Adam Davidson, CEO of Trident Royalties, discusses offtake milestones and catalysts to boost FY24. Watch the video here.
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Thanks. not aware of rock rule!! you having a laugh
I just watched this Rule Syposium intererview recorded 19 hours ago:
https://youtube.com/watch?v=Y53-X8WGbmU&si=ZdT7Ae5uJiqaVLIe
I have been a holder of TRR for sometime but was unaware that Rick Rule is a shareholder and has invited TRR to present at his famous conference in Boca Ratan in July. If you aren’t aware of Rick Rule he is a highly successful investor in commodities and remains a large shareholder in Sprott where he worked. Many of the legends of the Commodities industry attend his conference. It is for me a great endorsement of TRR that Rick Rule has invested.
Buy recommendation from Simon Thompson:
“ A discounted smart way to play precious metals
This commodity royalty group is trading on a near-50 per cent discount to un-risked net asset value
May 7, 2024
by Simon Thompson
Royalty and offtake revenue up 21 per cent to $9.5mn
Pre-tax profit of $3.8mn reverses prior year loss of $4.6mn
Buoyed by profits on disposals, gains on asset revaluations and a higher royalty and offtake income, commodity royalty group Trident Royalties (TRR:36p) moved back into profit last year.
The sale of pre-production gold royalties to mining giant Franco-Nevada Corporation (CA:FNV) realised $15.8mn of cash proceeds, representing a 143 per cent return on capital, and highlights the value Trident is creating for shareholders.
Moreover, management continues to develop its gold offtake portfolio, holding offtake contracts over 10 mines, which accounted for almost three-quarters of group revenue in 2023. Since the year-end, Trident has announced positive news on two projects in the top-tier gold mining jurisdiction of Ontario, Canada.”
There is a lot more and this is the concluding part:
“ Well-funded
In February 2024, Trident entered a new $40mn revolving credit facility with an option to increase it to $60mn. The interest rate is SOFR (the replacement for Libor) plus a margin of 2.5-4.5 per cent (depending on leverage ratios), resulting in annual interest savings of $1.3mn once fully drawn.
Trident has net debt of $22mn, a sum equating to 20 per cent of shareholders’ funds, so it has ample headroom to fund new investments. Furthermore, the increasing royalty income is generating bumper operating cash flow, so much so that Tamesis estimates net debt will fall to $10.5mn by the year-end.
True, the 80 per cent decline in the LCE price in the past 18 months has dented investor sentiment. This is the key reason why the share price has pulled back to my entry point (Alpha Research: 'A lowly rated commodity and green energy inflation hedge’, 1 November 2021) even though 12 of the group’s 21 assets are now producing cash flow including a valuable gold offtake portfolio valued by Tamesis at $78.9mn (21.2p). Rated on a 50 per cent discount to unrisked NAV estimates, Trident shares are worth buying.”
The full article is available on the IC website.
Agreed MS. Threats of nationalisation very rarely end up as such. Yes, weve occasionally seen it happen, but more often than not the government (in this case the Mali Gov) realise that the mining industry and exploitation of their natural resources (funded by foreign capital) is too important to the national economy, and simply choose to take a slightly bigger slice of the pie than before. Its a story that we've seen play out across South American nations and now in Africa.
Thought that was good news regarding Anson today.
TRR Own a % of whats in the ground not the mine. so who ever owns the mine,which is as of today B2B. a huge mining company. If they sold it or the military government took the mine over. TRR still owns a % of in ground gold etc for ever. It only cost £3 million and was a banker for the future as its a Royalty etc over exploration ground. IMO only & DYOR.
All of TRR in production Gold mining assets are bringing in cash and are in diversified locations. most in North & South America and owned by large mining company's.
But what if the Malian Govt simply expropriate B2 Golds mine?
This risk to me eas simply glossed over in their report accompanying the full year results.
They made a big statement as to why they invested in this royalty without giving any sense of what will happen if the government seize B2Golds assets
They can buy 10/30% of the mine. Doesn't affect the royalty payment.
Out for now. Back later. Q1 will be a blinder!
Gold infographic…
https://www.visualcapitalist.com/visualizing-global-gold-production-in-2023/
Trek
That's another 5% annual return looking secure.
I'm a bit concerned about the Mali situation. It seems possible that the government will take over B2G's new mine. If so, does TRR's royalty stream become worthless?
RNS link won’t open here…..
“ Trident Royalties Plc (AIM: TRR, OTC: TDTRF), the diversified mining royalty company, will announce its Q1 2024 Activities Update on Tuesday 7 May 2024 at 07.00 BST.”
https://www.londonstockexchange.com/news-article/TRR/notice-of-q1-2024-activities-update/16446195
Trek
Should get q1 activities update next week , prob Thursday. If not defo following week.
Usual caveats
Trek
Copper futures over $10k/ton
$13m income this year, costs are a million or so. Gold and copper price helping.
I hope they spend it soon, but if they feel the need to start making dividend payments it would help the share price.
These purchases are hardly worth it
Revolving credit facilities. Seen it all before . It’s all a red getting . Be careful here
Here’s a chart!
https://www.visualcapitalist.com/u-s-debt-interest-payments-reach-1-trillion/
Phew!
Trek
I see MS is still as passive aggressive as ever.
Trek it's a fair question but comes from an idiot.
Why would they raise when they have $19M in cash? Unless it's a value accretive deal the board would not countenance it. 10p no chance.
In terms of Cash Flows they appear to have been marginally negative when taking into account the previous fully drawn loan interest payments, but now appear to be positive based on increased revenues and the lower interest cost on the new facility. Will see if YE 2023 reflects this but reality is we are not going to see that properly reflected until 2024 first half is reported. Q2 will also have 2 additional revenue streams added in a gold offtake and silver surface material processed which then starts a 12 month countdown of an $8.75M milestone payment. So basically nobody need worry about cash.
Would be nice of a new deal announcement soon, we have been treated to and have become used to lots of deal announcements, so through 2023 and 2022 but so far 2024 has been quiet.
‘ How is the cash flow here...?’
I don’t understand the context of the question. Aren’t you supposed to DYOR before considering an investment.
Trek
Trek. I added more this morning.