Jubilee Platinum Plc - Potential Mining Giant

Jubilee Platinum

Key Data
EPIC JLP
Share price 62.25p
Spread 62p - 64p
NMS 5000
Market cap. 48.8 million pounds
12 month range 42.75p - 98.25p
Market AIM
Website www.jubileeplatinum.com
Sector Mining Exploration
Contact CEO Colin Bird
0207 584 2155


The resource sector has suffered a poor month but exciting developments in South Africa have meant that Jubilee's share have slipped by just 1p to 63p. Against a more benign market backdrop the newsflow from this company would, we believe, have prompted a more significant re-rating.

The first announcement came on December 6th – Jubilee's shares are to gain a dual listing on the Johannesburg Stock Exchange. We believe that the quality of mining stocks on the JSE is far greater than that of the stocks on AIM and that this dual listing will be positive for the company.

Thereafter Jubilee announced that it had bought an additional 13% stake in the Tjate project from its BE partner for ZAR $65 million and had an option to buy another 15% for ZAR 75 million. This shareholding is held by Jubilee's wholly owned South African subsidiary Windsor . It was subsequently announced that Mitsubishi, the Japanese conglomerate, is to invest $16 million in Windsor via convertible loan notes paying no interest. This deal effectively funds the increase of Jubilee's stake in Tjate to 63% although Mitsubishi is likely to convert its notes into 20% of Windsor 's share capital. The net effect would therefore be to increase Jubilee's stake in Tjate to a net 49% at no cost to itself.

On the ground progress towards completing a pre-feasibility study at Tjate continues. Work also continues in Madagascar and has not been affected by recent political uncertainty in the country. With net cash of 5.7 million pounds and two joint venture partners funding most of the work in Madagascar , there is nothing holding back further aggressive exploration work over the coming months. Our initial valuation of Jubilee when we initiated coverage in December 2004, at 27.25p, was 126p per share but in January 2006 we increased that valuation to 216p per share.