Market Update

General - Gold - Nickel

Good afternoon

just deleted my work…so today´s comment might be a little shorter!

Looks like Australia´s Morrison has done , what seems to be a habit by Australian prmiers: If the US president asks, you follow like a dog….exhibting the difference between an ally and a vasall…The Trump story is getting wilder by the day. The loss of moral, ethics, and the truth under his presedency reaches a new level! What happened to this country,which once was the second best democracy ( behind - probably - England ) and our closest ally???

Manufacturing is looking weak around the world - the US PMI fell to a 10-year low today, weaker than all expectations! Equities had been halfway positive until this number came out - Europe quite weak now, and US Futures have also turned down 100 points in the Dow within minutes…bonds jump, gold jumps…nickel 1% up / copper and zinc down 2%. I wonder, whether tehse numbers will make Trump even harsher in his dealings with China, or whether he will see the need to save the economy? I guess he does not want to go into an election with a recession on his hands…

Gold - after breaking support yesterday, we could well see a test of 1400-1420 US$…that would mark a 50% correction of the recent rise. Still big inflows into gold ETF´s, and ample reason to own gold….from gepolitics, low interest rates to a ballooning US budget deficit ….these things, I fear, will stay with us for a while! Anyway - since the PMI in the US came out, the chart break looks increasingly like a bear-trap , with gold trading at 1484 US$ now and rising!!!!

Nickel - LME stocks have been falling from about 450.000t in 2015 to a low of 144.000t a few eeks ago. Since then, they have been pretty volatile - reaching a high of 167.000t in mid-September, but falling by a very large 5800t today to 152.000t….pretty positive for prices. But Macquarie´s research makes me think today…NPI production in China/Indonesia very strong this year, and NPI prices at a large discount. Obviously, we have the early days of a diverging price for different types of nickel. We need to hope, that high quality stainless steel continues to grow at the expense of low-quality steel, and that EV´s really take off the way many are expecting. The release of the new Porsche EV sports car seems to be a step in the right direction - apparently, an absolutely fantastic car - but expensive! More important will be, how the market accepts the first VW mass market EV!

The A$ is making fresh lows - below 67 against the US - and looking at charts, will at some stage test the low 60ties level. Similar to the Euro - also making fresh, recent lows and now looking to test the old lows around 1.05. This price action would be congruent with gold testing 1400-1420 as well. So at least in terms of the textbook, could well happen!

Have a nice evening

General - Exploration stocks

Good afternoon

Trump is becoming even wilder in his tweets - is he under pressure, and more so, than we believe??

He is also chatting about eliminating China from US-financial markets…the next step of escalation in the trade war.

China´s Manufacturing PMI is still slightly negative, but better than expected, while the Dallas Fed Manufacturing Outlook has been positive. Equities are quite strong today - metals generally strong ( nickel, lead and zinc up by about 2%, while copper a liitle weaker ).

Gold has been relatively weak today - the US$ has been strong, and equities are strong. Gold has not had a decent corection, since it started running a few month ago - so perhaps this is happening now. But holdings of Gold ETF´s continue to rise strongly, and are close to an alltime high, indicating much more investor interest. And as we all know, there is ample reason to buy gold, from politics in the US, to geopolitical instabilities, a possible recession in many countries, ultral-low interest rates and continued record budget deficits in the States. As I am finishing, gold has broken support at 1480 and is tarding at 1476 US$/oz!

There has been a real lack of fresh info on the mircroside recently. Companies have been pre-occupied with the ened to publich their Annual Reports - a myriad of them being done in the last few days. And for mining and exploration companies, the Quarter is just finished - so Quarterly Reports will come out soon. usually, companies save some fresh info for their Quarterlies, unless it´s so significant, that it has to be published immediately.

But one theme has been interesting over the last few days/weeks: Exploration stocks are getting a real hearing! Companies like CARAWINE, CHALICE, LEFROY, DEVEX to mention a few, have been very active. Interest is focussing on potentially large scale exploration progress in areas surrounding some big, existing resources - like in Victoria, where Kirkland have had their amazing success, surrounding Cadia in New South Wales, or in the case of Lefroy, next to Goldfields big disovery in Western Australia. Some companies have seen spectacular rises in valuation, like STAVELY MINERALS, which jumped 600% from recent lows to a market cap of 180 Mill A$ ( the market had given little attention so far to some steady progress, but got really excited about a recent drill hole containing 32m with nearly 6% copper, 52g silver and 1 g gold/t ), and ALKANE, which doubled to 370 Mill A$ market cap ( based on a drill hole of 500m containing 0,48g gold and 0,2% copper , indicating a phorphyry-stile deposit ).

I think it´s time to put a foot in the door here…but whatever you do: Do not buy those ( generally ) which have already put of a few hundred%, and not only one stock….and watch out for those, which have raised funds recently and are cashed up for drilling!

Have a nice evening

General - Strike - Panoramic

Good afternoon

turmoil…Johnson and Trump under pressure…in my opinion, the transcript of the phone call just shows, that the old fox is not stupid! Will be very hard to topple that guy!

New Home Sales in the States very strong…but Europe continues to look very fragile, even though we have had no fresh dramas today from the macro-front!

The US$ strong again - metals are recovering from slightly weaker to slightly up in late afternoon, following some constructive gestures by China, and positive comments from Trump re trade agreement.

Gold is under a little pressure today - mainly in US$, though.

Strike Energy - Nev Powers, who has done an outstanding job until last year as CEO of Fortescue, and is one of the most highly regarded mining executives in Australia, has become a non-executive director. He also owns about 10 mill shares in Strike. I guess, that he is happy to support the current chairman ( I have heard, that they are good friends ) - but obviously, he is also putting his money where his mouth is, and by becoming director, he must be happy to hold on to them for the long term!

Panoramic - the rights issue is finished - thanks god, as it should remove the pressure from the stock. The shortfall was 20%, which is relatively low. Nevetheless - I guess today´s high turnover might well relate to the shortfall. Nickel is holding above 17.000 US$/t, and the Australian $ continues to be weak - and on top of that, we have this PGM-story, which I spoke about the other day ( by the way - I checked with Macquarie research - they value it at zero )….a great setting to make money for PAN! Now we need to see Savannah North to reach ore, and ramp-up quickly from November on.

Still not much to report, I fear!

Have a nice evening

General - Horizon Gold

Good afternoon

the demise of Thomas Cook did not help today - but main reason for weak equity markets in Europe today have been very weak PMI´s. I think recession in German is now a done deal! Manufacturing is clearly under pressure! The Euro fell after the numbers were announced, and is trading at the lowest level since May 2017.US PMI is looking much better ! At 51, it´s a little stronger than expected.

Despite the strong US$, gold is advancing a little and is trading at 2250 A$/oz currently. Gold stocks in the States are having another strong day…

Metals are weaker as well - only nickel is up again . Platinum / Palladium continue their big run.

More M&A at the junior end….Osisko bidding for Barkerville, paying with paper in a pre-market 338 mill CAN$ valuation.

Horizon Gold - the small company had a pretty big run in the recent run-up of gold, from 15ct to 42ct…But more recently, the stock has come back again to the current 30.5ct. I guess the market is anticipating a capital raising at some stage, and given the cash holding of 1.9 mill A$ as at the 30th of June, probably rightly so - definitely before Christmas. The market cap of 23.3 mill A$ I think is a sexy entry point, though. HRN have a resource of 1.39 Mill oz, of which 2/3rd are free milling - the rest is refractory ore, and at this point, I am not valuing it. But especially the two open-pittable high grade resources, Swan and Swift, with a combined 410.000 oz at 7 g / t gold resource, are subject to mining studies, using a standalone plant, but also processing by neighbouring plants. This could generate pretty meaningful cash flow. I am just speculating here ( the company has not released the potential size, nor any other parameters ) , but assuming 200.000t of yearly mining rate, and trucking + toll-treatment at say 1700 A$ total cost , could result in something like 40.000 oz of production and at current, elavated gold prices, cash flow of 22 mill A$ p.a. ! I have no idea, how much the pre-production cap ex might be - but even a 15 mill $ number would still make it a highly attractive proposition! These numbers really just for giving you a feel - they are highly speculative at this point. I would expect some more - at least preliminary - numbers from the company before year end. But in any case, I think the stock could easily re-visite recent highs over the next few month, given the very low valuation for ounces in the ground, and good exploration potential for base metals and gold. I have a small holding in HRN.

I fear not much to report today!

Have a nice evening

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

General - Panoramic ( PGM´s )

Good afternoon

China induces some more liquidity into the banking system…markets are hoping for some more progress in US/China trade talks.

Metals looking ok today - nickel very strong + 2%. LME stocks, which had risen by more than 10.000t on the 12th, have since fallen by more than 12.000t…incl 3200t today. We are now back to 11.70 A$/lb!. Cash is trading at the largest premium to the forwards, indicating strong physical demand.

Big turnover in gold stocks generally today - reweighting of the GDXJ took place. More Index action, this time in the S&P ASX, affecting only a few of our stocks incl West African and Bellevue , will be taking place on the 23rd of Sept.

sorry, you have to listen again to my jibbery about Panoramic - this time, in relation to it´s Panton Platinum/palladium project.

Panoramic - Panoramic bought this asset a few years ago - I think it might have been in 2015. It contains 14.3 millt of ore, grading 2,19g/t Platinum, and 2,39g/t of Palladium, for just over 2 mill oz of PGM´s. It´s located close to PAN´s Savannah operation in the very North of Western Australia, which offers some potential synergies. Note also the higher grade in Palladium, as it´s price today is 2423 A$/oz vs Platinum 1390 A$/oz - so worth a lot more. But what is important is the basket price of the two metals: In the old days, between 2010 and 2015, the basket traded in a band of between 2100 - and 2900 A$/oz ( the high reached in 2015 ) . In 2018, this high was nearly reached again - 2800 A$/oz was the top in 2018. TODAY, THE BASKET IS TRADING AT A PRICE OF 3800 A$/oz, nearly 1000$ higher than the 10 year high prior to 2019, and 900A$ since the beginning of this year!!!!! Partially due to the weak A$, but mainly because of the big run Palladium has had over recent times. If I value this resource only at 50A$/oz, it´s worth 105 mill A$ or nearly 20ct/share Panoramic. Given the rare occurence of PGM-projects outside of Russia and South Africa, I think 50A$ is a very conservative valuation and equivalent to valuations of reasonable gold resources in the Australian market.

At current prices for PGM´s and nickel ( which will generate 100 mill A$ in free cash or more from some time in 2022, when the hedges are gone ), PAN could easily be worth 700 Mill A$ based on Savannah ( 500 mill at 5x free cash generation, that´s very conservative - also, the Feasibility study gave us 690 mill A$ NPV8 at nickel price of 8$ (( today 8,11 )) and 70ct exchange rate (( today 68ct )) , + PGM´s valued at 100$/oz….and the 50% shareholding in Horizon for free! That´s a sleasy 1,30 A$/share in PAN….Sounds a bit like dreaming - but why not? I think that would not be a crazy target for the patient investor. The stock has been hammered because of the well-documented problems in mining the old ore body, Savannah, and the need to raise some more equity - which is now behind us. Mining of the new ore body, Savannah North, should start in November and ramp up quickly - making the current problems forgotten very quickly, I hope and think!

Panoramic has it hands full to bring the Savannah/Savannah North ore bodies into proper production - but I think the incoming CEO ( whoever that might be and whenever until mid next year he will join ) will need to spend some time on a) exloration to show the possible upside of Savannah North to much more than 10 years mine life and b) getting some value from Panton, which is currently valued at zero, and has completely forgotten about by the market!! Platinum is tarding at it´s highest in A$ terms since late 2016, at 1395 A$/oz, while Palladium at 2439 A$ currently is up from 1000A$ as recently as the end of 2016!!

There is always something in mining, which goes wrong - but I see really strong potential in PAN from current levels. The restart-problems at Savannah should be forgotten within a few month, and PGM´s are a true wildcard!

For investors, who shy away from a single stock: My Nestor Australien Fund currently has a 3,75% weighting in Panoramic. My top recommendations West African, Strike, Genex, Sheffield, Graphex and Metro Mining incl Panoramic have a joint weighting of approx 27% - emphasizing the development nature and the upside of many of my holdings - but also some risk management across different minerals and metals/sectors. The largest non-resources holdings are Macquarie Bank, and Tassal Group, Australia´s largest salmon farmer. The fund is up by approx 20% this year - about in line with the market, and strongly outperforming since mid-year, following a dismal performance in the first half of 2019.

Have a nice weekend and enjoy the great sun shine - the end of summer! Following this, we finally should have some much-needed rain in Germany!

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