South Africa Diversified Metals & Mining: 1H’26 earnings previews mixed (stronger rand a key drag); cost guidance/project updates likely focus

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South Africa Diversified Metals & Mining: 1H’26 earnings previews mixed (stronger rand a key drag); cost guidance/project updates likely focus

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22 Jul 2026 11:30:00 ET │ 28 pages

South Africa Diversified Metals &

Mining

1H’26 earnings previews mixed (stronger rand a key drag); cost

guidance/project updates likely focus Ephrem Ravi AC +44-20-7986-2462

ephrem.ravi@citi.com

CITI'S TAKE

Shashi Shekhar, CFA AC

Our earnings expectations going into 1H’FY26 results for SA diversified +91-22-4277-5028

miners are mixed with ARI, TGA and EXX likely seeing higher EBITDA y/y due shashi.shekhar@citi.com

to higher PGM/thermal coal pricing, while KIO should see lower earnings

due to lower US$ realized iron ore prices (FOB). We flag that headwinds from Krishan M Agarwal

stronger rand and higher operational costs are well embedded into market +44-020-7986-4092

expectations. Sector balance sheets remain strong, and companies are krishan.agarwal@citi.com

likely to stick to their dividend policies (mixed div payment expectations).

Investor focus is likely to be on: 1) operational guidance (particularly on

operating costs/capex given higher crude oil prices), 2) projects - Bokoni,

Two Rivers, Berg copper (ARI), UHDMS (KIO) and renewable projects (EXX),

3) dividends, and 4) commentary around rail performance. In this note, we

update our estimates, change our TP with unchanged ratings. We remain

buyers of ARI, EXX and TGA (details inside).

ARI: FY26 earnings preview — We expect the company to report group EBITDA of

ZAR10.2bn (+60% y/y) and HEPS of ZAR20.5/sh (+49% y/y; VA consensus:

ZAR22.1/sh). Production is likely to be broadly in line with the guidance exceTP for

PGMs (lower than expected production at Modikwa). We expect a final dividend of