(Alliance News) - Starvest PLC on Wednesday recorded a significant net asset value increase as investors flocked to safe haven assets amid the coronavirus pandemic.
The London-based early-stage mineral exploration investor reported an NAV of GBP18.0 million as at September 30, up substantially from GBP2.3 million in 2019, while NAV per share shot up to 31.17 pence per share from 4.03p the year before.
Starvest said the value of its trading portfolio increased over the twelve months to September 30 to GBP17.8 million from GBP1.9 million. Following a rise in market capitalisation to GBP10.4 million from GBP1.3 million, the NAV discount remained approximately constant at 42% compared to 44% year-on-year, it added.
Starvest said these increases were due to greater investor interest in perceived safe-haven assets, which led to stronger returns for the natural resources sector and for precious metals producers in particular.
"Our strategy of focusing on producers of precious metals, especially gold, benefited handsomely, as did our progress in restructuring and streamlining the portfolio investments. Many of our investee companies have appreciated substantially, leading to a portfolio value increase," it said.
Over the 12 months to September 30, Starvest said it recorded a profit of GBP15.7 million equating to a profit of 27.76p per share, with net cash inflow for the year of GBP60,198. In comparison, it made a profit of GBP386,850 in the previous year that equated to a profit of 0.70p per share.
This was driven by the disposal of its holdings in Marechale Capital and Salt Lake Potash during the year, along with a portion of its positions in Oracle Power and Ariana Resources.
"The company believes it has a strong financial position as it has no outstanding debt and ensures additional financial flexibility and liquidity by maintaining a bank overdraft facility, currently unutilised. Starvest is well-positioned to benefit from further strength in the natural resources sector through its exposure to early-stage precious metal producers. We believe that worldwide economic growth and more affluent consumers will increasingly demand motor cars, air conditioning, consumer goods, computers and other items that require the development and exploitation of natural resources in order both to produce and power," said Starvest.
Shares in Starvest were up 1.0% at 21.20 pence in London on Wednesday.
By Zoe Wickens; zoewickens@alliancenews.com
Copyright 2021 Alliance News Limited. All Rights Reserved.