Under pressure H1, but better than Rusal

Despite expected weakness in the Metals segment (evident in Rusal’s results), EN+ reported somewhat better – although still weak – H1 results. Power provided a valuable cushion with this segment’s standalone deleveraging also helping to reduce the group-level obligations. While the challenges in Metals may take a bit longer to subside (completely), EN+ has reliable support from the Power segment. Overall, a well-balanced business proposition but one that continues to be disregarded by the market

Weak 2022 results, but survival instinct remains intact

Although En+’s 2022 results were weaker than expected, they were far from a complete disaster. Besides aluminium’s post-war gains (albeit capped due to cost challenges), the firm’s power proposition was an added advantage. While it is difficult to predict a normalisation calendar for En+ (and other Russian miners), it remains a critical natural resources/energy firm and, hence, should sooner or later see its underlying virtues being acknowledged by markets.

Strong H1 results, despite serious geo-political risks

En+ has reported strong H1 results, with healthy contributions from both segments – where pricing dynamics were very strong. Although, the impact of disrupted upstream operations in Aluminium was evident. Nevertheless, the fact that the firm’s geographic sales exposure to western markets was ‘largely’ steady, despite serious geo-political risks, was a promising signal. Overall, despite near-term price normalisation risks, given the promising long-term focus market dynamics, En+ remains an attrac

Exceptional 2021 results; various uncertainties ahead, but partly-cushioned by energy proposition

On the back of promising focus markets, En+ reported impressive 2021 results. Deleveraging momentum was sustained. With market dynamics becoming even more favourable, after the Ukraine-Russia war outbreak, the firm should have benefited in a big way. However, considering the challenges/risks due to En+’s Russian lineage, the way forward remains uncertain. Although ownership of domestically-focused energy division is a valued cushion. Add on top the indirect stake in Nornickel (via Rusal), En+ re

A multi-faceted green proxy

With aluminium on course to re-attain its past glory, hydropower demand and, hence, pricing witnessing strong and sustainable tailwinds, and Nornickel remaining a fortified proposition, En+ is set for a major re-rating. Even though re-emerging COVID-19 risks have rekindled some macro risks, the firm remains a beneficiary of near sacrosanct / less vulnerable focus market fundamentals. Hence, we initiate coverage with a ‘BUY’ recommendation.

Jubilee Metals - Operational Update Q3 FY2024

Jubilee today reports its Q3 and third quarter operational results from its expanding operations in Zambia (copper) and South Africa (chrome and PGM). South Africa is on a growth trajectory with record chrome production of 409kt in the quarter (Q2 FY2024 381kt) and a monthly record in March of 145kt and production YTD of 1.13Mt (0.94Mt). Jubilee is well underway to its annual target capacity of 2,1Mt/yr especially with the new 300kt/yr chrome plant at Thutse expected to be operational in August

Trinity Exploration and Production - Reserves Reduction but Solid Core Business

Trinity has announced a c28% reduction to its 2P reserves following a YE23 review. Despite the decrease in the Company’s 2P reserves, Trinity’s core business remains robust, with a reserves/production ratio of >12.5 years at YE23. Whilst there is significant potential for growth within the current portfolio, this will be difficult to unlock from the current balance sheet and we believe further financing will be required. We update our target price to 76p (from 202p), a c85% premium to the curren

Morning Note – 16 April 2024

Valeura Energy (TSX: VLE): Three exploration wells deliver three discoveries

• The Nong Yao-13 exploration well in the new Nong Yao D area that was targeting multiple zones has encountered >30 feet of new oil play across several new shallow intervals which have not been produced elsewhere on the concession. These reservoirs are believed to be recurring across the Nong Yao D area. • The drilling result confirms that oil has successfully migrated into this area of the block (a factor that was seen to be a risk in the Nong Yao D area) and open the opportunity for further a

I3 Energy (I3E LN) - Canada royalty assets sale

I3 has announced the sale of the majority of its royalty interests in Canada, for US$24.8m cash. This allows the company to fully repay amounts drawn on its debt facility and create a working capital surplus, giving I3 significant additional funding flexibility going forward

NextSource Materials - Initiation

NextSource is uniquely positioned to build a leading vertically integrated position, ex China, in the supply of Lithium-ion battery anode material which is essential for the Energy Transition. The company is commissioning phase 1 of its world-class Molo graphite mine in Madagascar and is in the final permitting process for its first Battery Anode Facility (BAF) to be located in Mauritius. The company is backed by Vision Blue, established by Sir Mick Davis, former CEO of Xstrata. On our calculat

Morning Note – 15 April 2024

DEC FY23 Results Update

DEC reported FY23 results which were in line with expectations and announced the acquisition of joint venture assets from Oaktree along with an updated capital allocation framework.

Oil & Gas - Cavendish sector note

Chariot, Energean, Touchstone Exploration, Longboat Energy, Hartshead Resources, BP, Helix Exploration, PetroTal, Pantheon Resources, Caspian Sunrise, Petrofac, DNO ASA, Valeura Energy, Aker BP, Var Energi Source: FactSet, weekly change 08/04/24-12/04/24 Oil rose as Israel braced for a possible attack from Iran, a development that would threaten major disruptions in a region that accounts for a third of the world’s crude output. An assault is expected to come as soon as the next 48 hours, which

Union Jack Oil (UJO LN) - Wressle update

Union Jack has released an update on its Wressle asset, reporting maturing production from Wressle-1, alongside progress for significant further development activities on the field going forward.

SP Angel . Morning View . Copper prices hold higher as China processing fees fall below $0/t amid low feedstock availability

PROGRESSIVE: Pharos Energy: Delivering on operations and balance sheet

Pharos Energy reported FY23 results on 27 March. Group net production of 6,508 boepd (FY22: 7,166 boepd) was in line with guidance, assisted by successful development drilling in Vietnam and exploration successes in Egypt. Pharos’s strong cash generation resulted in a stronger balance sheet, with net debt reduced to US$6.6m (from US$28.9m at the end of 2022) and cash balances totalling US$32.6m. This left the group free to return more cash to shareholders, including a 10% increase in dividends,

Union Jack Oil+ (UJO, House Stock at 23p) - Wressle update

Hunting (HTG LN) - Q1 2024 trading update

Hunting has released its Q1 trading statement, reporting a strong period for OCTG and Subsea, steady growth in Advanced Manufacturing, and a softening in Perforating Systems.

Union Jack Oil* (UJO LN) - Wressle update and dividend plans

Union Jack announced an operational update on its onshore UK Wressle field and confirmed plans to announce the payment of a cash dividend to shareholders along with the FY23 results in May. Wressle continues to deliver material revenues to the Company, generating positive cash flow and providing it with sufficient cash resources to fund shareholder returns and invest in new development projects.