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Ryan Jackson, CEO, Newlox Gold Ventures Corp.

Ryan Jackson
CEO | Newlox Gold Ventures Corp.
60 Laurie Crescent, V7S 1B7 West Vancouver (CAN)

info@newloxgold.com

+1 778 738 0546

Newlox CEO Ryan Jackson on building a green gold producer with a rapid growth trajectory


Nick Mather, CEO, SolGold PLC

Nick Mather
CEO | SolGold PLC
1 King Street, EC2V 8AU London (GB)

emichael@solgold.com.au

+44 20 3823 2125

SolGold CEO Nick Mather on building a major gold and copper mining company


Jared Scharf, CEO, Desert Gold Ventures Inc.

Jared Scharf
CEO | Desert Gold Ventures Inc.
4770 72nd St,, V4K 3N3 Delta (CAN)

jared.scharf@desertgold.ca

Desert Gold Ventures CEO Jared Scharf on West Africa and its potential


18. September 2020 | 09:00 CET

BHP Group, Newcrest Mining, SolGold: Getting bogged down or putting all your eggs in one basket

  • Gold

When it comes to investing in commodity companies, the BHP Group is a household name. The British company is active worldwide, mining coal, iron ore, copper and other commodities and has long been considered a solid dividend earner. But recently the company has disappointed: Special effects put pressure on profits, unrest in Chile made life difficult for BHP and the Corona pandemic also left its mark: the bottom line at the end of the financial year at the end of June was a profit of no less than EUR 6.75 billion. While the mood among investors was not particularly good, BHP cut its dividend by around ten percent, thus spoiling shareholders’ sentiment even further. On a year-on-year basis, the share price fell by around 1.4%. In view of the good performance of copper following the outbreak of the pandemic, this is too little for many investors.

time to read: 3 minutes by Nico Popp


Nick Mather, CEO, SolGold PLC
"[...] We knew the world was rapidly electrifying and urbanising and needing significant amounts of copper to do so. [...]" Nick Mather, CEO, SolGold PLC

Full interview

 

Author

Nico Popp

At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.

About the author


Is the BHP Group buying into price fantasies?

Nevertheless, there are also positive things to report about BHP. The company already successfully implemented cost-cutting measures during the past fiscal year and thus became even more profitable. It can also be assumed that the recent positive development of many raw material prices will not be felt until the current fiscal year. Even though BHP itself has a cautiously positive outlook for the future and expects economic activity to vary greatly from region to region, investors see no potential for surprises in the share price. It is possible that, as in the past, acquisitions will help BHP to get off to a good start.

Newcrest profits from the gold bull market only to a limited extent

When it comes to mergers and acquisitions, the name Newcrest Mining is always mentioned in the resource industry. The company is Australia's largest gold producer and increased its profits to USD 647 million in the past fiscal year. In recent months, it has been repeatedly rumoured that the company is on the radar of North American resource companies as a potential takeover target. Around 85% of Newcrest Mining’s production is gold, with copper being another important raw material. Although the dividend at Newcrest is traditionally lower than at BHP, the Australian company recently increased its dividend by 14%.

Despite this positive signal to the market, the share price remains at a low level - on a twelve-month horizon, the share price even lost 4.6%. Tragic detail: Newcrest has sold forward parts of the production of its Telfer mine in Australia until 2022/23 and is not benefiting from rising gold prices there.

SolGold: Net asset value of flagship project significantly exceeds market value

In contrast, the SolGold share has profited from the development since March. The share has a price yield of more than twenty percent on a one-year horizon. In this context, it is interesting to note that both BHP Group and Newcrest Mining are involved in SolGold. The former company holds 13.5% and the latter 9.9%. The company is focused on the exploration for gold and copper in the Ecuadorian Andean Belt. SolGold has been active in this region since 2012 and has secured numerous mining concessions in recent years. The idea behind SolGold's strategy is that the geological characteristics are similar to those in Chile, where many international resource companies are already active.

SolGold pursues a very concentrated strategy in Ecuador: While other companies focus on different locations, SolGold prefers to use the known characteristics of a region to its advantage and to develop projects quickly. In addition to the flagship Alpala project, for which a feasibility study is scheduled to be completed by mid 2021, the company has 13 other projects that are being explored with high priority. As Nick Mather, CEO of SolGold recently stated in an interview, the net present value of Alpala already amounts to USD 4.4 billion and clearly exceeds the market capitalization of SolGold - the company is currently valued at market cap at around EUR 600 million. Initial studies on the flagship project, which were prepared before the gold boom, envisage a possible mine life of more than fifty years and a payback period of four years.

Investors have the choice: stability or growth

Although SolGold is an exploration company and therefore speculative, the extensive portfolio in Ecuador offers promising opportunities for investors. The company regularly reports drilling results and keeps investors informed about new developments. The existing holdings of large companies in the industry, such as Newcrest or the BHP Group, also speak for themselves. Although the shares of the established companies offer stability and indirectly also a participation in the success of SolGold, speculative investors may well be interested in the emerging company.


Author

Nico Popp

At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.

About the author



Conflict of interest & risk note

In accordance with §34b WpHG we would like to point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH may hold long or short positions in the aforementioned companies and that there may therefore be a conflict of interest. Apaton Finance GmbH may have a paid contractual relationship with the company, which is reported on in the context of the Apaton Finance GmbH Internet offer as well as in the social media, on partner sites or in e-mail messages. Further details can be found in our Conflict of Interest & Risk Disclosure.


Related comments:

21. October 2020 | 11:45 CET | by André Will-Laudien

Newmont, AngloGold Ashanti, Velocity Minerals - Gold runs bright

  • Gold

Physical gold inventories have increased steadily over the past decades and are currently at their highest levels. Namely because gold, unlike other raw materials, is practically indestructible and is not consumed except in small quantities in medicine or high-tech. As a result, the global amount of gold is continually increasing. The supposedly highest gold reserves are in the USA, where the government claims to have about 8,133 tons or 287 million ounces. Germany has the second-largest amount of gold reserves with 3,417 tons or 120 million ounces, followed by the International Monetary Fund with 3,217 tons (113 million ounces). The gold price has experienced a sharp increase in recent years. After exceeding the USD 1,000.00 per ounce mark for the first time in March 2008, it had already reached just over USD 2,000.00 per ounce by mid-2020. Investors can invest in the precious metal through derivatives, ETCs, mining stocks, or physical gold.

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13. October 2020 | 13:34 CET | by André Will-Laudien

Bayer, Barrick, Desert Gold: In Gold we trust!

  • Gold

The global economy moving at different speeds. In the USA, the ISM index for services is once again expanding slightly. In China, the mood in the service industry is once again pointing to a veritable recovery. In the eurozone, the economic sentiment examined by the analyst firm, Sentix, remains robust but without any new highs. Even with the rising infection rate, the pandemic will come to an end eventually. In Germany, economic data such as industrial orders, production, and exports, showed a slight slowdown in August. Nevertheless, the stock markets are swinging to new heights daily, as the latent threat from the infection necessitates further liquidity packages from governments. This monetary policy continues to imply very low-interest rates, a weakening USD, and rising inflation expectations. This environment should keep the demand for precious metals at least at a high level, so we remain on the lookout.

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07. October 2020 | 11:45 CET | by Nico Popp

Nornickel, Newcrest Mining, Triumph Gold: Which stock benefits from rising gold prices?

  • Gold

While the price of gold is slowly but surely picking up speed again, many investors are asking themselves with which share they will best profit, from rising precious metal prices. Many investors initially think of stocks such as Rio Tinto or BHP Billiton - but these companies are virtually not involved in the mining of precious metals. To profit from rising prices, investors must take a closer look. At first glance, Nornickel's stock seems to promise more of an investment in a producer of industrial metals. Still, the company also has many precious metals on offer - platinum and palladium account for more than 40% of the commodities produced. More critical are nickel and copper with a share of almost 50%. Gold and silver are only by-products.

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