Member Info for the_shareminator

I'm surprised by the muted response given they were a better than expected set of results! PGM prices were recovering up until the 'events' of the past 10 days but the price of Chrome has continued to strengthen, some 20% higher than the last quarter average. This is going unreported from what I've seen.

US based copper producer still trading at a 20% discount to last month. Commodity prices are recovering and not yet baked in. Uncertainty the major factor. Long term this price looks like a gift!

This is one of the few miners that has clawed back all recent losses and gone onto to make new highs. A testament of the quality of assets and management. The market has a couple of favourites and this among them. Hochschild and Thor Exploration are the others. Everything else recovering but still playing catch up

The financial results are really standout and what is most encouraging is the average price of gold sold was less than $2,300/oz! They are achieving a gold sales prices some 30% up on last year's averge!

On the maiden dividend, Segun hinted a dividend was potentially on the cards in recent interviews but I wasn't sure if this carrot would be left dangling. Well, credit to the board for following through with this move. Intentions are important for building long term stable investments and the board's commitment to reward shareholders over the next two years and quite likely beyond is a major step up for this small cap!

For my own analysis net cash slightly below my $15-20 million estimate which I'll put down to company initiative repaying a considerable amount of liabilities early. In general I would think cashflow and payments will be more evenly split over the year. Either way it's not a concern given the context.

Fourth quarter EBITDA of $46.2 million and net profit of $34.9 million were better than the $40 million and $30 million I had conservatively assumed. The market seems to have been caught by surprise also. These were about as positive as anyone could have wished for. That AISC were $818 vs the $820 I had been expected on company guidance shows just how accurate company guidance was last quarter.

I will point out that while the gap between EBITDA and net profit in Q4 was larger than many (myself included) predicted it should narrow in Q1 and of course be at least 10% higher on both counts.

The largest investments banks, hedge funds and commodity traders are making trading decisions with a short term outlook. Latest analysis from Citi Bank highlights the pre-buying of commodities to booster stockpiles in the weeks prior to tariffs are compounding the sudden reversal in prices.

"The physical impact of the tariffs imposed should be doubly bearish as the pre-buying and stockpiling of goods and commodities would fully reverse after tightening commodity markets for the past few months"

With the majority of funds having already sold short this event and the effects of global growth as yet unquantified one might hope to see major producers take the initiative and opt to stockpile some output and await more stable pricing in future. I remember during Covid era when gas prices went negative on one day as traders could not offload but it is different for metal mining, they could act to counter the short term market volatility.

It's simply fear forcing weak hands and cautious cash remaining side-lined. I've seen one source cite tariff expectations on precious metals had been pushing prices higher but as they did not materialise it forced the wind out of silver's sails. There is a lot of uncertainty so it's understandable buyers holding fire today. Once the fires are extinguished and the damage can be surveyed I would expect precious metals to make new highs, particularly once US economic data points to higher inflation, slower growth and inevitable rate cuts to stave off the coming recession. Hochschild are perfectly poised to benefit. Hold your nerve folks and sit on those hands.

Yes may bode well for tomorrow but with these tariffs announced this evening who knows. The fear of them has been sapping confidence over recent weeks, London markets more so given the prevailing weakness in our economy. It has helped the precious metal producers stand out and the largest will be moving up the market rankings in the year ahead IMO.

I am reminded that in times of uncertainty cash is king so we have to endure a little turbulence before the effects of the tariffs are fully understood. With the UK outcome better than that of our larger neighbouring EU bloc markets may recover quicker here, a silver lining perhaps?

Gold futures touched $3,200 and will surely be tested again in the coming sessions.

It will be long term but I think the market was expecting higher output than 1.3moz in Q1 which is almost certainly below expectations at the time of announcing guidance back in January. Lower end first half guidance of 4.8moz was unchanged however I noted the wording of achieving nameplate capacity has changed over the quarter from "by the second half" to "for the second half" which I suppose is indicative of delays ("bottlenecks") mentioned in the last news release.

Q4 Update, January 29th

"As production ramps up to reach nameplate capacity by the second half of 2025, the Company will continue to identify and implement cost-saving measures."

Q1 Operational Update, March 31st

"The process of ramping up production to nameplate capacity of 0.8Mtpa remains on track for the second half of 2025."

Quite remarkable the opportunity on offer especially as you say given the news cycle Thor are entering. The financials will be interesting to compare to the projections shared here and I am almost certain they will fuel a bounce in the event they come close to what we have been discussing. More important is the development of Segilola and how quickly Thor can work to build out the mine life. Buy backs and dividends are a show of confidence but the real pull factor will be extending the open pit production another couple of years if possible

The retention of the Mediterranean assets is a positive outcome for ongoing earnings as mentioned and I agree the diversification cannot be understated in today's ever more unstable world.

Before increasing dividends further their stated focus is reducing the debt to lower factor ratio and I think if they can do that through organic growth and revenue then investors will return at higher prices.

That $85m net debt you mentioned has reduced from $129m last quarter but I agree any debt is not nearly as attractive as debt free and as it slides off so too will the attached risk. Relative to how much silver they are now able to produce on an annual basis and forecast to produce over the next 15+ years it's really a fraction of future earnings. In terms of discounts to company valuation and associated risks the obvious one here is locality and underlying tensions with unstable regional neighbours. That's before assessing whether Anglo require any serious capital investment to bring their other mines to production.

Demirli updates are a passing thought from what I can see touted for this year without providing specifics. To me it looks like they are dangling that carrot in front of shareholders. There isn't any clarity on when or how the production schedule will be implemented before the end of this year so unless something changes they will most likely push out the preliminary dates to early 2026. As is so often the case with mining delays are inevitable.

This morning's rise is encouraging! Market impressed by the latest Loots interview yesterday.

Thanks for highlighting! Link to Mining Weekly write up and accompanying video.

https://www.miningweekly.com/article/pan-african-investors-benefitting-from-high-gold-price-and-low-cost-production-growth-2025-03-30

Have yet to find the truly awful reason why the stock is down more than 10% today but I'll hazard a guess it's a combinations of downwardly revised reserves, slower than anticipated milling of ore resulting in another delay to commercial production and presumably to reaching nameplate capacity by end of Q2. Trump's incoming tariffs are playing havoc with the wider markets which could account for part of the pullback from recent highs.

On a more positive note Adriatic have ramped up throughput on the previous quarter, 68kt ore milled vs 47kt ore milled in Q4 2024 with record quarterly silver equivalent production of circa 1.3Moz vs 0.9Moz in Q4 2024.

With construction of the Veovaca Tailings storage complete and permits in hand the company indicated a speedy transition to site with initial tails deposition happening this week.

Financials are neither impressive nor unexpected except to see they obviously have a lot more wiggle room going forward which is a good thing. First debt repayment made today with a remaining cash balance of $75m.

US tariffs on copper imports could be coming within several weeks which has helped fuel copper prices to new record highs.

Sources close to the Commerce Department conducting the investigation into potential copper tariffs cite it's now expected to be resolved sooner. Trump previously threatened to impose 25% tariffs on all copper imports.

The planned levies are part of a broader effort to boost domestic production of critical minerals, following on from emergency measures introduced last week to fast-track the development of new metals and mining projects. Building new copper production capacity in the US will take years however and manufacturers will be expected to front the additional sums to import copper from abroad.

There has in recent sessions been a growing price differential between London and New York as traders push increased supply to the US. This has reportedly left the rest of the world, especially top consumer China, short of copper. It is thought traders may not have enough time to ship out more metal to the US before tariffs land.

Perhaps some price normalisation in the quarter ahead as US demand reduces but further out US manufacturers will be paying up to 25% more to replace their Copper stockpiles at least until domestic supply can catch up.

https://www.mining.com/web/trump-weighs-imposing-copper-import-tariffs-in-weeks-not-months/

Following the termination of the Carlyle deal the 2025 revenue forecast is expected to increase by around 10% to $1.74 billion. The sale was due to remove a significant chunk of debt associated risk as well as reward short term holders with a special dividend which is why there has been a negative market reaction. Faith in the management to turn new record earnings in the year ahead!

Anglo are a primary copper producer going forward so leaving out 6,500 tonnes of copper production from those projections isn't fair analysis. Both Thor and Anglo are undervalued in the current environment of record high gold and copper prices.

The company have bitten the bullet and written down assets in Mali, an inevitable outcome given the country's descent into chaos over the past couple of years, more recently holding mining execs from Barrick and Resolute to ransom!

Moving forward there is uncertainty surrounding US trade rules and whether Capital are able to benefit from this type of environment isn't immediately obvious to me. The past couple of updates may be indicative of a tough year ahead but the price has fallen some way to reflect that and could be good value if outcomes are mildly better than expected. Oversold perhaps? I'll be watching for those signs to load up again!

The USD has completely fallen out of favour in recent months which has only served to add fuel to the price rises we are witnessing in gold and silver!

The silver price is trading 40% higher than a year ago up near 12 year highs after adding more than 3% to the price today!

JPM forecasts upside to copper price which is already trading near record highs, expecting the copper price to reach $11,500/t in in the second quarter of 2026.

Significant news today and a rerate to be expected following SROL's exoneration. The board and investors as a whole have been incredibly patient considering the damage these allegations will have caused so hopefully this issue has now been put to bed.

Also credit well deserved HarChris and the other informed commentators who correctly called the outcome!