SP Angel Morning View -Today’s Market View, Thursday 25th July 2024

Summer rout in equity markets weighs on risk sentiment

MiFID II exempt information – see disclaimer below

Anglo American (AAL LN) – H1 results include US$1.6bn write down of Woodsmith

Arkle Resources* (ARK LN) – Update on Botswana Lithium as potential brine discovered

Centamin (CEY LN) – Interim results report 53% dividend payout

Fresnillo PLC (FRES LN) – Q2 Production results as Saucito offsets Fresnillo weakness

Metals One plc (MET1 LN) – Norwegian drilling programme to start in August

Sovereign Metals* (SVML LN) STRONG BUY, Valuation 55p – Dry mining trial completes ahead of hydraulic mining tests

Syrah Resources (SYR AU)– Quarterly production results show Vidalia ramp up but cash balance slides

Gold prices ($2,377/oz) dump as traders continue to take profits before key inflation data

• Gold prices pared gains overnight, sliding to recent lows of $2,366/oz having strengthened yesterday to $2,430/oz.
• Volatility comes despite relatively stable US Treasury yields, with the 10-year hovering around 4.23%.
• Focus turns to tomorrow’s US PCE data, which traders will be watching for signs of further progress on inflation.
• Expect a hotter number to weigh on gold following a strong rally over the past month as Treasuries rallied and markets priced in a 100% chance of a September rate cut.
• Traders currently price in two 25bp rate cuts this year.

Copper ($9,033/t) hovers around key level as China pessimism weighs on base metals

• Copper continues to suffer from a wider metals sell off, with the LMX Metals Index hitting April lows.
• Copper slid below $9,000/t this morning in Asian trading before regaining some ground.
• Global inventories continue to rise, with China exporting metals into international warehouses on weak domestic demand.
• Nickel fell below $15,900/t to hit four-year lows.

Iron ore suffers from weak steelmaking margins as Brazilian supply grows

• Iron ore prices are hovering around the $100/t level for 62% Fe fines in China.
• The level as seen as a key point in the iron ore cost curve given OPEX levels for marginal Chinese magnetite production.
• Chinese mill steel inventories reportedly rose 5.8% in over the first two weeks of July, with volumes up 4% yoy.
• Steel mill production volume at three month lows.
• Nippon steel has pulled out of a JV in China on weak car sales.
• China October rebar futures are down 5% this month and over 12% since May.

Deepsea ‘batteries’ offer new source of oxygen for the planet

• Scientists identified a new oxygen source from metal “batteries” deep in the Pacific Ocean.
• This oxygen, termed “dark oxygen,” is found at depths around 4,000 meters where light cannot penetrate, making photosynthesis impossible.
• The oxygen is produced by natural mineral deposits on the ocean floor, which act as weak batteries, generating enough voltage to split seawater into hydrogen and oxygen.
• The finding was confirmed through lab experiments at Northwestern University, where scientists recreated the process.
• Although the oxygen amount is small compared to that produced by photosynthesis, it may support deep-sea ecosystems. This discovery may impact deep-sea mining practices, as these areas are crucial for marine life diversity.

Global EV sales hit record high in Q2 2024

• Global EV sales hit an all-time high in Q2 2024, with a 19% increase from Q1 and nearly 2.6m EVs sold globally since May. (New Automotive Global EV Tracker)
• China continued to be a major driver of global EV sales – the country has seen petrol and diesel vehicle sales down 20% yoy in June, suggesting ICE vehicles might become obsolete in the country by 2028.
• The US saw a 12% increase in EV sales in Q2 compared to Q1 – over 1.15m EVs sold YTD, an increase of 200,000 from the previous 12 months.
• Despite new tariffs on Chinese EVs, 80% of EU countries reported an increase in EV sales between May and June.
• The UK and Germany reached their highest EV market shares since December 2023, at 15% and 19%, respectively.
• EV sales in emerging markets like Thailand, India, Brazil, Chile, and Mexico collectively more than doubled in the year to June compared to the previous 12 months.

SP Angel rankings LSEG StarMine Award for most accurate forecasting in Reuters polls:

• No1 – Q2 Precious Metals and No2 – Q2 Base Metals. Our forecasting uses HI – not AI

SharePickers: Is there a Banking Crisis in China?  Video: https://www.youtube.com/watch?v=rLUGXIhl2q4

•         Podcast: https://audioboom.com/posts/8544049-john-meyer-is-there-a-banking-crisis-in-china

Economics

US – Equity markets report the worst day since late 2022 following underwhelming overnight earnings results from Tesla and Alphabet.

• Former NY Fed President, William Dudley, called for the Fed to start cutting rates as early as next week changing from a “higher for longer” view.
• A rate cut in September is fully priced in compared to a chance of ~60% at the beginning of the month thanks to reports of slowing inflation and labour earnings.
• Private sector growth accelerated to its highest in 27 months in July as a pick up in services sector outweighed a contraction in manufacturing.
• New business orders climbed at a slightly reduced rate, although, services reported the strongest increase in just over a year.
• Respondents highlighted pressures on margins as output prices rose at the slowest rate in the past four years while inflation in input costs came in at the highest pace in four months.
• Higher wage pressures remained a dominant factor behind price hikes, especially in the service sector.
• Employment rose for a second consecutive month.
• Coming presidential elections and political uncertainty weighted a little on business sentiment.
• “The flash PMI data signal a ‘Goldilocks’ scenario at the start of the third quarter, with the economy growing at a robust pace while inflation moderates,” S&P Global PMI report read.
• Flash Manufacturing PMI (Jul/Jun/Est): 49.5/51.6/51.6
• Flash Services PMI (Jul/Jun/Est): 56.0/55.3/54.9
• Flash Composite PMI (Jul/Jun/Est): 55.0/54.8/54.2

China – The central bank unexpectedly cut one year lending facility rate by 20bp to 2.30%, days after reducing a key short term rate.

• This marks the first reduction in almost a year and atypically announced towards the end of the month as opposed to usual mid month timing.

Germany – Business outlook pulls back further in July following poor PMI data released yesterday.

• “Scepticism regarding the coming months has increased considerably… the Germany economy is stuck in crisis,” IFO Institute commented on data.
• The economy is struggling with high borrowing costs, strong inflation as well as lacklustre overseas demand as China is not growing at rates expected previously.
• IFO Current Assessment (Jul/Jun/Est): 87.1/88.3/88.5
• IFO Expectations (Jul/Jun/Est):86.9/88.8(revised from 89.0)/89.3
• IFO Business Climate (Jul/Jun/Est): 87.0/88.6/89.0

South Korea – GDP disappoints in Q2 on the back of a fall in consumer spending.

• The economy contracted 0.2%qoq versus Reuters forecast 0.1% increase and down from a 1.3%qoq increase in Q1.
• That was the sharpest contraction in six quarters.
• Private consumption was down 0.2%and construction spending fell 1.1% with exports climbing 0.9%.
• Poor data raises chances of a policy rate cut in the coming months.

Currencies

US$1.0834/eur vs 1.0849/eur previous. Yen 152.37/$ vs 154.77/$. SAr 18.522/$ vs 18.405/$. $1.288/gbp vs $1.290/gbp. 0.653/aud vs 0.660/aud. CNY 7.243/$ vs 7.274/$.

Dollar Index 104.33 vs 104.42 previous

Precious metals:         

Gold US$2,375/oz vs US$2,416/oz previous

Gold ETFs 82.2moz vs 82.1moz previous

Platinum US$941/oz vs US$957/oz previous

Palladium US$916/oz vs US$935/oz previous

Silver US$27.97/oz vs US$29/oz previous

Rhodium US$4,650/oz vs US$4,650/oz previous

Base metals:   

Copper US$ 8,979/t vs US$9,152/t previous

Aluminium US$ 2,281/t vs US$2,301/t previous

Nickel US$ 15,640/t vs US$15,985/t previous

Zinc US$ 2,636/t vs US$2,691/t previous

Lead US$ 2,033/t vs US$2,049/t previous

Tin US$ 28,985/t vs US$29,730/t previous           

Energy:           

Oil US$81.1/bbl vs US$81.2/bbl previous

• Crude oil prices edged lower after the EIA reported a 3.7mb w/w draw to crude, 5.6mb draw to gasoline and 2.8mb draw to distillate stocks in the US, with refinery utilisation falling 2.1% w/w to 91.6% due to Storm Beryl.
• European energy prices were flat as EU natural gas storage levels surged 3.2% w/w to 83.4% full (vs 73.7% 5-Yr average) with all countries in excess of 76% full and aggregate storage now at 947TWh

Natural Gas €32.4/MWh vs €31.5/MWh previous

Uranium Futures $82.6/lb vs $83.2/lb previous          

Bulk:   

Iron Ore 62% Fe Spot (cfr Tianjin) US$100.0/t vs US$99.5/t

Chinese steel rebar 25mm US$507.8/t vs US$506.9/t

Thermal coal (1st year forward cif ARA) US$114.8/t vs US$112.7/t

Thermal coal swap Australia FOB US$138.6/t vs US$138.0/t

Coking coal Dalian Exchange futures price US$204/t vs US$205.4/t

Other:  

Cobalt LME 3m US$26,625/t vs US$26,625/t

NdPr Rare Earth Oxide (China) US$49,981/t vs US$49,627/t

Lithium carbonate 99% (China) US$11,253/t vs US$11,204/t

China Spodumene Li2O 6%min CIF US$970/t vs US$970/t

Ferro-Manganese European Mn78% min US$995/t vs US$995/t

China Tungsten APT 88.5% FOB US$325/mtu vs US$325/mtu

China Graphite Flake -194 FOB US$470/t vs US$470/t

Europe Vanadium Pentoxide 98% 5.1/lb vs US$5.1/lb

Europe Ferro-Vanadium 80% 26.75/kg vs US$26.75/kg

China Ilmenite Concentrate TiO2 US$315/t vs US$314/t

China Rutile Concentrate 95% TiO2 US$1,388/t vs US$1,382/t

Spot CO2 Emissions EUA Price US$64.6/t vs US$64.6/t

Brazil Potash CFR Granular Spot US$297.5/t vs US$297.5/t

Germanium China 99.99% US$2,075.0/kg vs US$2,075.0/kg

China Gallium 99.99% US$427.0/kg vs US$427.0/kg

Battery News

Ola Electric expected to launch $740m IPO in August

• Ola Electric is planning to launch its IPO in the first half of August, aiming to raise approximately US$740m.
• The startup is expected to be valued at around $4.5bn for the IPO, a decrease of 16-20% from its valuation during its previous funding round.
• Earlier in 2023, the company secured US$50m in debt funding from EvolutionX Debt Capital.
• Ahead of the IPO, Ola Electric is undergoing restructuring to reduce costs and streamline operations, including plans to lay off 400-500 employees.
• Ola Electric is backed by SoftBank and is one of the largest two-wheeler EV manufacturers in India.

Tesla gives encouraging update on 4680 battery cells

• Tesla provided a positive update on its 4680 battery cell development, which was reportedly close to being abandoned.
• Elon Musk set a year-end deadline for the team to deliver on the 4680 cells, first unveiled in 2020, promising reduced costs and improved performance.
• Tesla produced over 50% more 4680 cells in Q2 2024 compared to Q1, and saw cost improvements.
• The company began vehicle testing of prototypes, including the Cybertruck, with in-house dry cathode 4680 cells, which could significantly reduce costs.
• While currently only for the low-production Cybertruck, Tesla aims for the 4680 cells to be cheaper than those from suppliers by the end of the year.
• Successful implementation of these cells could positively impact Tesla’s costs and the wider EV industry.

UK car production sees expected dip in 2024, but on track for 50% EV output by 2028

• New figures from the Society of Motor Manufacturers and Traders (SMMT) reveal that the UK built 416,074 cars in the six months to July – 34,094 fewer (7.6%) than in the same period last year.
• June itself saw a particularly sharp decline of 26.6% yoy.
• SMMT noted that the decline was “expected as manufacturers retool lines to make electrified models following some £23.7 billion of UK investment announced last year”.
• SMMT now estimates that the UK will produce around 910,000 cars this year, down 9.3% on 2023.
• Output will be back to 1.1m by 2028, with over 50% of output being EVs.

Last mile delivery fleets sees strong EV adoption in US

• The freight industry has seen a significant increase in EV adoption, with an 81% rise in US commercial fleets between 2022 and 2023, tracked by Geotab.
• A broader range of EVs, including vans and semi-trucks, is now available, offering more choices for fleet managers to suit different needs.
• Last-mile delivery and drayage fleets, which often operate within predictable, short distances and have extended downtime, are well-suited for EV integration despite broader challenges in charging infrastructure.
• Significant investments have been made in major freight hubs, including $150m in federal funds to ports in several US states for EV infrastructure upgrades.

BYD secures order for 120 electric buses from South Africa

• The Chinese automaker has been selected to supply SA with its first electric bus fleet.
• BYD signed an order with 163-year-old South African bus operator Golden Arrow to supply 120 electric buses in a push to electrify local public transportation.
• BYD expects to start delivering these electric buses to Golden Arrow in December this year and plans to complete delivery of all vehicles by the end of 2025.

Company News

Anglo American (AAL LN) 2,210.5p, Mkt Cap £29.7bn – H1 results include US$1.6bn write down of Woodsmith

• Anglo American reports what it describes as “a strong operational performance” and underlying EBITDA of US$5.0bn for the six months to 30^th June 2024 (2023 -US$5.1bn).
• Underlying earnings are lower at US$1.29bn (H1 2023 – US$1.67bn) with operating profits of US$1.5bn (H1 2023 – US$3.0bn).
• The company says that “Financial results were impacted by lower iron ore prices and sales, and the effect of the cyclone at Manganese, largely offset by higher copper prices, price-driven POC normalisation at PGMs and effective progress in our cost-out programmes”.
• Net debt at 30^th June is reported at US$11.09bn (1^st January 2024 – US$10.62bn).
• Copper operations were the largest contributor to EBITDA generation US$2.04bn (41%) pf the total (2023 – US$1.49bn – 29%) with iron ore adding a further US$1.41bn (28%) (2023 – US$1.78bn – 35%).
• The US$0.7bn “loss attributable to equity shareholders … [was] … impacted by a $1.6billion impairment of …[the] … Woodsmith … [polyhalite mine in Yorkshire] … due to the decision to slowdown the project’s development”.
• Commenting on the performance during H1, Chief Executive, Duncan Wanblad, confirmed that “We are on track to reduce our annual run rate costs by $1.7 billion and reduce capital spend by $1.6 billion over the 2024-2026 period. We are moving at pace to create a much more agile and structurally profitable mining company focused on our exceptional quality Copper and Premium Iron Ore businesses”.
• He clarified that “we expect to substantially reduce our overhead and other non-operational costs in phases, but weighted towards the end of the process to minimise business risk”.
• Mr. Wanblad also explained that “Our focus on operational performance is delivering results, most notably in our Copper and Premium Iron Ore businesses, with EBITDA margins* of 53% and 43% respectively. Copper is tracking well, Minas-Rio achieved its strongest first half production for several years, and Kumba continues to perform strongly while we work with Transnet on rail reliability”.

Arkle Resources* (ARK LN) 0.28p, Mkt Cap £1.6m – Update on Botswana Lithium as potential brine discovered

• Arkle, who hold exploration licences in Ireland, Botswana and Zimbabwe, report exploration progress in Botswana.
• The Company is looking for lithium in the Makgadikgadi Salt Pans, where their licences have shown potential for lithium brines.
• Today Arkle report they have completed four wide spaced Transient Electromagnetic lines over two of the Makgadikgadi exploration blocks.
• Initial analysis has shown a conductive layer averaging 30m deep, which Arkle considers to be brines.
• The Company will sample the brines for lithium content.

Conclusion: Early-stage exploration at Arkle’s Botswana lithium licences has identified a potential brine structure averaging 30m depth. Sampling is expected to begin imminently to gauge the lithium mineralisation in the prospective brines. We look forward to updates.

*SP Angel are Nomad and Broker to Arkle Resources

Centamin (CEY LN) 120p, Mkt Cap £1.5bn – Interim results report 53% dividend payout

• Centamin reports pre-tax profits of US$117.1m for the six months to 30^th June 2024 (2023 – US$114.8m) and a 9% rise in EBITDA to US$210.1m (2023 – 193.4m).
• The company has declared an interim dividend of US¢2.25/share which “represents 53% of the cash available for dividend payments”.  The dividend is payable on 27^th September.
• Gold production increased by 2% to 224,738 oz (2023 – 220,562oz) and sales declined by 5% to 209,269oz (2023 – 219,354oz) as a result of the timing of shipments resulting 22.381oz of unsold gold being retained at the Sukari mine, although improved gold prices saw H1 revenue rise 9% to US$464m (2023 – US$425m).
• Cash costs rose 17% to US$220m “primarily due to lower capitalisation of costs … [of waste stripping] … increased output from the underground and higher throughput in the plant”.
• Centamin is retaining its full year 2024 production guidance in the range 470-500,000oz “weighted towards H2” while unit are expected in the range on a cash basis US$700-850/oz and US$700-850/oz on an all-in-sustaining cost basis
• Full year capex guidance is maintained at US$215m, including US$112m of sustaining capital and US$103m “of non-sustaining capex, of which US$58m is allocated to growth projects”.
• Operationally, the company highlights the completion of feasibility work on the 1.9moz Doropo gold project in northeast Cote d’Ivoire as well as “success at our Eastern Desert Exploration (“EDX”) project with the continued drill out of the Little Sukari discovery”.
• Centamin’s Definitive Feasibility Study (DFS) for the Doropo gold project describes an investment of US$373m delivering a mine delivering an average of 167,000oz pa of gold (and 207,000oz pa over the first 5 years) over a 10 year mine life and generating an after tax NPV_8% of US$426m and IRR of 34%.
• The economic base case uses a gold price of US$1,900/oz.
• Drilling in the Eastern Desert will be expanded to a campaign of 20,000m of core and reverse circulation drilling to follow up initial results from a 16,000m programme released in January.

Fresnillo PLC (FRES LN) 595p, Mkt Cap £4.4bn – Q2 Production results as Saucito offsets Fresnillo weakness

• Fresnillo processed 590kt of ore over the period, producing 2.6moz Ag, 13.3koz Au, 6.4kt Pb and 11.3kt Zn.
• Ore processed fell 5.3% qoq, and 12% yoy for the quarter and 9.3% for the 1H24 yoy.
• Silver production fell 22.5% for the half yoy and 3.5% for the quarter qoq.
• Gold production increased through higher ore grade processed.
• The Company expects to process an average silver ore grade for the year between 160-180g/t and gold grades between 0.7-0.8g/t.
• Saucito silver production rose 11% qoq on higher volumes and improved silver ore grades.
• Saucito mine development rates tracking in line with plans.
• The Company has retained their guidance at 55-62moz Ag and 580-630koz Au, including silverstream.
• Silver equivalent ounces expected at 101-112koz.

Metals One plc (MET1 LN)– 0.93p, Mkt cap £3.05m – Norwegian drilling programme to start in August

• Metals One reports that helicopter-supported drilling is expected to start at the Råna Ni-Cu-Co Project in Norway during August under the operatorship of its partner, Kingrose Mining.
• The drilling, estimated at a total of 700m, will focus on two geophysical magnetic targets identified last year which are “down dip from mineralised nickel-copper-cobalt massive sulphide at surface”.
• The first target “is a 170m long, 100m deep steeply dipping zone … starting <30m below surface … [and where] …. Historical rockchip samples returned up to 1.6% Ni and 0.6% Cu”.
• The second target “is a 150m long by 50m deep, steeply dipping zone … starting from <20m below surface. There is sparse outcrop directly above the anomaly, but zones of disseminated sulphide in peridotite have returned up to 0.6% Ni and 0.6% Cu in historical rockchip samples 100m southwest along strike”.
• The company says that the targets show “the same geological, geochemical and geophysical signature as mineralised intercepts drilled elsewhere in the Rånbogen and Malmhaugen area during 2023”.

Conclusion: Drilling at the Råna project in Norway is expected to start in August. We look forward to results which are likely to be available in October or November.

Sovereign Metals* (SVML LN) 35.12p, Mkt Cap £206m – Dry mining trial completes ahead of hydraulic mining tests

(Sovereign currently holds 100% of the Kasiya project. The government has a right to a 10% free carry in the project. Rio Tinto recently increased their strategic interest to 19.8% for a total sum of A$59.3m)

STRONG BUY – Valuation 55p

• Sovereign Metals reports the successful completion of their dry mining trial at the Kasiya rutile and graphite mine in the east of Malawi.
• The free-dig test pit mined some 170,000m3 of soft and friable material down to 20m depth.
  • No blasting
  • Zero strip ratio
  • No crushing or griding required a the mine site
• Hydraullic mining using high-pressure water hoses as so successfully used at Kabwe (Base Resources) will start within weeks.
• The team are busy filling the 6m ltr water storage for the hydraulic mining with the facility now 80% filled.
• Dry mining trial. Looking at the photo of the dry mining pit:
  • Water table looks to be at around 10m in the dry mining trial pit but will vary according to the season.
  • The formation of the benches look ‘interesting’ in the wet areas but has not been a problem for mining with full geotechnical analysis confirming the size of the benches.
  • The bottom of the pit appears to have a degree of water in it some of which will be used for the hydraulic mining trial.
• We suspect the excavators and trucks have had a tough time working with the clay in the not-so-dry mining trial pit.
  • “test pit material will be processed through cyclones on-site for deposition testwork.”
• The trial mining area will be backfilled.
• Sovereign are also creating eight small rehabilitation demonstration pits to demonstrate multiple rehabilitation approaches. These can be seen in Figure 7.
• We suspect hydraulic mining will prove more successful given the clay in the material along with the presence of a degree of ground water.
• The work will go towards optimisation of the September PFS results shown below:

• •  Operating costs US$8.74/t mined (Op costs are ~$4.3/t for hydro-mining at Kwale in Kenya)
  • Total operating costs including royalties US$404/t of concentrate – FoB Nacala port, Mozambique.
  • Assumptions – pricing:
    • Rutile price US$1,484/t – average over the life of mine.
    • Graphite – US$1,290/t – average over the life of mine
  • NPV (8%) post-tax US$1,605m ,NPV (10%) post-tax US$1,205m
  • IRR of 28% ungeared
• Ilmenite: prices: Ilmenite concentrate prices have picked up in recent weeks to US$317-324/t for 46% Ex-VAT EXW China. Prices had fallen to ~$314/t in June from $333/t in April.
• Graphite: Flake graphite prices (-199 EXW China have picked up substantially since their low in May. Prices have risen to US $785-813/t from US$708/t in May.
• We note the Kasiya mine will likely produce a range of flake sizes as seen with most natural graphite output.
• Li anode potential: We believe Rio Tinto may be looking at processing graphite directly into Li battery anode material.

Conclusion:  The dry mining trial has been confirmed to work well. We await the trial hydraulic mining and expect both mining systems to work.

*SP Angel act as Nomad and broker to Sovereign Metals. The analyst has recently visited the Kasiya mine site. We highly recommend the Malawi coffee beans sold in Lilongwe airport.

Syrah Resources (SYR AU) A$0.27, Mkt Cap A$277m – Quarterly production results show Vidalia ramp up but cash balance slides

• Syrah reports quarterly results for the period to 30^th June 2024.
• The Company produced 24kt of graphite vs 11kt in the previous quarter.
• 145kt processed at an average grade of 20% TGC, with recoveries of 78%.
• Production rates reflect campaign operations, with Balama pausing operations on weak market demand.
• Throughput suffering from longer run times, with management seeing efficiency and cost control measures.
• C1 costs FOB to Nacala at US$460/t, with guidance retained at US$430-480/t at 20ktpm. .
• Balama operations to remain in campaign mode until natural graphite fine demand increases.
• Average sales price FOB Nacala at $615/t vs $522/t in the March quarter.
• Vidalia is seeing a ramp up in production volumes, with solid ramp up progress across each segment.
• Cash fell from US$99m to US$82m over the period.
• Graphite Market Update:
  • Domestic Chinese graphite production is modest whilst synthetic products are fuelling oversupply.
  • Demand levels for imported natural graphite is very low and bid prices ‘both domestically and for imports are below the cost thresholds for all producers.’
  • Export volumes returned to pre-export licence ban levels.
  • Robust coarse flake prices, whilst China importing of fines remains subdued.

No.1 in Base Metals: SP Angel mining team awarded No 1. ranking for Base Metals forecasting in LSEG Quarterly Starmine Award for Reuters Polls Q1 2024

No.1 in Copper:  “The winner of the 2020 Fastmarkets Apex contest for copper was the team at SP Angel comprising John Meyer, Sergey Raevskiy and Simon Beardsmore, with an accuracy score of 93.8%”

No1. In Gold:  “SP Angel’s trio took the top spot for the gold price prediction throughout the year, with an accuracy score of 97.59%”

The SP Angel team also ranked 1st in Palladium, 3rd in Tin and 5th in Silver in the fourth quarter of 2020

Analysts

John Meyer – John.Meyer@spangel.co.uk – 0203 470 0490

Simon Beardsmore – Simon.Beardsmore@spangel.co.uk – 0203 470 0484

Sergey Raevskiy –Sergey.Raevskiy@spangel.co.uk – 0203 470 0474

Sales

Richard Parlons –Richard.Parlons@spangel.co.uk – 0203 470 0472

Abigail Wayne – Abigail.Wayne@spangel.co.uk – 0203 470 0534

Rob Rees – Rob.Rees@spangel.co.uk – 0203 470 0535

Grant Barker – Grant.Barker@spangel.co.uk – 0203 470 0471

SP Angel                                                            

Prince Frederick House

35-39 Maddox Street London

W1S 2PP

*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)

+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.

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SPA is registered in England and Wales with company number OC317049.  The registered office address is Prince Frederick House, 35-39 Maddox Street, London W1S 2PP.  SPA is authorised and regulated by the UK Financial Conduct Authority and is a Member of the London Stock Exchange plc.

MiFID II – Based on our analysis we have concluded that this note may be received free of charge by any person subject to the new MiFID II rules on research unbundling pursuant to the exemptions within Article 12(3) of the MiFID II Delegated Directive and FCA COBS Rule 2.3A.19.

A full analysis is available on our website here http://www.spangel.co.uk/legal-and-regulatory-notices.html. If you have any queries, feel free to contact our Compliance Officer, Tim Jenkins (tim.jenkins@spangel.co.uk).

SPA research ratings – Based on a time horizon of 12 months: Buy = Expected return of more than 15%, Hold = Expected return between -15% and +15%, Sell = Expected return