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Hmmm. If one cannot see the merit in an investment into a battery metal focused royalty company that's largely sheltered from the huge inflationary pressures that operators/developers are struggling with in this space then maybe the space isn't for them. Capex and opex numbers are going through the roof for most miners or wannabe miners.
Appreciate that APF has lagged somewhat - but there's obvious reasons for that if one was to do an inch of due diligence. Royalty companies will outperform over the longer term. The last decade was a rapid growth story for the precious metals royalty players, and now it'll be the time for the diversified focused co's to shine.
Olderandwiser....... Have a word with Berenberg who has just increased their target price to 180. You might become even wiser.
Dividend in the last year was 9p.
I'm not sure that looking at an arbitary prior timespan neccasarily reflects the prospects of a company going forward. For the earlier half of 21 the commodities that apf is biased towards were not really in a bull market imo. I've held here for quite a while, and pretty happy with how I've done and the current outlook.
Met coal @ $360/t today.
a safe 7% is fantastic and a non-exec just bought £1.67m worth
Prescient is the word - there is a lot in the 'pipeline'
I'm struggling to see the outstanding merits of an investment in APF, tbh.
Yes, there is a dividend of circa 7p, gross, but for capital gains, every year, there are none, going back as far as 2017, unless you were a prescient market timer. In a commodity bull market like we had in 2021, isn't this a disappointment?
Hi CaneToad, q3 was an all time record quarter, but it won't be for long.. of that I'm fairly certain. Agree @ q4 paying at the highest rate at kestrel, but crucially it was also significantly above the highest rate threshhold for most of the quarter and still is now(you only get the 15% on the portion above the higher threshhold). We don't yet know how much was produced.. but assuming it was inline with expectations, happy days. One thing that worries me slightly is the possibility of steel production in china slowing what with winter olympics and covid.. but on the whole I can't see prices declining too much as things stand. I think this would be higher now if it were not for JT's selling.
@dusty42: From what I can see, almost all of the Kestrel production should have been at 15% royalty for the past 6m.
Given that Kestrel makes the biggest contribution and that coal is rising again, this looks encouraging for the Q4 update. Surely they must be making record profits. Then there's Voisey's Bay, which is starting to become significant.
Hi CaneToad, I've tried to calculate/estimate the numbers for the kestrel royalty in the past, it's difficult as it's not clear what prices are realised at the mine. We can see the FOB price but rail transport costs are a bit unknown. Suffice to say with regard to met coal, I'm fairly confident this q will see record income, assuming production quantities are inline with expectations. This royalty pays very well when prices are high.
Then there's the cobalt stream, short history.. but given where cobalt price have been and are now, this will also make a very decent contribution.
@ cherryburn - indeed, pretty happy with where prices are for the start of 2022.. and also hopefully some income from around May from Piaui.
JT: "I don't think the market understands yet how significant the rise in coking coal and cobalt prices are for the company," Treger said."
That's what Revenue Guidance is for... He shouldn't blame the market. Anyone able to make a stab at the implications? I expect it's not trivial as there's some gearing that comes into play.
Hang on, I've just clocked that I miss read your response. 90% again in 2022 would be awesome!
Thanks for the response Cacher. Yes I knew they were expecting 90% this year, but had no idea about 2022. To be honest 60% could/should still see it making a very healthy contribution to income at apf if prices stay anywhere near where they are now. My hope would be that that figure also be weighted toward the first half of the year.
Hi Dusty. From what I understand, 90% of 2022 production at kestrel will be on APF royalty land. That drops to 60% in 2023.
Hi Casher, yes some income from Piauí starting in May would indeed be good news. I wonder if a decision has been made on the upsizing option there, hence the presentation tomorrow? Though may be a bit early for that I guess.
Do you(or anyone else) have any idea how much mining at kestrel is likely to still be in the royalty area next year?
Some good information too in the video link below. The Brazilian Nickel CEO talks about smaller scale nickel production from Piaui by mid next year. That'll be a huge plus for APF when that particular operation gets into production.
Will be interesting to see what's discussed tomorrow..
https://youtu.be/bBeXQ4J-o6w
I missed this.
https://www.proactiveinvestors.co.uk/companies/news/968061/anglo-pacific-group-projects-are-now-75-battery-metals-focussed-968061.html
"I don't think the market understands yet how significant the rise in coking coal and cobalt prices are for the company," Treger said.
I am confused as to why the surname of the cfo got starred out in my below post!
Bit of a pickup here towards the end of the day.. unbridled excitment over mr ***** talking tomorrow? Or just a slow awakening to some good q4 results in the pipeline? Met coal back over $300/t and cobalt sneaking upwards.