Good afternoon
Trump is trying to save his…. - suddenly imposing sanctions on Turkey, just days after opening the door for them to invade Syria!
The IMF has cut the growth forecast for this year from 3.2 to 3%, and next year from 3.5 to 3.4%…notas bad as I would have feared, and I think on the optimistic side of what we will see!
First Quarterlies in the States look at least ok - with J.P.Morgan a standout.
Gold ETF´s…o.k. don´t want to bore you..but the 21st day of inflows…price is holding…in A$ terms, it´s 2210 A$/oz
Palladium - new high again today…platinum also up…the combined price in A$ hitting a new all time high of 3873 A$/ot Plat+Pall
Nickel had a tsrange move late yesterday - down by a staggering 100$T/t in late trading. It recovered strongly today by 380 $/t as we speek, scratching the 17.000 US$/t mark again.
Evolution - you can se what the A$ does to Australian miners..new all time high of net mine cash flow 207 mill A$ last Quarter, despite an unusually average Quarterly Report! Costs moved up quite strongly from AISC of 915 A$ to 1018 A$/oz - or All-In-Costs of 1330 vs previous Quarter 1213 A$/oz. 20$ of this rise are due to higher royalties, payable on the higher gold price - about 30$ are because of a wall-instability at Mt.Rawdon - still, leaves 50$ higher costs. Some of this can be explained by lower by-product credits, as copper has been weaker during the Quarter. The company had record net mine cash flow from Cowal and from Ernest Henry, it´s two flagship mines - but Mt.Wawdon was weak ( see above ), as was Mt.Carlton, which went through a phase of difficult ground conditions.
EVN have kept production guidance unchanged at 725-775.000oz - but AISC guidance has been increased by 50 A$ to 940-990 A$/oz - based on higher gold royalties and higher costs at Mt.Rawdon. I wonder, whether this might be a little optimistic? EVN are constantly working on reducing costs - but I have no doubt, that a few items are pushing North like labor costs, water etc…
Drilling of the new underground resource at Cowal has now ( as the exploration decline has been developed ) moved into full swing, delivering some good results.
In any case - a very good Quarterly, positioning them again within the most competitive gold producers world wide - but this time, a touch below expectations due to the cost increases. Nevertheless - Jake made strong hints as to an increased dividends for the current year, planning to pay out 50% of free cash generation.
West African Resources - interesting move today: Morgan Stanley became a substantial shareholder today - 42.835 mill shares of those are held by Morgan Stanley Nominees for someone…representing 4,92% of the company and just below the threshold of reporting a seperate, substantial shareholder notice. Interesting! Who is the beneficial owner??
Troy / Great Panther - once a difficult mine, always a difficult mine? This word works in 80 out of 100 instances - certainly for Troy, which recently had a wall failure fllowing numerous other problems, and now a fatality….and Great Panther just reduced guidance for Tucano ( which we all know from the old days at Beadell ) , also due to instabilities of a pit wall. Recently, when TRY annunced to be debt-free, I was almost tempted back into them…I am not tempted anymore!! And as successull, as our early investment in beadell has been years ago - Tucano hardly ever lived up to expectations, and this got worse, when new management took over a while ago from Peter Bowler! What a smart move of him to exit this story back in 2014…as did we and most of our clients!
Oceana - Quarterly production report was about 15% down on previous Quarter…not good at all! New guidance is 460-480.000oz for this calendar year, at 1040-1090 US$/oz AISC. That compares to previous guidance of 500-550.000 oz at 850-900 US$/oz. Copper guidance is also down by nearly 30%. Main reason for the downgrade is the ongoing closure of Didipio in the Phillippines, which continues to be subject t a blockade. The relatively low-cost operation is an important source of earnings for OGC, and the ongoing problems there are a major negative. Not that OGC have done anything wrong in the country - the mining operation I believe is being managed very responsibly - but the country remains one of the more difficult places to operate a mine!
Have a nice evening
WS
WS
Schröder Equities GmbH
Seitzstr.7a
80538 München
Tel. +49-89-4613440-0
Fax +49-89-4613440-10
email: wschroeder@schroeder-equities.com
website: www.schroeder-equities.com
eingetragen im HR München, HRB 166985
Geschäftsführer: Wilhelm Schröder
The information contained in this communication is confidential and is intended only for the use of the addressee. Unauthorised use, disclosure or copying is strictly prohibited. If you have received this communication in error, please delete it and notify us by telephone at +49-89-4613440-0, by fax at +49-89-4613440-10 or by e-mail at wschroeder@schroeder-equities.com immediately. Please note that this communication does not constitute and may not be construed as investment advice and / or referral to buy or sell financial instruments. Unless specified otherwise, the views expressed in this communication are solely subjective notions of the individual sender and / or the entity or individual stated as the author of any information submitted. Performance in the past may in no case be considered as an indication for future performance. Please also note that Schröder Equities GmbH and / or its officers or employees may have interests in financial instruments referred to this communication. A current list of shareholdings can be emailed on request. Furthermore, our clients are hereby informed that Schröder Equities GmbH renders advisory services to Nestor Australien Fonds, an investment fund administered by Nestor Investment Management S.A. Luxemburg. Please also note that e-mails can be intercepted by