JSE-listed Thungela says it is confident that it will achieve about 13.7-million tonnes of export saleable production for the financial year to end December 31 – exceeding its guidance range of 12.8-million to 13.6-million tonnes.

This comes as the production profile in South Africa transitions, with the closure of Goedehoop and the successful ramp-up of Annea Colliery – previously known as the Elders project – as well as the handover of the Zibulo North Shaft project to the operation.

The company, in a pre-close statement for the financial year, says production momentum has also benefitted from consistent rail performance and improvements by State-owned Transnet Freight Rail (TFR), with an annualised 56.6-million-ton run-rate for the industry for the period ended November 30.

The company says this reflects an improvement of 9% on the 51.9-million tonnes delivered in 2024.

Thungela notes that, at its interim results in August, it reported that in Australia, Thungela had mined through more challenging geology at Ensham during the first half of the year, which impacted on qualities and resulted in a higher stockpile of lower-quality run-of-mine coal.

“Our marketing team in Dubai successfully secured contracts for the lower-quality coal, which has resulted in improved sales and lower stockpiles.

“Accordingly, we expect to report export saleable production of 3.8-million tonnes at Ensham, which is within the guidance range of between 3.7-million and 4.1-million tonnes,” the company says.

Meanwhile, Thungela says global economic activity remains uncertain and influenced by the effects of tariffs and persistent volatility surrounding international trade.

The company says these factors, such as inflationary pressures, global economic sentiment and financial market volatility, continue to weigh on overall growth.

The impact of the stronger South African rand is also affecting the competitiveness of South African exports.

Seaborne thermal coal prices remain depressed on the back of weak demand, caused mainly by the uncertainty around the impact of tariffs and lower gas prices, while the supply discipline that was expected, has not yet fully materialised.

Additionally, demand from China and India, the largest importers of thermal coal, remained below expectations for most of the year, as a result of increasing domestic production and support for the growth of alternative energy sources.

Thungela says Indian steelmakers faced growing competition from lower-cost imported steel, which, in turn, reduced demand for South African coal and further impacted on prices.

Moreover, increased gas and nuclear power generation in Japan, Korea and Taiwan further curtailed coal demand, which contributed to Newcastle coal prices recording a four-year low of about $90/t in September.

Following these low coal prices across South Africa and Australia, Thungela says it has observed initial restocking at major import hubs and a gradual recovery in sentiment as reflected in the forward price curves which are now in contango into 2026 and 2027.

Thungela says benchmark coal prices have weakened this year, with the Richards Bay Benchmark coal price averaging $89.63/t for the year-to-date, compared with $105.30/t for the prior financial year.

The Newcastle Benchmark coal price has averaged $105.11/t for the year-to-date, compared with $134.85/t in the prior year.

Thungela says export saleable production relating to its South African operations is expected to be about 13.7-million tonnes, compared with the 13.6-million tonnes produced in the prior financial year.

It says this reflects the continued ramp-up at Annea and a strong performance at the Mafube colliery, offset by lower volumes from Khwezela, which was impacted by abnormally high rainfall in the first half of the year.

The company notes that the free-on-board (FOB) cost per export tonne, excluding royalties, for South Africa for this year is expected to be below the guidance range of between R1 210/t and R1 290/t, mainly owing to a non-cash rehabilitation adjustment and strong production performance.

The FOB cost per export tonne including royalties is also expected to be below the guidance range of R1 220/t to R1 300/t.

Additionally, Thungela notes that export saleable production at Ensham for this year is expected to be about 3.8-million tonnes – on a 100% basis – compared with the 4.1-million tonnes produced in the prior financial year

The lower expected export saleable production for this year is mainly owing to more challenging geology experienced in the first half of the year.

FOB cost per export tonne, excluding royalties, at Ensham for this year is expected to be within the guidance range of between R1 470/t and R1 580/t.

Including royalties, the FOB cost per export tonne is also expected to be in the lower half of the guidance range of R1 650/t to R1 780/t.

CAPEX

Thungela adds that capital expenditure (capex) for its South African operations for this year is expected to be about R2.6-billion.

This consists of R1.4-billion relating to sustaining capital, which is at the lower end of the guidance range of between R1.4-billion and R1.7-billion, and expansionary capital of R1.2-billion relating mainly to the Elders and Zibulo North Shaft projects, which is at the upper end of the guidance range of between R1.1-billion and R1.2-billion.

Sustaining capex at Ensham for this year is expected to be about R650-million – on a 100% basis – which is marginally below the guidance range of between R700-million and R950-million – on a 100% basis.

Thungela says the group has continued to invest through the cycle, which is demonstrated by the completion of the Elders project, as well as the progress made on the Zibulo North Shaft project.

The Elders life extension project was completed this year for R1.8-billion and the company says it expects total aggregate expansionary capex of R2.5-billion for the Zibulo North Shaft life extension project by the end of the year.

The balance of R100-million will be spent in the first half of 2026.

The company says it has made good progress at the Lephalale Coal Bed Methane project and has started to receive some of the major equipment, such as the first generator, while the liquefied natural gas (LNG) plant is expected to be received by the end of the year.

The civil works and the water treatment plant are also complete.

Thungela states that it remains confident in the long-term fundamentals of the coal market, recognising its role in the energy mix in support of global energy demand.

“Together with a structural supply shortfall from underinvestment in new mines and the depletion of existing supply, this remains a driver for longer-term price support for high-quality thermal coal.”

Thungela expects to release its annual results on or about March 23, 2026.