SP Angel – Morning View – Friday 28 09 18
Steelmaking materials hit two month lows on abandoned blanket curbs
MiFID II exempt information – see disclaimer below
Amur Minerals (AMC LN) – Interim Results
Bushveld Minerals* (BMN LN) – Bushveld confirms compliant BEE stake in Vametco
Cradle Arc (CRA LN) - Interims highlight work to improve copper production in Botswana
Cora Gold* (CORA LN) – Interims
Georgian Mining* (GEO LN) – Interims show careful cash control as company awaits license renewal
IronRidge Resources* (IRR LN) – Financial results 2018
KEFI Minerals* (KEFI LN) – Interims
Scotgold Resources* (SGZ LN) – Annual results
SolGold* (SOLG LN) – Annual Report
Strategic Minerals Plc* (SML LN) - US$2.4m value addition through Leigh Creek Copper Mine acquisition
Steelmaking materials hit two month lows on abandoned blanket curbs
- Coking coal and rebar prices pull back to two-month lows in China on speculation production might ramp up in coming months as Beijing dropped blanket output cuts for winter.
- Beijing is taking a more flexible approach to controlling regional hazardous emissions allowing local authorities to apply curbs on a case by case basis.
- "Because the government is moving away from the 'one size fits all' approach and into a more specific and targeted approach, the market interpreted this message as a loosening strategy in terms of production cuts during the winter heating season period," CRU consultancy commented on the new.
- Most actively traded rebar contract on the SFE was trading at the lowest since end of July while the construction steel product was on course for eh first monthly drop in six.
- Local steelmakers suspended some 17.5mt of capacity last year.
- There is going to be a relatively muted period for bulk commodities as Chinese markets shut down for the National Day holiday on Oct 1-5.
Electric Fuel to Present 24V High Energy Density Marine Lithium Ion Battery at IBEX 2018 Show
- Electric Fuel will launch a new 24V high energy density lithium ion marine battery at the IBEX 2018 Show.
- The new battery is designed for electric boat propulsion and for yachts and engine-propelled boat backup power. The battery can be integrated into newly designed boats or used as a drop-in replacement for traditional lead-acid in various marine and professional vehicle applications.
- Electric Fuel's 24V lithium marine battery offers high energy and power density, with three times the energy of a similar lead-acid battery. The 24V battery pack is a standard sized G49 and can serve a wide range of professional applications in tough marine environments where reliable and clean energy is needed.
Aboitiz Power buys Ayala’s coal projects for $579.2m
- Aboitiz Power Corp. acquired a 49% voting interest and 60% economic stake in AA Thermal Inc. for $579.2m, the two companies said Friday.
- The sale involves around 500 megawatts of coal capacity out of AC Energy Inc.’s total 1,300-MW coal platform.
- “Aboitiz Power is committed to addressing the country’s energy trilemma of adequate supply, cost of power and protection of the environment. This is part of our strategy to reach our 4,000-MW net attributable capacity by 2020 through our balanced mix strategy.” Aboitiz Power chief operating officer Emmanuel Rubio said.
Shangahi Future Exchange closed for holiday next week
- The Shanghai Futures Exchange will close for a week after regular daytime trading ends on Friday as China enters an extended vacation period that covers its National Day holiday on Oct. 1.
- We expect metals markets to be more muted as trading volumes diminish from the principal commodity consumer
|
Dow Jones Industrials |
+0.21% |
at |
26,440 | |
|
Nikkei 225 |
+1.36% |
at |
24,120 | |
|
HK Hang Seng |
-0.02% |
at |
27,711 | |
|
Shanghai Composite |
+1.06% |
at |
2,821 | |
|
FTSE 350 Mining |
+0.50% |
at |
17,712 | |
|
AIM Basic Resources |
-0.92% |
at |
2,203 |
Economics
Currencies
US$1.1619/eur vs 1.1706/eur yesterday Yen 113.45/$ vs 112.68/$ SAr 14.154/$ vs 14.177/$ $1.307/gbp vs $1.314/gbp 0.722/aud vs 0.723/aud CNY 6.885/$ vs 6.875/$
Commodity News
Precious metals:
Gold US$1,183/oz vs US$1,195/oz yesterday
Gold ETFs 67.6moz vs US$67.6moz yesterday
Platinum US$810/oz vs US$826/oz yesterday
Palladium US$1,086/oz vs US$1,075/oz yesterday
Silver US$14.30/oz vs US$14.39/oz yesterday
Base metals:
Copper US$ 6,212/t vsUS$6,234/t yesterday
Aluminium US$ 2,029/t vs US$2,047/t yesterday
Nickel US$ 12,670/t vs US$12,700/t yesterday
Zinc US$ 2,545/t vs US$2,517/t yesterday
Lead US$ 2,016/t vs US$1,984/t yesterday
Tin US$ 18,875/t vs US$19,015/t yesterday
Energy:
Oil US$81.8/bbl vs US$82.2/bbl yesterday
Natural Gas US$3.052/mmbtu vs US$2.969/mmbtu yesterday
Uranium US$27.45/lb vs US$27.45/lb yesterday
Bulk:
Iron ore 62% Fe spot (cfr Tianjin) US$67.9/t vs US$68.4/t
Chinese steel rebar 25mm US$688.8/t vs US$689.8/t
Thermal coal (1st year forward cif ARA) US$97.3/t vs US$98.2/t
Coking coal futures Dalian Exchange US$193.3/t vs US$192.7/t
Other:
Cobalt LME 3m US$62,250/t vs US$62,250/t
- Marquee Resources managing director Charles Thomas says; 'Having returned from our Asian roadshow and having met with a number of Chinese enterprises, we are extremely encouraged by the strength of the Chinese demand for high-quality cobalt projects with low deleterious elements.’
China NdPr Rare Earth Oxide US$46,843/t vs US$46,910/t
China Lithium carbonate 99% US$10,313/t vs US$10,328/t
Tungsten APT European US$275-290/mtu vs US$275-290/mtu
Company News
Amur Minerals (AMC LN) 4.4p, Mkt cap £29.7m – Interim Results
- Amur Minerals announced the completion of a minerals resource updates resulting in a resource of 155mt with nickel equivalent grade of 1.02%, containing over 1.5mt nickel equivalent tonnes.
- By the end of August the Company completed over 26,000m, with drilling targeting three priority objectives for the 2018 season, while secondary targets are now being drilled:
- To establish the final data set for allowance of reporting Russian reserves, allowing the Company to obtain mining production approvals from the Russian Federation and local agencies;
- To convert a large high-grade block of Inferred resource for inclusion in the Mining Ore Reserve and move forward into an earlier period of the production schedules;
- To acquire a large metallurgical sample to define the variability and content of the life of mine sulphide concentrate for either toll smelter and or Low-Grade Matte generation.
- It is envisaged that once the 2018 field season has been completed, the Company’s focus will turn predominantly to corporate development.
- The Company entered into a convertible loan facility of up to $10m in February 2018, with an initial advance of $4m being drawn at the time the facility was entered into, to support the ongoing 2018 drill programme. As of June 2018, 17.5m new ordinary shares have been issued by the Company in settlement of $1m of principal and accrued interest. As at reporting date the balance of the loan, net issue costs, stood at $2.4m.
- The Company recorded a $3.6m loss in H1/18 (H1/17: $2.0m) including $1.1m in overhead costs.
- Cash balance stood at $3.4m (FY17: $3.6), with a $2.4m convertible loan.
*SP Angel act as Nomad and Broker to Amur Minerals
Bushveld Minerals* (BMN LN) 30.3p, mkt cap £336.0m – Bushveld confirms compliant BEE stake in Vametco
BUY - Target Price adjusted to 34p
(Bushveld Minerals now hold 74% of Vametco)
- Bushveld Minerals report the conclusion of a transaction to raise the BEE stake in the Vametco business to a fully compliant 26% holding from 25% previously.
- Raising the stake reduces Bushveld’s stake in Vametco to 74% for which Bushveld receive ZAR1.78m to be repaid from future dividends payable to the BEE shareholders.
*SP Angel act as Nomad and broker to Bushveld Minerals. The analyst has visited the Vametco process plant and associated mining operations.
Cradle Arc (CRA LN) 1.7p, mkt cap £4.6m - Interims highlight work to improve copper production in Botswana
- Cradle Arc interims show
- Production restarted in the Mowana mine in April this year with three mining units now in operation with a 12-month Rampling up program planned for the process plant starting in June.
- A new JORC resource of 55mt grading a very respectable 1.17% containing some 640,000t of copper shows a significant 37% increase over the previous issued resource.
- The team have cleaned up the company and its balance sheet through the sale and joint venture of assets in Burkina Faso and Mali as well as agreement to redeem a £2.4m convertible loan note.
- The interims only capture relatively small sales from the commissioning and ramp-up of production from April to end-June.
- Sales of £1.5m of copper were offset by relatively high unit costs through the commissioning.
- Other substantial administrative costs of £2.3m combine with a other losses of £1.8m and other finance costs of £0.9m to record a total loss of £5.5m though £1.8m of this is attributable to non-controlling interests.
- While pre-commissioning costs were capitalised other admin costs are taken in full in the accounts effectively inflating this number beyond the normal running costs of the company.
- We note the accountants use a relatively modest $2.70/lb copper price assumption in their going concern calculations, though they do warn that risk remains in relation to the repayment of a £1.275m loan note principal amount due in December and a $10m loan note which matures in April next year. Some of this will need to be refinanced on the $2.70/lb copper price assumption and depending on the company meeting its expected copper production targets.
- The depreciation of the South African rand has dragged back the value of the Botswana’s Pula which is a connected currency and should help out from a cost perspective.
- Copper prices have risen recently back above $6,000/t with significant price appreciation expected by many on rising demand for electric vehicles and related infrastructure.
Conclusion: The team are working toward the instillation of a DMS ‘dense media separation’ plant at Mowana which should transform the economics of the mine and plant though enabling the simple and low cost upgrading of ore into the plant thereby significantly increasing its capacity and productivity. Costs should fall significantly as production rates and recoveries improve. Cradle Arc has much work to do in the short term to ensure the simple availability mining equipment is able to feed the improved process plant. While this should be relatively simple it is still critical to meet the Q4 production target.
*SP Angel acts as Joint Broker to Cradle Arc plc
Cora Gold* (CORA LN) 10.4p, Mkt Cap £5.7m – Interims
- The Company completed the first drill programme across highly prospective Sanankoro and Tekeledougou properties in Mali with over 17,000m of drilling.
- The flagship Sanankoro project located on the Yanfolila Gold Belt accounted for over 13,000m of drilling before the start of the wet season in Q3/18.
- The team extended the strike and known mineralization zones as well as delineated new prospective areas forming the basis for the coming field season works potentially leading a mineral resource definition.
- Drilling results from Tekeledougou located on the door steps of the Yanfolila gold processing plant highlighted potentially economic gold zones that warrant further work.
- The team carried reconnaissance surface work across other parts of the Sanankoro Project Area in Southern Mali and the Diangounte Project Area in Eastern Senegal to prioritise targets ahead of the start of the new field season in October/November.
- The Company has renewed a number of exploration permits during the period including Madina Fulbe licence covering the ground in a highly prospective Kedougou-Kenieba Inlier running along the Mali-Senegal border.
- Commenting on results, CEO Jon Foster highlighted “2018 has been a period of substantial activity, with work programmes centred primarily on Sanankoro, where we have identified 8km of drill defined gold mineralised structures, highlighting the potential for a very large-scale gold development project”.
- The Company recorded a $0.4m loss in H1/18 (H1/17: $1.8m) including $0.4m in overhead costs.
- Cash balance stood at $1.4m (FY17: $3.5m) with the Company remaining debt free.
Conclusion: The initial field programme across the Sanankoro and Yanfolila project areas delineated a number of gold mineralised zones that warrant follow up work once wet season ends. The footprint of identified and mapped geological structures as well as numerous occurrences of artisanal mining activity across its properties point to high exploration potential of the area.
*SP Angel act as Nomad and Broker to Cora Gold
Georgian Mining* (GEO LN) 8.8p, Mkt Cap £10.0m – Interims show careful cash control as company awaits license renewal
(Georgian’s assets in Georgia are held in a 50:50 joint venture)
HOLD
- Georgian Mining report a significantly reduced loss on its exploration activities in Georgia..
- The total comprehensive loss of £393,201 vs £564,118 yoy is the result of a significant positive currency translation difference and a benefit from the non-controlling interests.
- The group reports £1,057,987 of net cash used in operations similar to last year’s expenditure.
- Cash and cash equivalents reduced to £1.4m from £4.3m yoy.
- Statements from ministers within the new Georgian government indicate a positive response to recent meetings and a keen willingness by the government to grow the mining sector. We expect Georgian Mining to have a better second half and a better year from here.
*SP Angel acts as Nomad and Broker to Georgian Mining.
IronRidge Resources* (IRR LN) 21.8p, Mkt Cap £61.3m – Financial results 2018
- IronRidge Resources announce results through June 2018 as the company advance exploration efforts across the diverse portfolio of gold, lithium, bauxite, titanium and iron ore in frontier regions of Africa and Australia. £8.25m funds raised in July 2017 supported working capital and development of the pipeline of projects, with a broad exploration focus on African holdings.
- IronRidge strengthened ground holdings in Central and West Africa:
- Joint Venture agreement with Gail Resources SARL was made unconditional in November 2017, consolidating holdings along the Kineta gold portfolio in Ivory Coast.
- Joint Venture agreement with Joy Transporters Ltd was made unconditional in April 2018, consolidating holdings along re-discovered lithium pegmatite fields in Ghana.
- Consolidation of holdings in Chad in April 2018, with the granting on Nabagay and Kalaka licences.
- The Company also acquired 100% of Tekton Minerals Ltd, transferring ownership of promising gold exploration projects in Chad, West Africa. Tekton’s management team were retained and incentivised via the issue of Performance Rights and Options.
- IronRidge announce promising results from preliminary exploration work:
- Dorothe and Echbara projects in Chad confirm significant grades and broad scale of the mineralised system from its maiden trenching programme. Trenching results from September and November 2017 include 8m @ 4.73g/t+, 12m @ 2.87g/t, 10m @ 2.98g/t, 10m @ 2.05g/t and 12m @ 2.71g/t.
- Post period-end, the Company have also announced multiple high-grade infill trenching results (August 2018) from Dorothe defining five coherent gold targets over 500m to 1.2km strike length and 100-200m widths, with targets still open along strike.
- Subsequent results in September 2018 report additional multiple high-grade gold trenching to conclude the programme at Dorothe. The results reinforce the previously reported large, coherent gold targets and defined an additional sixth high-grade, coherent gold anomaly over 900m in strike and 150m in width.
- The Company identify multiple high-priority geophysical targets to follow-up after multiple high-grade trenching results, including 65m @ 1.1% Li2O, 25m @ 1.62% Li2O and 18m @ 1.67% Li2O, and a high-resolution airmagnetics and radiometrics survey at the Ewoyaa and Abonko lithium targets, Ghana.
- Positive mineralogical characterization results confirm spodumene as the dominant lithium mineral phase in surface samples from its Ewoyaa lithium project, Ghana, allowing for a simple process flow-sheet to be envisioned. The Company commenced its maiden drill programme at the project, with broad drilling intersections announced late August 2018. Further, a new pegmatite extension through step-out drilling was identified, which occurs buried with no surface expression, increasing the prospectivity of the pegmatite field.
- IronRidge also announce in July 2018 the definition of high-priority soil anomalies at the Kineta North licence in Ivory Coast.
- Exploration is supported as the Company was granted four licences in Ivory Coast at Marahui, Vavoua South, Vavoua North and Adzope.
- Following extensive exploration programmes, the company has robust cash position of AUD8.9m (£4.9m) to continue advancing exploration to define JORC-compliant resources over the next 12 months.
*SP Angel act as nomad and broker to IronRidge Resources
KEFI Minerals* (KEFI LN) 1.9p, Mkt Cap £10.3m – Interims
- Progressing the Tulu Kapi Gold Project in Ethiopia to the development stage remained the focus on the Company during the period.
- The Company reports that it executed heads of Agreement with a local investment syndicate for a $30-35m equity injection.
- The first $9m investment is subject to completion of the remaining due diligence and execution of a binding share subscription agreement.
- The balance is subject to the final project finance package with all stakeholders now relying on closing out fo the remaining Ethiopian Government processes and approvals, along with completion of due diligence and formal documentation.
- The Company raised £5.5m over the summer (June-July) through the issue of 220m shares at 2.5p covering outstanding invoices and debt as well as providing working capital to close the funding of the project.
- The Tulu Kapi project, located in western Ethiopia is expected to produce around 140,000 oz pa of gold over 7 years at an all-in-sustaining cost of around US$800/oz.
- Net loss during the period amounted to £2.4m (H1/17: -£3.7m) comprised mostly of administration costs (-£1.6m v -£1.3m in H1/17).
- The Company had £0.5m in cash as of Jun/18 and held no debt; £2.1m of outstanding £4.8m of payables has been covered as part of the share issue in July this year.
Conclusion: The Company is progressing with bringing the full financing package together which should pave the way for the start of development works at the Tulu Kapi project.
*SP Angel act as Nomad and Broker to KEFI Minerals
Scotgold Resources* (SGZ LN) 24.0p, Mkt Cap £10.3m – Annual results
BUY – 60p (from 61p)
- FY18 (Jun YE) has seen the high grade gold/silver Cononish Project successfully securing the Planning Permission from the National Parks Authority Board.
- Additionally, the team has raised the development funding for the project paving the way for the start of construction and development works once the Decision Notice is obtained.
- The latter is expected to be completed by the end of 2018.
- In line with a phased development of the Cononish Project plan, the management provides a targeted timeline (assuming Nov/18 start):
- Phase I (December 2019 – February 2022): after a 4 month ramp up and commissioning period, the mine is expected to operate at a 3,000tpd rate;
- Phase II (March 2022 – End of life of mine): production is ramped up to 6,000tpd with incremental expansion capex covered by internal cash flows.
- Works on the ground has been focused on preparations for construction operations enabling the team to timely kick start development once Decision Notice arrives.
- Given the major operational as well as financial focus on development of the Cononish project, there has been only modest work done on other properties of the Company.
- The Company raised A$12.6m (£7m) in equity as well as securing another £5m available in loan facilities during the period which covers the £7.4m start up capex for the mine.
- Closing cash balance as of Jun/18 stood at A$11.2m (£6.2m) which does not account for a stand-by £5m loan facility; the only debt on the balance sheet is A$1.7m (£1m) owed to Nat le Roux, the Company’s non-executive Chairman and major shareholder.
- Net losses totalled A$1.9m (FY17: -A$1.3m) or EPS of -7.92cents (FY17: -8.60cents) mainly attributed to administrative costs.
Conclusion: Annual results highlight the funded status of the Cononish project with development works due to start before year end once the Decision Notice is issued. While we have slightly adjusted our earnings estimates to account for a delay in a start up of production due to a longer than anticipated permitting process, project economics remain highly attractive. Small scale Cononish project is carried by the high grade nature of the deposit with 209koz GE at 11.1g/t in mineral reserve. Life of mine TCC are estimated to average c.$500/oz (£355/oz at 1.4$/£ exchange rate) generating above industry average EBITDA margins. At full capacity the project is estimated to generate £12.5m in EBITDA and £10m in FCF (21kozpa at £965/oz gold price and ($1,350/oz and 1.4$/£ exchange rate) v current spot price of £905/oz). Latest BFS estimated post tax IRR of 77% (£920/oz gold price ($1,150/oz and 1.25$/£)).
We highlight Cononish high sensitivity to the British pound exchange rate. While the recent sell off in the gold price has been partly compensated by weakness in the British pound future reversal in the USDGBP rate may impact economics of the project. In this regard, Brexit negotiations being major catalyst for changes in the USDGBP, no deal outcome may be the preferred option given a potential knockdown effect on the exchange rate.
Nevertheless, at the moment we reiterate our BUY recommendation and target price of 60p (from 61p).
|
(Jun year end) |
|
FY16 |
FY17 |
FY18 |
FY19e |
FY20e |
FY21e |
FY22e |
|
Gold price |
US$/oz |
1,168 |
1,258 |
1,298 |
1,268 |
1,325 |
1,350 |
1,350 |
|
Gold price |
GBP/oz |
788 |
992 |
964 |
905 |
946 |
964 |
964 |
|
AUDGBP |
A$/£ |
2.04 |
1.68 |
1.74 |
1.78 |
1.78 |
1.78 |
1.78 |
|
Gold sales |
koz |
- |
- |
- |
1.0 |
10.2 |
15.8 |
18.4 |
|
TCC |
GBP/oz |
- |
- |
- |
484 |
438 |
321 |
306 |
|
Sales |
A$m |
0.0 |
0.0 |
0.3 |
1.6 |
17.2 |
27.1 |
31.6 |
|
EBITDA |
A$m |
-1.3 |
-1.1 |
-1.7 |
-1.1 |
7.5 |
16.8 |
20.2 |
|
PAT |
A$m |
-1.5 |
-1.3 |
-1.9 |
-1.9 |
5.0 |
12.6 |
12.0 |
|
Basic EPS |
A$c |
-11.8 |
-8.6 |
-7.9 |
-4.5 |
11.6 |
29.4 |
28.1 |
|
FCF |
A$m |
-2.7 |
-2.1 |
-2.0 |
-17.6 |
5.5 |
3.2 |
12.0 |
|
EV/EBITDA |
x |
- |
- |
- |
- |
3.5 |
1.6 |
1.3 |
|
PER |
x |
- |
- |
- |
- |
2.6 |
1.0 |
1.1 |
|
Source: SP Angel, Company |
*SP Angel acts as nomad and broker to Scotgold Resources
SolGold* (SOLG LN) 37.4p, Mkt Cap £634m – Annual Report
- SolGold have published their annual report today.
- The report highlights progress made and further thoughts on the remarkable Alpala project at Cascabel in Ecuador.
- The Q&A with Nick Mather, SolGold CEO is particularly interesting.
- Mather is targeting 10mt of copper and 25moz of gold in the next resource estimate, a substantial target by any standards but one that may be achieved given the scale of the Alpala resource and massive mineralised drill sections coming out of the project in Ecuador.
- Mather goes on to estimate that the resource may enable an NPV of >$4bn and an IRR of >25% for a massive 40mtpa block cave mine which would make it one of the world’s larger mining operations and put it firmly in the very special category of ‘world class’ mining projects.
- The delineation of a high-grade core at Apala should allow for a lower capital project by block caving standards starting with grades of 1.5% copper equivalent according to the Q&A.
BHP’s recent purchase of 6% of SolGold shares in the market indicates its interest in the project and suggests an intention to get more closely involved as the project moves through its feasibility studies. - But SolGold is not all about Apala. There are multiple targets to be tested within the Cascabel license area which could see Alpala as just the start of a number of new mines.
- SolGold has also been quietly working on the licensing of a number of new targets across Ecuador using knowledge gained from its work at Cascabel.
- There is still much work to do in crafting a framework financial deal with the Ecuadorian government to enable the eventual development of Alpala and other similar projects but the government appears to be keen to open up to large scale mining.
- SolGold reports a loss of A$21.5m for the year vs a profit of A$2.4m yoy.
- The very substantial ramp up in drilling activity and administrative expenses led to an operating loss of A$15.9m vs a loss of A$8.3m yoy
- The company.
- The business has cash and cash receivables of A$81.8m indicating how well funded the group is to continue its exploration activities.
- The report also describes the need for the 15% jv partner to continue to fund its share of activity at Cascabel or to be diluted according to formula as previously agreed.
Conclusion: The company looks set to continue to advance the project through PFS and onto a much more involved BFS in time supported by its new, expert shareholders at BHP, Blackrock and Newcrest who have been funding Cascabel for sometime.
*SP Angel act as UK broker to SolGold
Strategic Minerals Plc* (SML LN) 1.5p, Mkt Cap £20.7m – US$2.4m value addition through Leigh Creek Copper Mine acquisition
- Acquisition of Leigh Creek Copper Mine (“LCCM”) adds significant value, recording US$2.4m after tax profit on its purchase. The price at which the Company was able to purchase LCCM, while a fair price for its vendors, reflected the limited financial resources the vendors had available to progress the project to an operational level.
- The Company has organized a team through its wholly owned subsidiary Ebony Iron Pty Ltd. to undertake the recommissioning, with expected production in 2019, from the mine in the North Flinders Ranges in South Australia. Access to the project and cash flow is 100% controlled by the Company and holds strategic importance to create a second cash flow stream. An estimated JORC 2012 compliant Resource of 3.61mt @ 0.69% copper for 24,900 of copper metal forms the base of the project. Additional, non JORC compliant ore sources of 1.8Mt @ 0.68% copper have also been identified within existing mining leases.
- The Company’s Cobre operation also generated US$1.25m pre-tax profit, prior to intercompany management charges, and continues to underpin corporate cash flow.
- The Company negotiated with one of Cobre's major clients which, due to internal issues, had been unable to take the material required under their contract. The agreement focuses on a series of quarterly payments, placing the Company in approximately the same cash position as if the contract has been fully met.
- A resource update noting an almost doubling of the high grade Inferred Mineral Resource at Redmoor tin-tungsten project was published by Cornwall Resources Limited ("CRL") and identified the need for further drilling to expand the resource base and improve the project's economic viability. Strategic Minerals completed an investment in CRL of $107,317 to maintain the Company’s 50% interest.
- Unrestricted cash and cash equivalents at 30 June 2018 were $1.9m (31 Dec 2017: $3.7m). The reduction in cash balances reflects the acquisition of LCCM, payment of US tax liabilities and investment into CRL.
*SP Angel act as Nomad and broker to Strategic Minerals
Analysts
John Meyer – 0203 470 0490
Simon Beardsmore – 0203 470 0484
Sergey Raevskiy – 0203 470 0474
Phil Smith (Technology) – 0203 470 0475
Zac Phillips (Oil & Gas) – 0203 470 0481
Sales
Richard Parlons – 0203 470 0472
Jonathan Williams – 0203 470 0471
SP Angel
Prince Frederick House
35-39 Maddox Street London
W1S 2PP
*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)
+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.
DISCLAIMER
This note has been issued by SP Angel Corporate Finance LLP (“SP Angel”) in order to promote its investment services and is a marketing communication for the purposes of the European Markets in Financial Instruments Directive (MiFID) and FCA’s Rules. It has not been prepared in accordance with the legal requirements designed to promote the independence or objectivity of investment research and is not subject to any prohibition on dealing ahead of its dissemination.
SP Angel considers this note to be an acceptable minor non-monetary benefit as defined by the FCA which may be received without charge. In summary, this is because the content is either considered to be commissioned by SP Angel’s clients as part our advisory services to them or is short term market commentary.
While prepared in good faith and based upon sources believed to be reliable SP Angel does not make any guarantee, representation or warranty, (either express or implied), as to the factual accuracy, completeness, or sufficiency of information contained herein.
The value of investments referenced herein may go up or down and past performance is not necessarily a guide to future performance. Where investment is made in currencies other than the base currency of the investment, movements in exchange rates will have an effect on the value, either favourable or unfavourable. Securities issued in emerging markets are typically subject to greater volatility and risk of loss.
The investments discussed in this note may not be suitable for all investors and the note does not take into account the investment objectives and policies, financial position or portfolio composition of any recipient. Investors must make their own investment decisions based upon their own financial objectives, resources and appetite for risk.
This note is confidential and is being supplied to you solely for your information. It may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published in whole or in part, for any purpose. If this note has been sent to you by a party other than SPA the original contents may have been altered or comments may have been added. SP Angel is not responsible for any such amendments.
Neither the information nor the opinions expressed herein constitute, or are to be construed as, an offer or invitation or other solicitation or recommendation to buy or sell investments. Opinions and estimates included in this note are subject to change without notice. This information is for the sole use of Eligible Counterparties and Professional Customers and is not intended for Retail Clients, as defined by the rules of the Financial Conduct Authority (“FCA”).
Publication of this note does not imply future production of notes covering the same issuer(s) or subject matter.
SP Angel, its partners, officers and or employees may own or have positions in any investment(s) mentioned herein or related thereto and may, from time to time add to, or dispose of, any such investment(s).
SPA has put in place a number of measures to avoid or manage conflicts of interest with regard to the preparation and distribution of research. These include (i) physical, virtual and procedural information barriers (ii) a prohibition on personal account dealing by analysts and (iii) measures to ensure that recipients and persons wishing to access the research receive/are able to access the research at the same time.
SP Angel Corporate Finance LLP is a company registered in England and Wales with company number OC317049 and whose registered office address is Prince Frederick House, 35-39 Maddox Street, London W1S 2PP. SP Angel Corporate Finance LLP is authorised and regulated by the Financial Conduct Authority whose address is 25, The North Colonnade, Canary Wharf, London E14 5HS and is a Member of the London Stock Exchange plc.
Recommendations are based on a 12 month horizon as follows:
Buy - Expected return >15%
Hold - Expected return range -15% to +15%
Sell - Expected return < 15%
** SP Angel acts as Broker to this Company