August 16th, 2021 | 12:04 CEST
Freenet, Deutsche Rohstoff, Palantir - The clock is ticking
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"[...] China's dominance is one of the reasons why we are so heavily involved in the tungsten market. Here, around 85% of production is in Chinese hands. [...]" Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG
Transformation takes time
A permanent switch from fossil fuels to renewable energies is on the agenda of all parties. The CDU and CSU, for example, want to push ahead with the expansion of renewable energies to meet the rising energy demand. It includes energy generation from the sun and wind, biomass, hydropower, geothermal energy and hydrogen. Accordingly, Germany is to become the number 1 hydrogen country someday!
However, the status quo is currently different. The global population is growing, and with it, the demand for raw materials for energy production. For the next few years, the world will still be powered by oil. Alternative energy sources such as wind and solar energy still have a long way to go before they have the necessary capacity to reliably supply a large part of the global economy with power.
Strong first half
When Deutsche Rohstoff AG announced its final figures for the first half of the year, it showed that good business could be done with black gold in 2021 and certainly in the years to come. The Mannheim-based Company's sales rose to EUR 38.8 million, with EBITDA of EUR 39.9 million and consolidated net income of EUR 17.5 million. As announced in the preliminary figures, oil and gas production in the USA was around 16% above forecasts at the end of May. As a result, forecasts for both sales and EBITDA for the full years 2021 and 2022 have been revised significantly upwards.
In addition, the securities portfolio, which was built up at bargain prices with oil and gas and gold stocks in the first half of 2020, continued to deliver unbudgeted earnings. In Q4 2020 and the first half of the current year, a total of EUR 15.3 million was realized, with EUR 11.7 million in the first 6 months of 2021. As of June 30, EUR 5.8 million in unrealized gains were still on the books. As a result, cash and cash equivalents have grown to around EUR 71.3 million. Net debt has been reduced to EUR 59 million, compared with a still high EUR 92 million at the turn of the year.
The CEO, Dr. Thomas Gutschlag, is optimistic about the further development of Deutsche Rohstoff: "The further development of our share will, of course, depend to a large extent on the oil price. We share the assessment of many analysts that the oil price is fundamentally well supported." Management also sees positive signs for gold and gold shares. Analysts at Kepler Chevreux see the stock at EUR 20. First Equity Research is even more optimistic, giving the buy rating a price target of EUR 24. Currently, Deutsche Rohstoff AG is trading at EUR 16.90.
With the gold of the future, data, the analysis Company Palantir does not yet earn money, but the growth continues unabated. Thus, in the second quarter, revenues of USD 375.64 million were generated, which equates to a growth of just under 50%. The operating result amounted to minus USD 146.15 million. The adjusted operating margin was 31%. After a loss of USD 0.17 per share in the previous year, the result improved to minus USD 0.07. The Company was able to achieve its ambitious targets. That means that the Company's ambitious forecast exceeded both sales and operating margin.
The share price reacted to the figures with double-digit gains. The breakout above the EUR 23.50 mark has cleared the way to the next resistance at EUR 27.50. The share price is now in danger of falling.
The publication of the figures for the second quarter caused the Freenet share price to take a beating. In terms of EBITDA, the Hamburg-based Company was above analysts' estimates at EUR 113.50 million. At the same time, revenues of EUR 619.90 million were below the consensus of experts, who were forecasting EUR 625 million. The increase in the annual estimate, with EBITDA expected to be between EUR 430 million and EUR 445 million, did nothing to help the share price head south. It is now imperative that the mark in the area of EUR 19.90 holds. Otherwise, there is a threat of a further fall towards the lows for the year at around EUR 17.
Even if the politicians push the climate targets further forward, the change from fossil fuels to renewable energies takes time. Deutsche Rohstoff shone with strong figures due to better than expected oil business. Palantir also delivered, while Freenet fell short of analysts' consensus estimates.
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