Investment company Mantengu Mining has reported a wider comprehensive loss of R42.8-million for the six months ended August 31, compared with a R3-million profit in the comparable six months of 2024.

Despite the group’s gross profit having increased to almost R70-million, compared with R53-million in the prior period, the company experienced higher one-off operating costs in the period under review.

Mantengu has undergone a massive growth phase and is effectively still at the start of its investment journey.

The group listed in August 2022 but had to complete a rights issue and share consolidation in March 2023 to correct some of the legacy issues created owing to a reverse takeover process.

This meant that Mantengu could only actively trade from April 2023 onwards.

The company has recorded significant growth in its balance sheet since then, specifically in terms of net asset value, which increased to R482-million in the six months under review, compared with R135-million in the prior comparable six months.

Following investments made in August and December last year, as well as February and August this year, Mantengu now owns 100% of Meerust Chrome, 100% of Sublime Technologies, 100% of Iron Production Plant and 70% of Blue Ridge Platinum.

The group’s primary focus is on expediting the development and build phases of all its investments as it continues to ramp up each operating asset to steady state.

In respect of the six months under review, Mantengu explains that significant flooding was experienced early in the 2025 calendar year, which had a negative impact on revenue and net profit before tax of about R51-million and R40-million, respectively, owing to lower production volumes in Mantengu’s chrome operations.

Staff costs and machinery costs remained fixed during this period of lower production.

“The one positive aspect to arise out of this flooding was that we have collected and stored enormous volumes of water such that our chrome operations have not had to use municipal water for the half-year, a notable outcome considering that chrome beneficiation is a water-intensive process,” the company states.

The company suffered another negative impact on revenue and net profit of R29-million in the period, owing to the Langpan operation’s offtaker, RWE Supply and Trading, having exercised an outright purchase option to buy chrome concentrate at a lower price compared to market prices during the months of May to July.

Mantengu explains that a “perfect storm” of market conditions prevailed to give rise to this option in chrome prices decreasing and increasing drastically within a very short period. This is not expected to recur in future.

Moreover, the Blue Ridge Platinum operation was consolidated into the group from August 1 following the receipt of a Section 11 Ministerial approval.

The inclusion of Blue Ridge resulted in a negative impact of R8-million on the group’s net profit, with R3-million relating to operating costs for the month of August and R5-million relating to consolidation entries because of Blue Ridge being accounted for as an asset acquisition as opposed to a business combination.

The group will continue to incur R3-million of operating costs monthly until Blue Ridge starts production, which is expected in the first half of the 2026 calendar year.

Meanwhile, Mantengu has secured an offtake agreement for the supply of chrome concentrate with Monteagle International UK at a minimum of 300 000 t, or 10 000 t a month.

The product will be a 40% to 42% chrome concentrate and will be sold on a cost, insurance and freight basis using the published market price by FerroAlloyNet.com.

Blue Ridge Platinum expects that deliveries will start during the first half of 2026 once the company has completed construction of a new chrome plant.

Mantengu explains that infrastructure expenditure that was not capitalised but expensed had a negative impact of R16-million on its net profit, with the expenditure having related to future-proofing both its chrome operations from any potential future flooding.

Looking ahead, the company expects the Langpan chrome operation to continue with steady-state production after the flooding, with hot commissioning of a second chrome wash plant being imminent. This will significantly bolster Langpan’s production of chrome concentrate.

Production at the Meerust operation is also increasing, with Mantengu introducing a second chrome wash plant on site to boost production.

Mantengu remains focused on ramping up all operations in the shortest possible timeframes, such that it can reduce expansionary capital expenditure and start delivering returns to shareholders.