Member Info for SGD27

The July presentation is out today:

https://www.yellowcakeplc.com/wp-content/uploads/2021/07/Yellow-Cake-Investor-Presentation-July-2021-Final.pdf

NAV/share on 12 July was 250p, based on U at $32.35/lb.

Correction: fulmar29's post on Monday (19 July).

Just a follow-on from my post on 24 June and fulmar29's post on 29 July.

Progressive Planet held this webinar a few days ago :

https://howardgroupinc.com/2021/07/progressive-planet-management-webinar-video/

I found it all quite interesting, but I know how very busy you folks are, so here's some pointers to relevant highlights:

05:30 - Organic growth but also "rapid growth through potential acquisitions"

11:40 - FLY ASH: The disappearing SCM in North America. "Natural pozzolan does everything that fly ash does, but better"

17:45 - Natural pozzolans. "They're not new..."

34:40 - Expansion opportunities, specifically mentioning California/Nevada

Of course they don't qualify as a "CRMC", but indications of acquisition activity in our sector (and our geography) are always welcome.

I might have even considered an investment in CVE:PLAN, but the platforms I use (HL & Fidelity) don't seem to offer it :-(

POW RNS, an update on their plans for Garfield & Stonewall :

https://www.investegate.co.uk/power-metal--pow-/rns/golden-metal-resources-nevada---update/202107090700036883E/

The 500 would have been breached on 21st June, when the shares from the $88m raise became active.

Current mcap ~$575m.

https://www.prnewswire.com/news-releases/bacchus-capitals-uranium-venture-yellow-cake-plc-reaches-significant-milestone-as-market-capitalisation-exceeds-us500-million-301327814.html

https://twitter.com/quakes99/status/1411811691449389062

Hope you're right about NXE, it's doing quite well so far today.

You could add "family offices" to your list of buyers - see my YCA posts.

Hi Dog & Monkey,
NAV is down today (RNS'd at 37.43) but I'm wondering the SP fall is partly just due to institutions having an end of half year tidy-up. So I've also grabbed what I hope will turn out to be a bargain @38.7.

Just to be clear, UTC is buying on behalf of "a large multifamily office", it isn't one itself.

"Uranium Trading Corporation (UTC) through its parent company 92 Trading LLC is an U.S. agency based trading firm that specializes in procuring, selling, transporting and storing uranium oxide (U3O8) and uranium hexafluoride (UF6) on behalf of institutional, family office investors and high net worth investors."

Now family offices are buying U, front-running SPUT:

https://www.prnewswire.com/news-releases/uranium-trading-corporation-makes-initial-uranium-purchase-301322469.html

I must admit, I had to look up what a "family office" actually was. For anyone else unfamiliar, here's an explainer:

https://www.investopedia.com/terms/f/family-offices.asp

The Baker's web page has also been updated & includes the plan :

https://www.sunriseresourcesplc.com/bakers-gold-project-australia

The PDF version of the RNS on the company website includes a drill plan. It's here :

https://www.sunriseresourcesplc.com/downloads/sunrise-resources-plc-rns-bakers-project-drilling-results-29-june-2021.pdf

Although the 2 hours was mostly boring/irrelevant, I did find it built up a picture of the CRMC management mindset. The main aim of Cemex Day 2021 seemed to be to impress the ratings agencies, to try to achieve "investment grade" rating for Cemex.

Therefore, although they have plenty of cash to spend, I don't think they'll be throwing it around like confetti. They'll want to be seen to be driving hard bargains, and will do plenty of due diligence first to ensure that they're going to get payback, both ASAP and in the long run.

Our recent deals have included royalty components, so maybe the CS deal will too. This could work quite well for us, because a CRMC will probably get things up and running very quickly, if only to keep the ratings agencies happy!

Who knows which CRMC it will turn out to be? There are plenty of lists of candidates, for those interested in research, e.g.

https://constructionreviewonline.com/top-companies/top-10-cement-producers-in-the-us/

A possibly relevant event yesterday:

https://www.cemex.com/cemex-day-2021

Sound bites: "climate action goals", "beginning of a new era", "period of sustainable growth", "~$500M Bolt-on investments", etc., etc.

You can thank me for listening through the whole 2 hour video so that you don't have to. I was hoping they might let slip something directly relating to us; they didn't, but plenty of general talk about CO2, clinker reduction, etc., even if natural pozzolan wasn't specifically mentioned.

A few snippets, if you don't have 2 hours to spare:

0:32:55 - 0:41:00 Investment strategy
1:19:15 - 1:20:20 Demand from customers worldwide for low CO2 products, regardless of regulations.
1:49:40 - 1:51:52 Many investment projects underway, which have to be prioritised.

One imagines that other CRMCs will be in a similar position regarding CO2-related investments (e.g. see my post about MMM on Wednesday 23rd). So I'm getting a very positive feeling about the timing of our offering :-)

Some of them aren't doing too well :

23-Jun-21 09:48:01 0.2405 70,947 Sell* 0.24 0.26 170.63 O
22-Jun-21 10:04:06 0.2819 70,947 Buy* 0.25 0.29 200.00 O

There are all sorts of materials being tried out as SCMs (Supplementary Cementitious Materials) because of the declining availability of fly ash: metakaolin, ground glass, silica fume, rice husk ash, etc. etc. So there's plenty of competition for natural pozzolan, and it's hard to argue against using recycled materials where possible.

I think there's some good news here though - a company which has found that a mix of recycled glass and natural pozzolan produces great results, as announced yesterday:

https://www.proactiveinvestors.com/companies/news/953161/progressive-planet-receives-positive-results-for-its-pozglass-scm-testing-953161.html

In this earlier video, they explain the advantages of including natural pozzolan in the mix:

https://www.proactiveinvestors.co.uk/companies/news/947672/progressive-planet-hailing-success-in-phase-1-pozglass-scm-testing-947672.html

I suppose we have to know our place when dealing with these large CRMC companies, which may have much bigger issues to deal with.

Example 1: Boral are currently trying to fend off an AU$8b takeover bid by Seven Group.

Example 2: A bundle of cement & related assets in California & Arizona is being bought by Martin Marietta Materials from Lehigh Hanson (a Heidelberg Cement subsidiary) for US$2.3b.

MMM put together an interesting strategy presentation in February (before the above deal):

https://ir.martinmarietta.com/static-files/8a92a1e0-c5e5-4500-9793-de1e9166fd38

I thought Slides 30 & 31 were quite relevant - they're highlighting how acquiring an already permitted resource (like ours!) suits them far better than developing one themselves from scratch. Note also that they assume ~7 years from land acquisition to first sales, so maybe we're not doing too badly.

They've just done a fund raise to pay for the Lehigh assets :

https://ir.martinmarietta.com/news-releases/news-release-details/martin-marietta-announces-pricing-terms-debt-offering-3

with half a hint that there may be enough left over for further smaller acquisitions.

I think these CRMCs are hoping to drive a hard bargain with covid-stressed minnows suffering cash-flow problems. Fortunately we don't fall into that category after our £1m fund raise at .28p, which in hindsight looks very well judged to me. And any delays in negotiations are in our favour given the way the pozz/perl market is moving.

More comment on the MMM deal here:

https://seekingalpha.com/article/4433355-martin-marietta-materials-latest-acquisition-represents-another-step-in-the-right-direction

"[MMM Management] called its acquisition pipeline "robust," which indicates an appetite to continue to make bolt-on acquisitions, though the deal size is likely to be limited".

The Garfield & Stonewall web pages have now been updated.
https://www.sunriseresourcesplc.com/garfield-copper-gold-project-nevada
https://www.sunriseresourcesplc.com/stonewall-gold-project-nevada

Boral have now sold their North American Building Products business. They plan to return cash to shareholders, but perhaps they'll still have some spending money left over?

The situation regarding their NA fly ash business strategy appears to be unchanged:

"As part of the review of Boral’s North American Fly Ash business (announced on 15 April 2021), Boral is continuing to explore value creation opportunities through a potential joint venture, strategic alliance, divestment to a third party or continued ownership of the Fly Ash business. We expect to be in a position to update the market at our full year results announcement in August, or earlier if appropriate."

https://www.boral.com/sites/corporate/files/media/field_document/20210621-Boral-Supplementary-Targets-Statement.pdf