was down some 11% to $266 per ton. This set the scene then for our revenue, which came in at $602.9 million, EBITDA at $187.3 million, with a net profit after tax of $80.8 million for the year. Pleasing to note is net cash from operating activities at some $94 million, with a vast and extensive capital expenditure for the year of some $118.5 million, which includes $33.5 million invested into Karo Platinum. We ended the financial year with cash and cash equivalents of $175.1 million, all of this resulting in headline earnings per share of some $0.275 .
We're pleased to note that the board have approved and recommend to the shareholders an additional $0.015 final year-end dividend, coupled with a half-year, $0.015 already paid out to a total of $0.03 for the year. This, including the share buyback, is a return of 17.2% of net profit after tax to shareholders. I think Michael will unpack in some detail the favorable mining royalty credit that we achieved in a landmark victory in terms of the reversal of our mining royalty at some $67.3 million. When we look at the impact we have and the jobs that we create through our investments, which have a major impact, our group employees and contractors amounted to some 4,483 people for the financial year, of which 27% of those were female employees.
We provided 35 adult learnership bursaries and internships for the year. This is something very close to our heart where we look to share, educate, and allow upliftment in terms of adult education for those that are interested from our communities and our employees. In terms of our impact to the fiscus, currency inflows of some $430.5 million, that's direct and indirect inflows, with global direct, indirect taxes and royalties of some $31.7 million. I think an astounding number and something we're very proud of is the amount of money we spend on BEE historically disadvantaged individuals, women, and BB BEE- compliant procurement of some $331.1 million, a significant contribution to these up-and-coming, growing enterprises. We spent on local and host community suppliers, some $2.6 million. We attract most of our employment from the host communities.
In excess of 40% of our employees come from the host communities. Included in that is our commitment to our SLP programs and CSI initiatives, where we spent some $1.1 million during the financial year. Moving on to our commodities and really what underpins our investment case. We look at the spot prices today of the Tharisa PGM basket, which sits at $2,215 compared to a price for the financial year of just over $1,600, a pleasing improvement in terms of that PGM basket price, as well as the Karo PGM basket price at some $2,024. We'll unpack the prospects and the differences between the Bushveld Complex, particularly on the MG reefs, and the main sulfide zone of the Great Dyke in Zimbabwe.
Ultimately, you can see here the fundamental nature of PGMs and the role they have played and they will play in decarbonizing the planet. If we look at the catalytic properties and applications, they are vast and varied. What's really supported platinum and palladium demand is really the rollback of battery electric vehicle penetration, the tightening of global emission standards, and the pivot to hybrid vehicle production and demand. This has really supported the baseloads demand of those very key and fundamental platinum group metals, including rhodium. Also, we've seen resilient industrial demand from the chemical and petrochemical, electronic sectors, fiberglass and glass sectors supporting rhodium amongst platinum and palladium as well. We're very heartened by future technologies, particularly hydrogen electrolyzers, fuel cells, which have a strong outlook for demand for platinum and iridium.
Ruthenium is an interesting test case because it has always been used in hard storage. With the advent of data centers proliferating and the investment that we see going into artificial intelligence, there has been a big demand driver for data storage, and rhodium has a massive role to play. We have seen that with the price appreciation over the last 12 months, and we believe there is a lot more upside potential for that. I think what really shocked the market and really supported platinum was the investment demand and jewelry demand primarily coming out of China. We continue to see continuous supply deficits, and what this means is that above-ground inventories are being destocked, and we are starting to see tightness in the market supporting the higher PGM basket prices that we are seeing.
If we come closer to home now and we look at the favorable Tharisa Minerals prospect on a 6E basis, you'll see that platinum constitutes almost 53%, palladium at just under 16%, but quite remarkably, rhodium at 10.5%. Michael will talk about the impact of that 10.5% in terms of our revenue. Very little gold, very nice ruthenium at 16%, iridium at 4.5%. Moving to the Great Dyke, you'll see that there's quite a different makeup with platinum at 43.5%, palladium at 38.3%, rhodium at 3.8%, gold significantly more at 8.6%, ruthenium at 3.8%, and iridium at 1.9%. Very nice blend and basket across both jurisdictions. Moving on to our other key commodity, which is chrome, which is really pivotal to decarbonizing the planet.
Again, if we look at the applications in terms of construction steels, white good manufacturing and infrastructure, special alloys, special steels application, heat and corrosion resistant applications, we see a continued growth in terms of stainless steel, which has surprised always to the upside in terms of manufacturing as well as demand. This is not just an Asia-centric story. It is a global growth phenomenon. We start seeing applications in renewable energies as well in the desalination plants, solar, wind, hydro, redox flow, which we'll unpack later, one of our key investments and huge upside potentials, electrolysis, storage of energy, as well as pollution control. What makes stainless steel and chrome hugely environmentally friendly is that it's 100% recyclable. South Africa plays a vital role. As we know, the Bushveld Complex contains more than 72% of the world's resources.
What's really been interesting to note is that we've had a fantastic growth story in terms of our South African chrome manufacturing of concentrates and chrome ores at some 9.6% compounded annual growth rate over the last decade. This is in the context of a struggling ferrochrome industry. There's been a lot of talk and noise around intervention from government in the form of either a quota or a tax. Ultimately, we, along with our peer group, believe that any intervention is most probably misguided and really doesn't talk to the root cause of the challenge, which is the cost of electricity. We know that electricity prices over the last decade have gone up some 900%.
Really, the answer to enable the sustainability of the existing ferrochrome producers whom we support and really look to find a solution for their current challenges is really the cost of electricity. That not only will enable and support existing capacity, but will also stimulate beneficiation. As you'll see later on, we have a very clear beneficiation strategy which looks at some unique and novel approaches to beneficiation of both PGMs and chrome concentrates in South Africa and the region. I'd like to hand over now to Michael, who will run through the financial highlights of the year. Michael, over to you.
Thank you, Phoevos, and good morning and welcome to all those who have joined for our financial results presentation for this financial year ended 30 September 2025.
When I reflect back on this year, I think one of the key themes to me was our continued investment, not only in sustainability of operations, but also in the growth of our projects for multi-generations to come. That includes underground transition at the Tharisa Minerals mine, the Karo Platinum Project, and the commercialization of the R&D at Arxo Metals. Again, our co-product business model has reinforced our resilience effectively with the PGM basket price, as Phoevos mentioned, strengthening by some 18.14% year-on-year, and the chrome price while staying basically range bound, reducing by some 11%. We have continued to be net cash flow generative with cash flow from operations of $94 million, and our cash and cash equivalents standing at $175.1 million as at 30 September. We have continued to maintain our capital discipline, and we've invested, as mentioned, beyond 2030 with multi-generational sustainability.
To support this, and we'll touch on it in more detail later, we have secured an additional $130 million of term loan and revolving credit facilities, principally to fund the underground transition and the mining fleets. Final proposed dividend for the year, $0.015, which matches interim dividend and aligns with our dividend policy. We are in the process of successfully concluding our second $5 million share repurchase program, which as of 30 September was 87% complete. Looking at revenue for the year, the revenue for the year at $602.9 million. Again, key contributor being the chrome at 57.2%. This is on an FCA basis. In other words, we strip out the costs of inland logistics and freight, which is because the prime destination for that chrome is the Chinese market.
Just touching on the graph on the bottom right, you'll see the major production output is on the metallurgical grade, just under 87%, and the balance is specialty grade at 11.3%, which is a higher value item. Just looking at some of the actual numbers themselves, the sales just under 1.4 million tons at an average price of $266 per ton, and that's on a CIF Main Ports China basis. The PGMs contributed just under 40% to our overall revenue. If you look at the graph on the bottom left, you'll see that the platinum remained the major contributor at 38%. While rhodium comprises less than 10% of our prospects, the very strong price performance has resulted in it contributing in excess of 36% to our overall revenue from PGMs. Numbers again, 137,500 oz sold at an average PGM basket price of $1,615 per oz.
If we look at the spot price today, this morning was trading at $2,215, so it's continued its upward trend. This is quite a busy slide. I'm just going to touch on some of the numbers on it. I think very pleasing is the reef tons mined, up 15.3% at 5.3 million tons. If you look at the graph alongside, you'll start seeing the benefit of that from the cost side. Our purchases were only less than 4% of our on-mined cash cost, and that's a direct consequence of the improvements in our reef ton mined. Cost per reef ton mined, very well maintained from a cost perspective, up 3.5% at $41.7 per ton. Tons milled relatively flat at the 5.5 million tons. The on-mined cash cost per ton milled increasing 12.9% to $59.7 per ton.
Our logistics team has done a remarkable job over the year and well managed on our inland logistics and freight costs, with a slight reduction year-on-year at $83.2 per ton. We do operate in a rare environment for Tharisa Minerals and normally benefit from a weakening of the exchange rate. We had no such benefit over this past year with, in fact, a marginal strengthening in the average exchange rate to ZAR 18.1 to the dollar, a strength of some 2.4%. We are a co-producer of both platinum group metals and chrome concentrates. If we just say, what is the all-in cost per platinum oz sold? In other words, we take the credits from chrome and all the other platinum group elements, including the palladium and rhodium and such like, you get a - $445 per platinum oz.
When we calculate that sustaining cost, we do take out the cost of the transition to underground mining as well as a Karo Platinum Project. If we then turn around and say, let's do it on an all-in cost per PGM oz sold, that's on a 6E basis, we apply the same metrics and calculations, you get a cost of $571 per oz. I really like this graph because I do believe that it reflects very nicely the history of the company over the past year. We started for the EBITDA of 2024, and that was $177.6 million. You'll see the favorable impact of the PGM prices offset by reduction in chrome volumes, and then the impact of the chrome price, fairly significant, but taking into account the overall volume sold, and that is a reduction in price of 11%.
Increase in absolute mining cost, and you would have seen on the previous slide the increase in the Reef Tons mine. That really offsets a lot of the mining commodities, which is a purchase and run of mine ore, so there is almost an offset on that basis. Then savings on the processing costs and selling expenses, and we will touch shortly on the mining royalties. Resulting overall increase in our EBITDA by 5.5% to $187.3 million. Our gross profit for the year amounts to $191.3 million and a gross profit margin of 31.7%. If, however, we do offset the mining royalty credit, it does impact on the gross profit %, reducing it to 20.6% year-on-year, but still a very healthy gross profit % in those circumstances.
I'm going to touch briefly on the mining royalty credit, but I think before we start, really just to touch on the accounting side of it, the mining royalty itself is not a tax. It is a lease charge paid for the consumption of the resource to the government, and therefore it is a charge to the cost of sales on the income statement and not on the tax charge. The matter at hand relates to a 2015 and 2017 dispute with the South African Revenue Services on the interpretation application of the Mining Royalty Act. This eventually ended up in a tax court. We're very pleased to get a favorable ruling from the tax authorities, and we also engaged with the South African Revenue Services thereafter, and we have agreed the basis of implementing the court's judgment.
This is resulting in a reversal of a previous provision that we had of some $67.3 million, which is a credit to cost of sales. As a consequence, you have a royalty receivable of some $13.6 million, and because of increased income tax and income tax impact of some $18.2 million. A very favorable outcome and one that is going to stand us in good stead in the years to come. In effect, what it did, it reduced the mining royalty payable to the minimum percentage over this period to 0.5%. Over this past year, we spent $118.5 million in our capital expenditure, and that is both in sustaining operations as well as growth projects. I'm just touching some of the key numbers there.
$33.5 million invested in Karo Platinum, $12.6 million, which is a fairly nominal amount to date on the underground development as we commence that transition, and then $9.8 million on the deferred stripping. The prior year was some $65 million on deferred stripping. Group capital commitments as of 30 September, $79.6 million, of which Karo Platinum comprised $25 million. Just look at the year ahead, capital budget of $165.9 million. This excludes Karo Platinum. We'll touch on Karo Platinum in more detail in the presentation, but effectively, once the funding is closed, there'll be a strong acceleration in the spend on Karo Platinum. We also excluded the deferred stripping to really focus on the actual capital items that we're investing in. You'll notice there on the charts on the right that the largest expenditure at the moment is underground development at $76.7 million as we accelerate that capital spend.
There's also an increase in assets and infrastructure, and importantly, the R&D and innovation as we start commercializing some of the downstream research results from the Arxo Metals. Our balance sheet has remained strong through this period with cash and cash equivalents of $175.1 million, generation of cash from operations $94 million, and net cash of $69.8 million. The table on the right, I think, really reflects it quite nicely if you have a look at the depiction there. Net cash from operations $94 million, sustaining capital of $77 million, so a free cash flow after investing in sustaining operations of $17 million, the $44 million on the growth projects, and a marginal negative- free cash flow for the year of $27 million. Total debt is $105.3 million, of which short term is $74 million.
You'll notice on the pie charts on the bottom right, that's the bond of 26.2% is a large portion of that. Subsequent to the financial reporting period, we have negotiated and agreed with the bondholders to extend that bond by a further three years with redemption on 1 December 2028, so that'll be transferred back into a long-term debt facility. Our commodity prices are dollar-based. That's for both platinum group metals and chrome concentrates. We do have a tendency to have a bias towards dollar-based debt. 67.4% is USD denominated. It does have a natural hedge element. As mentioned, our balance sheet remains healthy, current ratio of 2x , and a net debt to equity of a favorable 8.2%. We do have undrawn facilities as of 30 September of $76.6 million, and that excludes the trade finance facilities.
We pride ourselves on our commitment to capital discipline, in particular the return of funds to shareholders. We have proposed interim dividend of $0.015 per share to align with the, sorry, final dividend of $0.015 per share. It aligns with interim dividend and is offered due consideration for the mining royalty credit, which is to large extents a non-cash flow item. If we include the share repurchase program, it is a payment of 17.2% of our consolidated net profit after tax. Over the past 10 years, we have distributed $119.8 million as distributions to shareholders. This excludes the two share repurchase programs. The one completed, I think it was last year, at $5 million, and we're 87% complete as at the end of the financial year on the second one, which is again has been a very successful outcome overall.
I'd like to now hand over back to Phoevos. Thank you.
Thank you, Michael. We move on now to our expansion projects and really taking a snapshot view of our facilities across the globe. Redox One, which is our long-duration energy storage business, is situated in Dortmund in Germany, moving south to Harare, where we have our Karo Platinum Project situated on the Great Dyke, and then into Tharisa Minerals on the southwestern end of the Bushveld Complex. Adjacent to the mine is the Arxo Metals Renewable Energy Center, where we do renewable energy projects as well as the manufacturing of the elyte for the Redox One batteries. In Brits, not too far from the mine, we have our Arxo Metals beneficiation site. We utilize three ports for the export of our commodities: Maputo in Mozambique, Richards Bay, and Durban from South Africa.
As mentioned, we look to unlock multi-generational value, and the transition to underground was always envisaged when we embarked on the Tharisa Minerals mine. We will start in a phased approach on the West mine, which is illustrated in the photograph there, and we are currently busy with the portal Make Safe, and we envisage that our first ore from this Apollo complex portal will be delivered in Q2 of this financial year, financial year 2026, achieving steady- state 3 years thereafter in Q3 of FY 2029. The Apollo portal complex, just to remind everybody, is a dual reef complex on the MG2 and MG4 seams with a 3-meter cut respectively in each of those portal developments. The average monthly run of mine or reef production will be 255,000 tons per month at that steady-state level.
As we transition and start depleting the open pit, we will commence with the Orion portal development in the East mine, and that will deliver our first ore in the fourth quarter of financial year 2031, thereafter reaching steady-state in Q3 of financial year 2033. At that point in time, the Tharisa complex and mine will be fully underground and will be sustainable for at least 50-60 years in terms of the current mine plans on that trajectory. You'll see that the Orion portal complex is limited to 210,000 tons per month, and that's purely a function of our nameplate processing capacity, which is 5.6 million tons. However, it is designed to match the Apollo at 255,000 tons, and there is potential for us to increase our throughput to over 6 million tons per annum of processing capacity.
Just to look at the numbers and the strategic capital investment over the next decade, the capital allocated to Apollo is some $363 million, followed thereafter in the timeline I just outlined by the Orion complex at $184 million. Due to the fact that we're doing on-reef development and we'll be generating income, we have a peak funding number that is considerably lower at some $173 million over the period of the underground development. Our DFS has given us an all-in sustaining cost of mining, including capital development of $40.8 per ton. Michael has mentioned the cash on hand at $175 million and the ring-fenced funding of $130 million for the underground, coupled with asset-backed finance of some $45 million. Even though we are going with the contractor mining model, we will be acquiring and purchasing the mining fleet for the underground so that it will remain our assets.
I think what's pleasing to note is that the DFS kicked out an IRR of 25%, assuming a PGM basket price of $1,633 per oz. You can imagine at today's $2,200 per oz, the IRR is significantly improved. When we look at the Tharisa Minerals and the Tharisa Mine annual output, you can see us incrementally growing as we transition to less diluted, more consistent fresh ore from the underground, achieving our 2 million tons of chrome concentrate and 200,000 oz per year of PGMs on a sustainable basis from 2033 onwards. We believe we can maintain that run rate for the duration of the underground operations, some 50 years, as mentioned. Moving to the Great Dyke of Zimbabwe, we really have been blessed and endowed with a tier one resource.
It is only one of two major PGM projects under construction worldwide in a sector that we well know is facing growing deficit. What is our vision here is to become a globally significant low-cost producer of these very key and precious metals, including some significant base metal credits of copper, nickel, and cobalt. When we talk about responsible growth, we talk about balancing profitability with environmental care and, importantly, the community benefit and upliftment that a project and an ecosystem of this magnitude can provide. The long-term impact here is that we'll be positioned very much like the Tharisa Mine to provide multi-generational output and value creation. We are situated in the middle chamber of the Great Dyke complex in Zimbabwe, some 100 km southwest of Harare.
The phase I operation is planned to produce 2.64 million tons of run of mine per annum, generating some 220,000 PGM oz on an annualized basis. Our resources and reserves in the open pit, which is a 10-year life, which is our phase I, 12 million oz of resource, 2.3 million oz of reserve with a total resource that includes underground of 96 million oz, with a potential again of some 50 years. In terms of infrastructure, we've secured the water. Electricity supply agreement is secured. We have a renewable energy program of 40 MVA solar to be installed post-commissioning, and we have very easy access with tar roads from Harare. What is really pleasing to note is that this project has substantially been de-risked. We've drilled some 60 km of diamond core geological exploration drilling with a high confidence.
We have already defined the 10-year open pit mine, and that plan is complete with an underground drilling infill program to confirm the 50-year potential as well as the feasibility study, which will follow the infill drilling campaign, which is well underway. All metallurgical test work has been concluded, and we have a great degree of confidence in our recoveries of both PGMs and base metals from the lock cycle test work that has been completed. In terms of infrastructure and mining, you'll see an aerial photo. There is substantial work that has been done to date. Design and engineering is complete. Earthworks are complete. Civil works are some 68% complete. Ninety percent of all long lead equipment items have been procured and in storage, and some have been delivered to site like the mills, which have been installed, as well as bulk water and power being secured.
We did complete a pilot open pit mining with equipment being tested and selected for the type of open pit mining that we'll be doing. We have invested to date some $193 million, substantially de-risking this project. The capital and operating costs that we have are confirmed well beyond a definitive feasibility study level. When we look at the concentrator area and the infrastructure, we have a vast program to increase the Chirundazi Dam. We commenced that earlier in this year. We are at 27% completion, and that is forecast to be complete in June of next year. The mill building, the steel work is some 78% complete, forecast to be complete in January. The overhead line, the 132 kV line, 25% of the base stations are complete.
Twenty-eight of the 130 poles have been installed in terms of the bottom sections, and we forecast this very key and important power supply from the Saloo substation to be complete in February next year. The MV building is 37% complete, forecast completion in June next year, and the LV building on the wet end is 100% complete. Here are some photographs just to illustrate some of the work that I outlined on the previous presentation, and you'll see the substations, the MV building, and the complete LV substation building on the bottom left-hand side. The aerial view shows the vast footprint that this processing plant and adjacent facilities occupies. You'll see that the primary and secondary mills have been installed on their plinths with the steel work and support structures being installed as we speak.
You'll see on the top right-hand and bottom right-hand images the Chirundazi Dam, which is an existing dam, and we're expanding that dam, which has a real material positive impact for farmers, rural farmers in the area, providing them with security of water supply as well as securing our water requirements for the Karo project for decades to come. We're very pleased to announce that we've awarded the mining contract to EPSA, who are a Tier 1 global mining company that have been in existence since 1962. They're a global enterprise. They do operate in Africa, but this will be their first contract in Zimbabwe. Mobilization has commenced, as well as site establishment, and they've commenced with the onboarding of all the regulatory approvals as well as employees in country.
Equipment assembly and delivery will commence early in the new year, and the first phase is really early waste stripping, which will commence towards the end of Q1 2026. This was a major milestone achievement for us, attracting a mining contractor of this caliber that has a glowing track record from South America to Australia and Africa and Europe. I would like to hand back to Michael now just to touch on the funding update and to provide a context of the current PGM market for you. Thank you.
Good. Thank you, Phoevos. If we have a look at the Karo Platinum Project on the funding, Tharisa itself has committed equity of $178 million. We have secured funding through the bond that is listed on the Victoria Falls Stock Exchange, as mentioned earlier, that has been extended by a three-year term. That is $37 million. Very pleasing.
Our senior debt is well advanced. We recently received the, I suppose, the final outstanding work, which was the technical advisor's report on the projects received by the lenders and ourselves. That is busy being worked through. The next step is effectively taking it through to credit. The disappointing thing is the credit committee is closed in about nine days' time, so it will probably roll over into the new year. In conjunction with that senior debt, one of the parties is providing mezzanine debt of $25 million, so that will run in parallel. Also, to ensure that we have a fully funded project, we are in discussions with both a strategic investment as well as a goal scheme as an alternative to secure some $125 million to ensure that the project is fully funded.
I think we just look at the bar charts, the little charts on the bottom below the graph. You'll see that the spot price at the moment, $2,008 per oz, that's for the Karo Platinum Project split. The financial model with an all-in sustaining cost of $850 per oz and therefore a very healthy margin at some 45% going forward. I think we also look at the graph above. You'll also notice that a number of the analysts, analyst one, analyst two in particular, are really forecasting further strong recoveries in the PGM basket price, and I think that will all go well for the project going forward. That is a very brief overview of that financing. I'll hand back to Phoevos. Thank you.
Thanks, Michael.
The third or the second pillar of our benevolent intent is innovating with purpose, and this is something we're very passionate about, and we capture this in our wholly owned subsidiary, Arxo Metals, where we've challenged convention over the past decade, and we are busy commercializing five novel mine-to-metal beneficiation processes. I think for a business our size, the commitment and the capital that we've deployed responsibly and in a measured fashion will really bear fruit in the future. These processes have been developed in-house from ideation to laboratory-scale test work and to commercial-scale operations, including pyromet as well as hydromet operations that exist across multiple sites that we occupy or we share with institutions. We are constantly looking and evaluating the potential of additional metals and the full value chain contained within our basket of commodities, the polymetallic nature of the ore bodies that we mine.
The Vulcan complex, I think, is most probably the first full-scale commercialization of an in-house grown technology where we've successfully commercialized the ultra-fine chrome recovery at the Tharisa Mine and are looking at further opportunities of deployment of these technologies. When we look at, apologies, when we look at the three routes here of beneficiation, we have the PGM beneficiation route, which looks at us taking our concentrate that historically we've sold, putting it through a pyromet process, and then processing it and refining it through a novel patented process called the chloroplast process. We're busy installing our first commercial reactor to pilot and demonstrate the end-to-end production of 495 purity PGM metals. In terms of the novel chrome alloy route, we have two routes there.
The one is a stainless steel route, and the other is a grinding media route, and we've produced both products and, in fact, sold some of the grinding media alloy to producers of that media. In terms of the energy applications, we have our wholly owned subsidiary, Redox One, which I will unpack on this slide here. We really see a lot of excitement and interest in battery energy storage. One of the key challenges the world is facing is how do you store all this additional energy that is being generated from renewable energy, be it solar, wind, and even hydro, to a lesser degree, to provide base load power. This is where long-duration energy storage systems come in and Redox Flow in particular.
We have been working on this technology since 2018, and one of the key developments and IPs that we have is the ability for us to produce electrolyte from the chrome concentrate that we produce. That electrolyte is a chrome chemical and an iron chemical, and we are taking the cheapest form of the metals, and we are converting them into highly cost-competitive electrolyte. Key to these systems is that they are inert, there are no environmental challenges, and they are 100% recyclable. They have a long duration life of some 20 years at minimum. We believe that the electrolyte will continue to perform beyond that, but in the event that they are decommissioned, they can be recycled and utilized in multiple industries.
We have undergone rigorous component and electrolyte system testing, and in 2026, we're very excited to deploy the first megawatt-scale battery at the Tharisa Mine, at Tharisa Minerals, and with a further five demonstration units to be deployed globally. As I say, there's huge interest from multiple jurisdictions and regions around the globe for cost-effective, sustainable, long energy duration. When we look at the third pillar, empowering futures, this is something very close to our heart, and we can see the impact that we have, not only in the form of employment and sustainable employment at that, but the impact that the supply chain has, as well as the multiplier effect and the micro ecosystem that is created around these mining communities.
We're in a very privileged position where we have these long-life resources that allow us to invest in people, in the environment, and into sustainable security of supply. As we've seen from the geopolitics and the scramble for these critical minerals, we as Tharisa are strategically positioned to provide a secure supply line of these key strategic materials for generations to come, and not only being a secure supplier, but also to be a continuous impact and force for change and positivity in terms of sustainable jobs, sustainable impact, and value creation for all stakeholders. If we look at our core investment thesis, why invest in Tharisa? We have an entrenched footprint in strategic commodities that have long-life asset bases, and we have exposure to these very unique and special polymetallics of platinum group metals as well as chrome.
We have a clear visibility growth to Vision 2030 and beyond to deliver and commercialize on our downstream initiatives. We have a resilient balance sheet that is geared for growth, and we're positioned to leverage this efficiently and effectively. Our capital discipline has been enforced for over a decade where we've returned significant value to shareholders, and we've been able to fund our pipeline growth. Importantly, where we're positioned today, we see fundamental deep value, and this is consistent with delivery and profitability. If you look at our multiples on a price-to-earnings basis at spot, we're trading at a 4.4x multiple, price-to-NAV at 0.4x NAV, a significant discount to our peers who are trading at least 3x higher on those multiples. When we look at where we'll be in 2030, unlocking multi-generational value, we'll be a smarter operation with lower emissions reduced by 30%.
The Apollo mine will be fully operational and at steady-state. Orion will be under development, Karo Platinum producing 220,000 oz per annum and with some base metal co-extraction commencing at Karo Platinum. Arxo Metals will have commercialized and produced final PGMs from the Tharisa Mine as well as chrome alloy and electrolyte production. Redox One, we would look to deploy 1 GW of energy storage and be deployed globally. With that, I'd like to recap on our next 5 years' worth of journey, which is to deliver on expansion in terms of our growth opportunities at the Tharisa Mine and Karo, as well as commercialize our technological solutions, redefining resources, innovating with purpose, and empowering futures. I'd like to thank you for your time and hand over to Ilja for the Q&A. Thank you.
Thank you, Phoevos. Let me start straight with you.
We've had a question here on the operationals. What drove the strong increase in the reef mine and obviously following through onto the EBITDA? How will you build on this momentum?
Yeah, thanks for that question. If you recall that we were mining a backlog of waste stripping in the financial year 2024, we introduced the contractor Trollope Mining on site to help us with that backlog. Part of that was opening up more strike length in the east pit, which then materialized and allowed us to access a broader reef horizon and have more flexibility in the open pit, which then enabled that increase of some 15.3% in our reef mining to 5.3 million tons.
Thank you. Staying with you, Phoevos, I know we discussed what the all-in sustaining costs of Karo is on the one slide, but what we did not maybe highlight in detail is how long should it take to get Karo to first production?
On the current timeline, and as Michael mentioned, assuming the funding comes in in Q1 of the next calendar year, we anticipate putting first ore in mill in Q1 2027, so some 15 months or so from now. Okay. Just a high-level question for you, Phoevos, staying with you. The existing shape buyback, I know we mentioned that we had roughly 87% complete. Is there an update on whether this will be extended?
At this stage, when considering the capital for the next year with the underground development as well as the Karo commitments, we elected at the board to continue with the dividend and pause till this buyback is complete. We'll reconsider it at the half year again, dependent on performance, production, and commodity prices.
Thank you. Switching over to you, Michael, in the interim to give Phoevos a break. Can you talk about the dividend policy? Is there still a policy of paying out a minimum 15% of net profit after tax? I think this relates to what you explained earlier with regards to the write-up of the $67 million versus where we should be standing. I guess it also applies to previous years where we could have potentially paid a little bit more of normal tax and had the royalty been applied the way it should have been.
Sure. The board at the moment hasn't changed its dividend policy. So the dividend policy stands at 15% of consolidated net profit after tax. I mean, it's reviewed at both the half year and the year-end period. It really depends on where you are, as Phoevos mentioned earlier, on commodity prices, your results, and where the capital expenditure program is going. But we have consistently committed ourselves to capital discipline. That capital discipline includes returning funds to shareholders as we proceed. So there's been no change at this point in time.
Thank you. Michael, staying with you, I have a question here with regards to the bond that has been extended. The question relates to why was there an increase in the interest rate payable on this bond?
That was painful. It went from 9.5% to 11%. There was a lot of negotiation around it.
What it really boils down to is the shortage of dollar liquidity in Zimbabwe itself. While the external funders were still happy at the 9.5% and thereabouts, within Zimbabwe itself, we had significant investors from them. I think they're strategic going forward. We have to build relationships with them and the conference with them. If you looked at their cost of funding, the best we would be able to negotiate was at that 11% that we got away with. In summary, shortage of dollars in Zimbabwe, and also from a Zimbabwean perspective, a 3-year investment is a relatively long-term investment from a banking perspective. Very appreciative of the continued commitment, and this was, unfortunately, one of the giveaways that we had to do to ensure we got it across the line.
Fantastic. Thank you. Phoevos, question for you. One is more direct.
We obviously saw the announcement last week by the Zimbabwean government of potentially changing the royalty rate with regards to gold from 5% to 10%. How do we see that impacting on Karo? That ties in with a sort of high-level question with regards to how are you finding working in Zimbabwe? Are you confident in the sustainability and reliability of the jurisdiction? Maybe highlight the fiscal work we've done in Zim.
Yeah, thank you. I think it's a very important question to answer. As you may know, the government of Zimbabwe are shareholders in the Karo Platinum Project at some 15%, and they're fully aligned with the strategic imperative and the investment of this project.
To that end, we've had a number of agreements over the years with the government and investment framework agreement, thereafter special economic zone status, which was later revoked for mining companies. The process that we followed was to enshrine those provisions in a special mining lease. We're pleased to report that we've made great progress in terms of agreement on that special mining lease. Part of the agreement there is fiscal stability, and it's key in terms of securing our debt funding as well as strategic investment and gold streaming. Part of what we, with the government, are trying to ensure is enshrined in that document is fiscal stability and provisions that allow the bankability of this project over a period of time.
We do know that the current economic environment in Zimbabwe is challenging, as Michael mentioned, with a lack of foreign currency or USD in this case, and the ZWG conversion being one of the major challenges for operators in country. I think from a fiscal stability provision, we are trying to protect our investment as well as future stability through the provisions we are negotiating, and we believe we will be finalizing in short order. In terms of operating in country, it is a very pleasing experience. We have a highly skilled labor force, very effective, very efficient, diligent environment. You can see by the quality of the site and the cleanliness as well as the safety record that it really is a highly productive environment.
We look forward to moving beyond these short-term challenges and getting into steady-state production and ensuring that sustainability that I think all stakeholders are aligned on.
Thank you. Michael, quick one for you. Good morning. Can you please elaborate on the Bank of China Forex Trade Facility? If applicable, what is the maturity and coupon for this loan?
Sure. I'll just quickly scan through so I can refresh myself on the interest rate on it. It is a 3-year facility. It has a bulletary payment, and I'll just pop back to you afterwards on the interest rate to give you the exact answer on that.
Thank you. Michael, maybe sticking with you, there was a question here. Could you reiterate Karo financing timelines and milestones that were to mention senior debt will likely roll over into the new year?
I'm assuming that simply relates to the Christmas period coming up when we need to finalize documents and credit committees.
Correct. I think where we are at the moment is we've got the last requirement from the lenders, which was the technical report that has been circulated. They're now needing to finalize their packages for credit committee. I mean, it has gone through a process. They haven't gone blind up to this stage, getting the necessary approvals. I’m expecting the new year we'll get to credit and then start the drafting of those particular documents as we go forward. If everything's aligned, I'd look at towards the end of the first quarter of the next calendar year. What we do, however, have to remember is that we do need to have a fully funded package for the lenders to draw down the senior debt facilities.
There are two work streams we're working on there. The one is strategic investor, and that is progressing well. In parallel, we're doing a gold stream. Gold streams are notoriously expensive as far as I'm concerned, but it's also not a bad time if we look at the commodity pricing to properly entertain a gold stream that would fund that shortfall. In the interim, we at Tharisa are still committed to providing ongoing funding to the project in this intervening period.
I'll give you a breather. Let me ask this question to Phoevos before I get back to you. How's your cost structure exposed to PGM and chrome metal prices? Do you have part of costs directly tied in with the metal prices? I think it's just a high-level question on our costs.
Yeah. I think we pride ourselves in being in the lowest cost quartile, and you can see that clearly illustrated when you look at the all-in sustaining costs that Michael ran through in terms of PGMs. Our co-product business model has proved resilient through the cyclicality of both chrome and PGM markets and prices. We do focus on our costs, and it is down to the unit costs. The more productive we are, the lower the cost per unit. We strive continuously to manage those costs and reduce them through efficiencies. That is where our innovative approach and optimization kicks in, where we look at recovering more of the metal that we mine. I always say that we spend a huge amount of cost, effort, time, and energy to extract one cube of rock from our open pit, a finite resource.
We might as well maximize the amount of opportunity and metal we can get out of that cube, hence us reprocessing continuously through the various stages, be it Voyager, Challenger, Genesis, and Vulcan, Vulcan X, to extract that maximum value. It is one area where I think we are very focused on and manage. We are obviously subject to the macroeconomics of commodity prices, and we cannot control those, but we certainly can control our cost structure and efficiencies.
Thank you.
Before you answer, I can give you the answer on the cost of that funding. For the senior debt and the term note, I just want to make sure I was correct that they both are the same interest rate. It is the South African JIBAR + 220 basis points. Of course, that will change to ZARONIA in the new year once that is implemented.
It is a ZAR-based facility. It's not a dollar facility.
Thank you. Thank you. Phoevos, I'm going to split the one question here into two because it relates to sort of the CapEx that we're going to be spending over the next decade and how much we still need to spend at Karo and what the timing of it is. There is a question here relating to the $547 million where that is being spent. I guess how much do we need to spend at Karo to get to full production? I'll let you answer that one.
Yeah. I think if you look at the numbers holistically, they look daunting.
Over a continuous period, if we look at the $547 million over a 10-year period, it's not too dissimilar to what we're spending in terms of replacement cost of our yellow mining fleet over the previous decade. You look at the deferred stripping capitalized asset. As we transition, yes, there will be a double-up of both staying in business in the open pit as well as the development costs. It generates a peak funding of $173 million. I think that's the key number to take away over the decade for us to transition to underground. Now, when we move to Karo, the balance is just over $300 million that needs to be invested to complete the full project there.
One has to remember that we're putting in infrastructure, water, power, campsites, reticulation around the mine that survives well beyond the 10-year life of the first phase of the open pit. It is capital-intensive upfront, but you're really enabling the ability to continue mining and processing for 60 years. That's really where the conviction comes in into the underlying fundamentals around platinum group metals, their unique nature, the constraints around new supply, dwindling capacity, as well as what we believe is a very positive outlook for new demand drivers for platinum group metals. We've got to look at it strategically and understand that these are not short-term, quarter-to-quarter investments, and they are measured in decades.
When you look at it on that basis, the numbers look large, but stretched out over a period of time, they are appropriate for the scale of the resources that we have under our control.
Thank you. Michael, quick question for you here on the capital expenditure, Tharisa Mine, actual versus planned. And I guess if you have a sort of holistic number of what we still need to spend at Karo in terms of dollar terms, I know we showed on the financing slide, but maybe sort of delve into that.
Sure. I think I saw one of the questions come up here about the large-scale projects and the CapEx that we have going forward. I think Phoevos has touched on a key point, is that on the transition to underground, while the CapEx is $547 million, that is over a 10-year period.
The peak funding requirement is about $173 million because of the quick access to the reef itself. The plant and all the rest has already been built, the infrastructure is in place and so forth for that. The question is, are we comfortable with the large-scale projects, the capital size required based on a market capitalization? I think we have proved ourselves over the years to be or to manage our capital and our capital spend. If you look at the strength of our balance sheet, yes, we're leveraging it for growth now, but it will not be over-leveraged as we go forward in terms of, I suppose, comparable metrics. Yes, I'm comfortable with where it goes. You always have to bear in mind that commodity prices move up and down, and we'll, of course, take advantage of those cycles as well.
In terms of capital spend for the 25-year, substantially in line, except for the deferred stripping, which was probably behind where I expected it to be. We had a higher number budgeted for that work, but we're already accessing those reef horizons. Going forward for this next year, I would expect that capital expenditure on deferred stripping to be significantly higher than the $9.8 million, but also not as high as the prior periods, $65 million as we continue with that stripping and access those reef horizons. I think that may have answered that question here. Yep. Absolutely.
Thank you. I'm sticking with you, Michael. Last question before you can hand back to Phoevos to close off. It's with regards, I guess, the question in the mining industry generally is sort of cost inflationary pressures.
What guidance have we got for cash cost per ton mil given we were roughly at $60? I think it's more about what the increases could be than the actual number and what pressures we are seeing or not seeing.
Sure. I think if we look at the cost pressures coming through, I mean, diesel is very well. It's a big expenditure of ours from a power generation point of view. I think we can all see that in the market. It's really stabilized. I don't see much cost pressure increases coming from there. Eskom needed for the mills. Unfortunately, they seem to continue to require above-inflation increases. On the labor front, we have a wage agreement with our unions, which is largely inflation-linked. I do not see much cost pressure increases coming through from there.
Overall, except for probably the electricity side, I'd probably be looking at inflation-type increases. Just north of 3% is what I would expect in dollar terms.
Thank you. Phoevos?
Yeah. Great. Thank you all for your time this morning. We really are proud of what we've achieved at Tharisa, and we are excited about the next five years and 10 years beyond that, where we'll be able to deliver on these very exciting projects: the Tharisa underground, the Karo Platinum Mine hitting steady-state production, as well as commercializing our Redox Flow battery, our PGM beneficiation strategy, as well as our chrome alloy downstream endeavors and initiatives. With that, I'd like to thank you for your time and wish you all a wonderful day further.
That's great.
Thank you for updating investors today. Could I please ask investors not to close the session?
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