Resources

Resources equity research

Explore the latest equity research and media content for companies in the Resources sector. These stocks operate in mining, industrial metals, paper mills and forestry. Mining sectors include coal, diamonds, and gemstones/precious metals.

Resources equity research

16 May 18

Electrifying flight**

Electrifying aviation motivated by cost-saving potential and environmental implications – whilst electrification is profoundly impacting the automotive industry, there is a growing case for electrification in the aerospace industry. 40% aggregate powertrain energy cost saving potential, combined with clean sky initiatives is driving expanding research and investment across the sector. Rising urbanisation is creating congestion solutions focusing on electric Vertical Take-off and Landing (eVTOL) innovate technologies.

Companies: ABM AMC AAZ JAY bmn GEO KOD MKA PGM SOLG URU

16 May 18

Finishing unfinished business

On 2 May Pan African (PAF) announced that, after both internal and external reviews had concluded there was “no realistic prospect of mining [Evander 8 Shaft underground] on a sustainable and profitable basis”, the decision had been taken to shut the operation by the end of May, with the loss of 1,700 jobs and at a cost of c ZAR160m (US$13.1m, or £9.5m). As a result, Evander’s (EGM’s) gold production for FY18 is now expected to be c 46koz vs a prior expectation of 67-69koz, while group production is expected to be 156-158koz vs a prior expectation of 177-181koz.

Companies: Pan African Resources

09 May 18

To raise or not to raise that is the question?

The MPC faces this dilemma on Thursday. Just a few weeks ago, the decision appeared straightforward. Since, the outcome has become less obvious. A slew of weak economic indicators, not least a slowing of UK Q1 GDP growth to 0.1% point to this conclusion. Markets have rallied, due in part to renewed sterling weakness. We have also seen further M&A activity, especially in the FTSE 100 which may extend to smaller companies, in due course. The results marathon is slowing. In Share News & Views, we comment on Advanced Oncotherapy* Bloomsbury, Cronin*, OnTheMarket* and Synectics*.

Companies: APC BMS CRON CRPR ECSC ESC EUSP FDM GETB PCF SNX SPRP TCN W7L

21 Feb 18

Some signs of stability return

Since our last missive, we have continued to experience volatility but there have been some signs recently of increasing stabilisation, although some nervousness clearly still persists. We have a Spring Statement from the Chancellor of Exchequer on 13 March where he will respond to the forecasts from the Office for Budget Responsibility. We have the prospect of a rise in interest rates in the short run, with further increases likely over the medium term with negative implications for ‘defensives’. In Share News & Views, we comment on Hargreaves Services, RWS Holdings, Staffline and Synectics*.

Companies: APC BMS CRPR ECSC EUSP FDM GETB PCF SNX SPRP TCN W7L

01 Apr 18

AIM Journal

Two former AIM companies could be in the FTSE 100 index in the near future following the successful bids by Melrose Industries for GKN and GVC for Ladbrokes Coral. Melrose has been on the brink of the FTSE 100 for a while and if a constituent company of the FTSE 100 is acquired than it can be replaced by the acquirer when it is eligible. Melrose is already on the reserve list for inclusion in the FTSE 100, following the March 2018 quarterly review.

Companies: PTSG JDG TRCS SRB TAP KETL

11 May 18

50% resource increase at Mina do Barroso

The significant increase in compliant resource at their near surface Mina do Barroso hard rock lithium project in Portugal is very good news indeed. This spodumene resource is now probably Western Europe’s largest and totals 14 million tonnes (Mt) grading 1.1% lithium oxide (Li₂O), 7.2 Mt in the indicated category and 6.7 Mt in the inferred. Both resources grade 1.1% Li₂O and a 0.5% Li₂O cut off was used.

Companies: Savannah Resources

18 May 18

Despite pricing relief, cash burn continues; now hope(s) pinned on H2

Even after pricing improvements (excluding platinum), the group continues to report losses and burn cash. Although some normalisation could get underway (H2 FY18 onwards), the performance is likely to remain capped as platinum prospects look gloomy. The only major relief can come post a successful merger with Sibanye-Stillwater, but here again brewing uncertainties/difficulties at Sibanye create an unsettled air.

Companies: Lonmin

12 Sep 17

Tailings

We take another look at lithium, where there is a growing realisation that the forecast massive increase in demand is already upon us. This realisation has been matched by an awareness that there is no shortage of lithium in geological terms. However, there is still a considerable degree of ignorance about which types of lithium mineralisation are commercially valuable using current processes and technologies; this will require the development and proving of new processes. In this note, we look at what attributes are required for a lithium-bearing deposit to be attractive for development into a successful mine in the present technical and economic environment.

Companies: APF ACP ATYM BKY CAML FDI GEMD HZM PAF PDL SAV SHG WTI WLFE ASO

26 Oct 17

Good Q3 production numbers leads to full year guidance upgrade

Q3 production numbers for the Kazakh copper miner were good and as a result they have upgraded full year production guidance to 250-270,000 tonnes (t) from 225-260,000 t. They also introduce a gold target of 160- 180,000 ounces for 2017.

Companies: Kaz Minerals

26 Feb 18

LIBERUM: Sylvania Platinum - Extracting more value

Project Echo and the Phoenix Platinum acquisition (now renamed Lesedi) are quickly proving to be solid value additions to the company. We recently visited several sites, which has raised our degree of confidence on project delivery, as such we have raised our production volume assumptions to 76koz from 69koz per annum from FY19 onwards.

Companies: Sylvania Platinum

14 Mar 18

LIBERUM: Asiamet Resources* - $10m raise funds increase in Beutong stake & exploration

Asiamet yesterday raised $10m at 11p per share which will be spent to exercise options to increase its stake in the large Beutong copper porphyry (3.1mt Cu equiv. @ 0.62% Cu equiv) to 80% and continue drilling on both the KSK and Beutong licenses. The company has a number of likely catalysts in the next six months including; the release of the BKM bankable feasibility study and potential sell down of a minority stake in the KSK license to help finance development, a maiden resource at BKZ and testing lateral and depth extensions of mineralisation at Beutong and BKZ/M.

Companies: ASIAMET RESOURCES

04 Apr 18

The Monthly

This month’s feature article is the first publication of the 2017 global pharmaceutical industry statistics from which the global and US rankings of the top 15 drug companies are derived. Comparisons are made with historical data to show how different company strategies have evolved. In addition, an analysis of the evolution of biopharmaceuical drugs has been made, together with a key sub-set, namely drugs derived from antibody technology, which now represent 12% of the entire market. Two more drugs joined the $100bn club in 2017.

Companies: OPM ABZA AVO AGY APH ARBB AVCT BNO BUR CMH CLIG COS DNL EVG GTLY GDR INL KOOV MCL MUR NSF OBT OXB NIPT PHP RE/ REDX SCLP SCE SIXH TRX TON VAL

10 Apr 18

Healthy results, but optimism seems overdone

Driven by across the board price tailwinds, Anglo American has achieved its best operating profits since 2013. Consequently, net debt reduced significantly (-41% vs. 2016-end). However, higher unit costs and sombre production levels in 2018 are likely to cap further gains and an earnings correction should get underway (2019 onwards) as prices revert to normalised levels. Remember, the recent earnings improvements were to a great extent driven by coal and iron ore – where the markets remain vulnerable.

Companies: Anglo American

24 Apr 18

Small Cap Breakfast

Rosenblatt Group -specialist litigation and contentious restructuring law firm established in 1989 based in the City of London. Offer TBC. Due 8 May. Supreme, a leading manufacturer and supplier of branded consumer batteries, a manufacturer and supplier of branded and licensed consumer lighting and a leading manufacturer and supplier of vaping products in the United Kingdom, is looking to join AIM. Offer TBC, expected early May 2018 KRM22, a closed-ended investment company with a particular focus on risk management in capital markets, is looking to join AIM. Offer tbc, expected 30 April 2018 Serinus Energy -international upstream oil and gas exploration and production company. Its principal assets are located in Romania (development phase) and Tunisia (production phase). Raising c.£10m. Offer TBA. Due mid May.

Companies: SAR VIS CORA DUKE TERN INSP REDX FAL COIN

01 May 18

Expansion on track, a gold mine with purpose

FY17 saw Caledonia Mining (CMCL) marginally beat its 54-56koz gold production guidance, drive down AISC costs, its head grade increase (which had a corresponding positive effect on gold recoveries) and add significantly to its code-compliant resource base. In relation to its investment plan to lift production to 80koz by 2021, we see capex peaking this financial year (FY18), which will then allow significantly improved free cash flow generation. Coupled with an improved political environment and regulatory changes seemingly favouring gold miners (with a key objective of improving Zimbabwe’s domestic US$ currency supply), Caledonia is very well placed to capitalise on the long-overdue opening up of one of Africa’s prime geological and mining gems.

Companies: Caledonia Mining Corporation Plc Com Shs Npv

10 May 18

Avesoro Resources - Q1 Update

21 May 18

Greatland Gold - Black Hills: Multiple Gold Zones Identified

09 Aug 17

Bushveld Minerals - Vametco operational update

09 May 18

Horizonte Minerals - Vermelho Mineral Resource

01 May 18

Base Resources: Overview

10 Apr 18

Ariana Resources PLC - Tavsan Resource update

09 May 18

Greatland Gold - Ernest Giles: Mobile Metal Ion Sampling Results

04 Apr 18

Serabi Gold - Subscription & Funding update

23 Apr 18

Kodal Minerals - An overview

21 Mar 18

Bitesize briefing - Auriant Mining

15 May 18

Eurasia Mining - Update From West Kytlim

13 Mar 18

Ariana Resources - 2018 Production Guidance

26 Apr 18

Serabi Gold - Operational Review of First Quarter 2018

07 Mar 18

Horizonte Minerals - Company Update

13 Mar 18

Greatland Gold - Interim Results

Latest Content

Polarean Imaging Sunrise Resources

Northland Capital Partners Limited Morning Report

POLAREAN IMAGINING (POLX.L) | SUNRISE RESOURCES (SRES.L)

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22 May 18
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JAY bmn SGZ

SP Angel – Morning View

Arc Minerals (ARCM LN) – Ann Gloag, founder of Stagecoach, takes 3% stake following consolidation of Zamsort stage | Bluejay Mining* (JAY LN) STRONG BUY – Target Price 45p – 100mt of high-grade titanium mineral sand targeted at Iterlak in summer work program | Bushveld Minerals* (BMNLN) BUY - Target 25p – Imaloto Power Project concession agreement with government of | Madagascar Scotgold Resources* (SGZ LN) BUY – 61p (from 58p) – Cononish funded to production

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22 May 18
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Greatland Gold

Greatland Gold - Black Hills: Multiple Gold Zones Identified

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21 May 18

AFHP AOR GTLY ARE UVEN GAN PGD CNC TOOP

Small Cap Breakfast

Block Energy— UK based oil exploration and production company whose main country of operation is the Republic of Georgia. Raising £4m. Mkt cap £9.3m. Due early June. Codemasters Group— video game developer and publisher, specialising in high quality racing games. Offer TBA. Seeking £15m in primary. Due 1 June. Strongbow Exploration (TSX:SBW) intends to dual list on AIM. Holds rights to the South Crofty underground tin mine, a former producing tin mine located in the towns of Pool and Camborne, Cornwall . The project is estimated to require the Company to raise £25 million over the next 18 months to progress to a production decision. Offer TBS. Due June. Maestrano Group, a software company with operations in Australia (main country of operation), the UK, US and the UAE, is looking to join AIM. Offer TBC, expected late May. Yew Grove REIT—newly formed Company will pursue its investment objective by investing in a diversified portfolio of Irish commercial property. Offer TBA. Due Late May Team17 Group -video games label and creative partner for independent developers. 2017 revenues of £29.6m and Adjusted EBITDA of £12.9m. Raising £45.1m primary and £62.5m secondary at 165p. Mkt Cap £216.6m. Expected 23 May 2018 Serinus Energy -international upstream oil and gas exploration and production company. Its principal assets are located in Romania (development phase) and Tunisia (production phase). Raising c.£10m at 15p. Due 18 May. Mkt cap £32.6m

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21 May 18
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KOD MKA PGM SGZ SOLG

SP Angel – Morning View

Kodal Minerals* (KOD LN) - Drilling extends mineralisation to over 1km at Sogola-Baoule | Mkango Resources* (MKA LN – Definitive agreement with Talaxis | Phoenix Global Mining* (PGM LN) – Final results Investment by a major mining company in Idaho | Scotgold Resources (SGZ LN) – Cononish development funding secured | SolGold* (SOLG LN) – Exploration success in southern Ecuador

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21 May 18
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Motif Bio Altona Energy

Northland Capital Partners Limited Morning Report

MOTIF BIO (MTFB.L) | ALTONA ENERGY (ANR.L)

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18 May 18
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Deutsche Rohstoff

Increase in production and asset monetisation

Deutsche Rohstoff’s (DRAG’s) multi-asset and resource strategy has been built around management’s ability to identify investment opportunities, development of prospects and ultimately monetisation. In 2017 the group delivered a 497% increase in revenue, and 472% in EBITDA driven by increased production, boosted by a full year contribution from DRAG’s 90% owned affiliate Salt Creek Oil & Gas. Subsequently, in April 2018 Salt Creek Oil & Gas signed a sale and purchase agreement with Northern Oil & Gas to divest most of its acreage in Williston Basin, generating a c 40% return on invested capital over 17 months. Management expects a strong increase in production over Q218 and Q318 as investment made in Elster Oil & Gas yields results.

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18 May 18
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Lonmin

Despite pricing relief, cash burn continues; now hope(s) pinned on H2

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18 May 18
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Triton Minerals

Termination of coverage

Edison Investment Research is terminating coverage on Triton Minerals (TON). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant.

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