Good afternoon
Our yearly Zurich Australian Resources Conference is getting close - next Friday in the Hotel Baur au Lac.
If you are interested, please find registration details, and the itinery under:
https://www.schroeder-equities.com/conference
You will notice, that there have been changes! I am very sad, that the new Boss of Panoramic Resources cannot make it ( as a shareholder, I am happy for him to stay in Australia, though, as he has just too many things on his plate currently ) . Victor will follow up with a roadshow to Zurich before the summer. The same applies to Osino Resources, and unfortunately, now also to Sheffield Resources ( is the MD in the final stages of a deal??? ). Sheffield was too late to be replaced - Panoramic and Osino have been replaced by Oklo Resources and Chalice Gold - I think they are both very aedequate replacements and had been on my personal short-list before! We will adjust the itinery, which you find under the link, as soon as we find time to do so….
Statistics are a wonderful thing…China moved to calculate new virus infections in a different way, substantially increasing the numbers. But new infections are actually still falling in terms of absolute numbers…so I am not too worried here!
Boris Johnson had a big argument with the “finance minister”, who resigned abruptly…the Footsie is pretty weak.
Markets had a good run and might be using the above for some profit-taking - not too bad really, equities are down a little, bonds are up a little, metals are stronger - incl gold , which is up a few$ again to about 1577,50 US or 2343 A$. Interesting - equity markets in Europe were quite weak in the morning, to recover with US futures - but gold continues to go better.
The US$ has broken a strong resistance level to the Euro and is now looking to test the old highs, about 4% above todays level. Unusual, that this does not seem to bother the metals incl gold!
Palladium and Platinum never really saw a big correction and are holding at very high levels. Iron ore, which should be a good indiactor for what´s happening in China ( given that 70% or so of the world´s imports are going there ) has actually had a reasonable run lately. That ahs been helped by heavy rain in Brazil, but also a cyclone in Australia. It remains to be seen, for how long iron ore can hold above 80$ in light of the growth contraction of China. I guess if the virus situation calms down in the current Quarter, the i pact ( incl stimulus in China ) might not be all that bad. But I think we will have to watch carefully here - but probably, there is no reason for becoming just too cautious.
Australia could be hit the most by the current, virus-induced slowdown. First we have had the drought, then fire, now we have the virus…but even in Australia, I doubt whether the impact will be more than 0,5% of GDP-growth.
Liontown - a sensational resource upgrade today! From 74.9 millt of LI2O at 1,3% to 139 Millt at 1,33% - exceeding the upper end of the exploration target of 25-50 mill additional tons by 15 millt!!! Cathleen valley was an excellent resource before - it´s truly worldclass now - and it´s not finished! 5 drill rigs are currently drilling, and a final resource estimate will be announced some time in March. This will then be used as basis for the final feasibility study. The muted market reaction - albeit on excellent turnover - shows us again, that the mood for lithium stocks has probably bottomed, but is still bad. The market valuation of LTR is just 16% of the valuation of the Kidman resource, in the takeover last year. LTR are very well managed, and they do not spend money, where they should not, as TimGoyder ( Chairman ) and Craig Williams ( board member and a bit of a legend ) control nearly 220 mill shares between them or nearly 19% of the company. I would be surprised, if we saw any corporate action here too soon - but if you believe in the future of EV´s, this is an asset the big boys cannot ignore. As a shareholder, one is in very capable and safe hands here, and one can wait for the big thing to happen - whenever it happens, it will make you probably 3x your money…Just listen to their presentation in Zurich, 21st of Feb! Even at the end of the current, extremely active Quarter they will have 5 Mill cash left, which might be sufficient for the feasibility study - but I think it is on the tight side. It should not be hard to riase 5- or 10 mill$ for this company, though! he size is large enough for intos these days, and the project is surely exciting!
West African - what we suspected, is now official: The Sanbrado Mine will produce it´s first gold early in the 2nd Quarter, 3 month ahead of schedule! That´s fantastic! Everything is going extremely well, and parts of the plant ( crusher ) have already been comissioned. There is absolutely no reason to believe, that something is going wrong here - but the proove is in the pudding, and I think we will see another rerating of the stock by mid-year. I think the drivers now are: First production results, and perhaps even more important, deep drilling results any time from the end of March on ( I guess ). I had to sell a little bit of stock today - purely for risk management reasons - but WAF remains my currently largest holding. I am waiting for 80ct!
Newcrest - result out today…no major surprises. The stock continues to be a lot more expensive than the very well managed, Australian top stocks like Evolution, Northern Star or Saracen…so I can still find absolutely no reason to own them! Of interest is, that they want to spend 25 mill US$ ( ! ) in exploration on Haverion, the JV with Greatland Gold in the Paterson Province, next to Telfer, trying to replace production at Telfer from existing reserves, which are running out in 2 years time. Greatland had a big run this year so far, from under 2p to nearly 5p…Perhaps time to revisit Antipa Minerals? Remember, they are the ones in JV with RIO , and various other land holdings in the Paterson Province. Since the discovery of RIO´s Winu 18 month or so ago, it has become pretty quiet about the area.
Osino Resources - my little Canadian investment is going from strength to strength! After raising 14 mill A$ recently in a very sought-after placement, the stock never looked back! There is a lot of smart money backing this one, and a recent field-trip just after INDABA has raised fresh attention. Not dirt cheap, if you compare what tehy already have with stocks like Oklo or Tietto - but large potential, and that´s what the North American market likes. Drilling will start again in a few weeks time, and for the first time in it´s history, Osino can actually drill as much as they want. It should be a defining year for them. As you know, I have a personal interest here.
Have a nice eveing
WS
Schröder Equities GmbH
Seitzstr.7a
80538 München
Tel. +49-89-4613440-0
Fax +49-89-4613440-10
email: wschroeder@schroeder-equities.com
website: www.schroeder-equities.com
eingetragen im HR München, HRB 166985
Geschäftsführer: Wilhelm Schröder
The information contained in this communication is confidential and is intended only for the use of the addressee. Unauthorised use, disclosure or copying is strictly prohibited. If you have received this communication in error, please delete it and notify us by telephone at +49-89-4613440-0, by fax at +49-89-4613440-10 or by e-mail at wschroeder@schroeder-equities.com immediately. Please note that this communication does not constitute and may not be construed as investment advice and / or referral to buy or sell financial instruments. Unless specified otherwise, the views expressed in this communication are solely subjective notions of the individual sender and / or the entity or individual stated as the author of any information submitted. Performance in the past may in no case be considered as an indication for future performance. Please also note that Schröder Equities GmbH and / or its officers or employees may have interests in financial instruments referred to this communication. A current list of shareholdings can be emailed on request. Furthermore, our clients are hereby informed that Schröder Equities GmbH renders advisory services to Nestor Australien Fonds, an investment fund administered by Nestor Investment Management S.A. Luxemburg. Please also note that e-mails can be intercepted by