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Matthew Salthouse, CEO, Kainantu Resources

Matthew Salthouse
CEO | Kainantu Resources
3 Phillip Street #19-01 Royal Group Building, 048693 Singapore (SGP)

info@krl.com.sg

+65 6920 2020

Interview Kainantu Resources: "We hold the key to growth in the Asia-Pacific region".


Justin Reid, President and CEO, Troilus Gold Corp.

Justin Reid
President and CEO | Troilus Gold Corp.
36 Lombard Street, Floor 4, M5C 2X3 Toronto, Ontario (CAN)

info@troilusgold.com

+1 (647) 276-0050

Interview Troilus Gold: "We are convinced that Troilus is more than just a mine".


John Jeffrey, CEO, Saturn Oil + Gas Inc.

John Jeffrey
CEO | Saturn Oil + Gas Inc.
Suite 1000 - 207 9 Ave SW, T2P 1K3 Calgary (CAN)

info@saturnoil.com

+1-587-392-7900

Saturn Oil + Gas CEO John Jeffrey: "Acquisition has increased production by 2,000%"


03. September 2021 | 11:51 CET

Deutsche Rohstoff, K+S, Royal Dutch Shell - Where to invest as fund managers cut equity exposure?

  • Oil
Photo credits: pixabay.com

A look at the Global Fund Manager Survey conducted by Bank of America shows the views of Fund managers have changed significantly in the past month. Only 27% now expect the global economy to be strong, compared with almost twice as much optimism the previous month. One reason is the expectation that the FED will noticeably turn off its monetary tap at the end of the year. The money glut has sparked inflation, which can be seen clearly in commodity prices. All these are reasons why the cash quota in the funds is being increased, and the equity quota decreased. The high commodity prices are benefiting commodity producers in particular, which is why we are looking at three companies from this sector today.

time to read: 4 minutes by Armin Schulz
ISIN: DT.ROHSTOFF AG NA O.N. | DE000A0XYG76 , K+S AG NA O.N. | DE000KSAG888 , ROYAL DUTCH SHELL A EO-07 | GB00B03MLX29


John Jeffrey, CEO, Saturn Oil + Gas Inc.
"[...] The Oxbow Asset now delivers a substantial free cash flow stream to internally fund our impactful drilling and workover programs. [...]" John Jeffrey, CEO, Saturn Oil + Gas Inc.

Full interview

 

Author

Armin Schulz

Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.

About the author


Deutsche Rohstoff - Strong figures and expansion of oil production

The month of August held plenty of good news for Deutsche Rohstoff investors. The first was the listing of Almonty Industries, in which Deutsche Rohstoff holds 12.2% of the shares, on the Australian stock exchange ASX on August 2. The listing and the associated capital increase pave the way for the largest tungsten mine outside China. It is expected that this will significantly increase the value of the investment.

On August 5, the excellent half-year figures were presented. With sales of EUR 38.8 million, EBITDA of EUR 39.9 million was reported. The main contributors were oil production and income from the investment portfolio, which generated earnings of EUR 36.8 million. Another highlight is the reduction in debt from EUR 92 million at the end of 2020 to EUR 59 million. With the repayment of the bond and a loan in July, debt was reduced by a further EUR 22.8 million.

Then, at the end of August, Bright Rock Energy, a subsidiary of Deutsche Rohstoff, became active in Wyoming and Utah. On August 25, it was announced that it would begin drilling in Wyoming. The investment is approximately USD 9 million, and the first production of oil is scheduled for December. Drilling is already underway in Utah, and as announced on August 30, development is now accelerating. It is expected to produce 1,500 barrels of oil equivalent per day in the first quarter of 2022. The USD 18 million investment should pay for itself within 1-2 years.

In addition to oil and gas, the Company also has interests in tungsten, gold and lithium. The investments made during the Corona Crisis were all positive for the Company's performance. The stock has already been on an upward trend since early 2021. Future investments have been made so that further growth of the Group can be assumed.

K+S - Reduces debt

Potash prices have once again reached record levels. At the beginning of 2021, the price in Brazil was USD 250 and has now reached USD 720 per ton. With such an increase, consolidation will also set in sooner or later. However, this should not affect K+S so strongly. Through the sale of the salt business in the USA, many debts have been paid off. The Group's earnings have also improved significantly due to the high price of raw materials. That means that debts can be reduced even more quickly. As experts expect demand for fertilizers to remain high, the business will also be buoyant for the foreseeable future.

Since August 11, the share price has plummeted from EUR 13.23 to EUR 10.90. At EUR 11, there was a double bottom, which also held. Since August 19, the share has been climbing again. According to Bloomberg, based on the special income from the sale of the salt business, a net profit of EUR 4.96 per share could be achieved. At the current share price of EUR 12.25, this results in a price/earnings ratio (P/E) of 2.5. If the special effect is excluded, a P/E ratio of around 5.2 remains, assuming earnings per share of EUR 2.37. The current valuation is, therefore, favorable. The ratio would look even better if the Group were debt-free.

Royal Dutch Shell - Strengthens sustainability

The oil price has risen significantly this year. Royal Dutch Shell has also benefited from this, but they have had to change their focus to achieve the required climate targets since the Amsterdam ruling. Whether the oil price can remain at this high level remains to be seen. On the one hand, demand has been rising since the Corona pandemic subsided, and on the other hand, OPEC is once again producing more oil. How the Delta mutation will affect demand remains to be seen. As long as there are no more lockdowns, demand should remain stable.

The Group is trying to optimize its carbon footprint through new business units. The subsidiary Sarawak Shell Berhad is developing Timi natural gas project, which will be powered by solar and wind energy. Together with CoensHexicon, a floating wind farm is being built in Korean waters with a capacity of 1.4 gigawatts. In the UK, 50,000 charging stations for electric cars are to be built in the coming years. Existing road infrastructure is to be used for this.

The world will not get along without oil for a long time yet, and the profits will be put into renewable energies and e-mobility. This transformation will take time. The share has been running sideways between EUR 15.50 and EUR 17.80 since the beginning of July. The current dividend yield is about 4.8%. If you are not a dividend hunter, you should wait for the effect of the OPEC production volume increase. In addition, due to Hurricane Ida, the Norco production site is without power.


All commodity suppliers can look back on the year to date with satisfaction. The increase in raw material prices has led to good results almost across the board. Deutsche Rohstoff is very diversified with its oil production, tungsten, gold and lithium. K+S seems to have managed the turnaround from debt, partly thanks to a sharp rise in the potash price. Royal Dutch Shell is in the transformation phase and will remain a significant oil producer in the long term, but is now also increasingly focusing on sustainability.


Author

Armin Schulz

Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.

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.


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