Zimplats Q1 FY2026: 6% Drop in Metal Concentrate, 21% Cost Surge
Zimplats delivered steady mined and milled volumes in Q1 FY2026 with improved safety performance and significant cost increases. Major capital projects remain on track despite operational challenges.
- Zero lost-time injuries recorded, reflecting improved safety
- Mined volumes stable year-on-year with slight 1% decline quarter-on-quarter
- 6E metal concentrate production down 6% quarter-on-quarter
- Operating costs rose 21% due to labour, maintenance, and equipment expenses
- Major projects including Mupani Mine and smelter expansion progressing on schedule
Safety and Production Overview
Zimplats Holdings Limited reported a solid safety performance for the quarter ended 30 September 2025, achieving zero lost-time injuries. This milestone underscores the company’s ongoing commitment to safe production practices and its aspiration to reach zero harm across its operations.
On the production front, mined volumes experienced a marginal 1% decline from the previous quarter but remained stable compared to the same period last year. The slight dip was primarily due to ore depletion in the Rukodzi Mine’s high-grade pillar and lower-grade tonnage from South Mupani. Underground mining volumes held steady, while open pit volumes aligned with the mine design expectations.
Processing and Metal Output
Milled volumes were consistent both quarter-on-quarter and year-on-year, but the quality of ore processed saw a small decline. Concentrator recoveries were negatively impacted by lower 6E head grades and inconsistent ore supply, resulting in a 6% decrease in metal concentrate production compared to the prior quarter. Final metal production was down 24%, compounded by an extended furnace repair period and an accumulation of concentrate inventory, which will be processed in the coming months.
Rising Costs and Financial Implications
Operating costs surged by 21% quarter-on-quarter, driven by higher labour costs following employee earnings adjustments, increased maintenance activities including mill relines, and expanded smelter operations. Power costs were partially offset by the commissioning of a solar plant in August 2024. Despite the cost pressures, cash operating cost per ounce of 6E metal increased by 30% compared to the previous quarter, reflecting the combined impact of lower production volumes and higher expenses.
Capital Projects Progress
Zimplats continues to advance several major capital projects critical to its long-term growth. The Mupani Mine development, intended to replace the depleted Rukodzi and Ngwarati mines, remains on schedule to reach full production of 3.6 million tonnes per annum by FY2029, with US$352 million spent against a US$386 million budget to date. The smelter expansion and SO2 abatement plant project is also progressing well, with US$461 million invested out of a US$544 million budget.
Renewable energy initiatives are underway, including the Phase 2A 45MW solar plant, complementing the already commissioned 35MW Phase 1A plant. Additionally, the Selous Metallurgical Complex is seeing ongoing investment with tailings storage facility extensions and base metal refinery refurbishments advancing as planned.
Exploration and Outlook
Exploration activities paused this quarter to focus on validating assay results from prior drilling, with new drilling expected to commence in the second quarter of FY2026. The company’s strategic investments in exploration and infrastructure signal confidence in its resource base and operational future despite near-term production and cost challenges.
Bottom Line?
Zimplats’ steady production and safety gains are tempered by rising costs and inventory build-up, setting the stage for a critical operational and financial balancing act ahead.
Questions in the middle?
- How will Zimplats manage rising operating costs while maintaining production targets?
- What is the timeline for processing the accumulated concentrate inventory and its impact on future output?
- How will ongoing capital projects influence the company’s cost structure and production capacity in the medium term?
