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August 18th, 2023 | 08:00 CEST

Globex Mining, Deutsche Lufthansa, Rheinmetall: Share prices soar on the back of impressive deals

  • Mining
  • Gold
  • Copper
  • Aviation
  • armaments
Photo credits: Lufthansa Group

Globex Mining achieves several deal highlights: The exploration company receives CAD 2 million in cash from Agnico Eagle for a land purchase, with further opportunity for a growing asset. Over 23 months, an additional CAD 6 million is expected to flow to Globex Mining. Then follows an option agreement with Tomagold Corporation on a Canadian gold property at Gwillin Lake near Quebec. Total payments of six figures are due over the next four years. In addition, shares in Tomagold will be transferred to Globex Mining. While German Foreign Minister Baerbock was more conspicuous for flight mishaps, the Lufthansa Group achieved an adjusted EBIT of around EUR 1.1 billion in Q2/23. The subsidiaries SWISS, Austrian Airlines, Brussels Airlines, Eurowings and Lufthansa Technik also posted record results. Furthermore, Rheinmetall is also taking to the skies - now supplying drones to Ukraine.

time to read: 7 minutes | Author: Juliane Zielonka

Table of contents:

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    Globex Mining - Globex receives CAD 2 million cash payment from Agnico Eagle for Francoeur/Arntfield property purchase, with the prospect of another CAD 6 million in 23 months

    Globex Mining is a Canadian explorer who purchases mining properties and increases their value through successful exploration, options or partnerships. The Company continuously develops the areas for the production of raw materials and precious metals. Some areas are sold as projects to cooperation partners.

    Now the Company is pleasing its shareholders with several pieces of good news at once.**

    First, Globex has received a cash payment of CAD 2 million from Agnico Eagle for the purchase of the Francoeur/Arntfield property west of Rouyn-Noranda. This strengthens the Company's cash flow. Also, an additional CAD 6 million is expected to be received by Globex from Agnico Eagle within the next 23 months. Agnico Eagle Mines Limited is a Canadian gold producer with operations in Canada, Finland, Australia and Mexico, and exploration and development activities extending into the United States. Agnico is one of the major players in the mining industry. With a workforce exceeding 16,000 and gold production of 3.1 million ounces in the past year, this is another feather in the cap for Globex Mining's business model.

    An option agreement was also newly concluded. The signatory is Tomagold Corporation, which is optioning the Canadian Gwillin Lake gold property in Barlow Township, Quebec, with five claims. Tomagold has the opportunity to acquire 100% interest in the claims. In order to take advantage of this opportunity, Tomagold has committed to pay a total payment of CAD 130,000 spread over the next four years, subject to certain conditions.**

    Also, a share component of 625,000 company shares to be newly issued by Tomagold has been agreed upon. Further, Tomagold shares valued at CAD 100,000 are to be paid to Globex Mining in four annual blocks of shares valued at CAD 25,000, based on the Volume Weighted Average Trading Price (VWAP) in certain circumstances, as compensation.

    In addition, in this option deal, Tomagold commits to explore for gold and spend CAD 1,5 million on this project. Globex Mining secures 3% of all gold Tomagold finds in the area. Tomagold can reduce this 3% levy if they pay a one-time CAD 1.5 million cash payment to Globex Mining.

    Assays conducted by Globex Mining on the Gwillin Lake property indicate high-yielding gold and copper deposits. Some samples had measured as much as 57.1 g/t Au and 0.96% Cu over one meter in channel sampling.

    Globex has also sold 100% interest in six lithium claims in Fiedmont Township, Quebec, to Jourdan Resources Inc. For this property, Globex received a cash and share component from Jourdan. In addition, Globex will retain a 2% Net Smelter Return (NSR) royalty. Jourdan has the option to purchase half of this for CAD 1 million, adjusted for inflation, prior to the commencement of commercial production.

    All in all, these are quite promising deals. Especially considering the current market capitalization of Globex Mining of just CAD 44 million, the share could increasingly become the target of investors and bargain hunters.

    From a chart perspective, the stock has been in a wedge formation for months. With a breakout above the annual high at EUR 0.67, the way would be free up to the magic EUR 1 mark. Beyond that, even higher prices could indeed be attainable. With continued good news, this could be within the realm of possibility in a few months.

    Lufthansa Group sets out for new heights

    One member of the German traffic light coalition government stood out this week. Foreign Minister Annalena Baerbock, a member of the Green Party, planned a trip to Australia, New Zealand and Fiji to return an ancient sword, a fishing net and an ancient club. From August 13-16, the trip was scheduled to take place in Canberra, Australia, to return the objects to the Kaurna indigenous community. The objects were last exhibited at the Ethnological Museum in Leipzig, Germany. Their trip focused on climate issues in the three target countries. But the government plane did not play along. After a stopover to refuel in Abu Dhabi, the trip had to be aborted due to technical difficulties. During the journey undertaken on behalf of climate issues and the associated unsuccessful flight attempts, a total of 200,000 litres of unused kerosene were released into the atmosphere, resulting in approximately 500 tons of CO2 emissions.

    If only she had flown with Lufthansa. The German airline group is once again doing well in Q2/23. With continued strong demand for air travel and encouragingly high average yields, the Lufthansa Group generated an adjusted EBIT of around EUR 1.1 billion. These results are also reflected in the performance of its subsidiaries: SWISS, Austrian Airlines, Brussels Airlines, Eurowings, and Lufthansa Technik also set new records in the same quarter.

    The Lufthansa Group also completed no less than three strategically valuable M&A transactions this quarter.

    1. The divestment of the international catering business of LSG Group,
    2. The sale of the payment services provider AirPlus, and
    3. The acquisition of a minority stake in ITA Airways.

    The divestment of the catering business, the sale of AirPlus and the acquisition of shares in ITA Airways mark important steps in the Lufthansa Group's strategic focus on its core business.

    Another positive aspect is the reduction of the Group's net debt to below pre-crisis levels. This financial stability supports the future direction of the Company.

    Looking ahead, the Lufthansa Group is concretizing its annual outlook for 2023, with the Group expected to achieve an adjusted EBIT of around EUR 2.6 billion. This underlines the confidence in the Company's continued positive development. And perhaps some money will flow into the coffers from the lawsuit against the climate activists. "We intend to assert claims for damages on behalf of the affected airlines of the Lufthansa Group (Lufthansa, Swiss, Austrian Airlines and Eurowings). This applies to the airport blockades on July 13 in Düsseldorf and Hamburg, as well as on November 24, 2022 in Berlin," Lufthansa announced in response to an inquiry by NZZ. However, no action has yet been filed. Lufthansa shares are currently trading at EUR 8.62.

    Rheinmetall sends drones to Ukraine

    Modern technology made in Germany will support Ukraine's troops in defense against Russian aggressors. Rheinmetall AG will deliver a next-generation Luna drone system to Ukraine by the end of 2023. The LUNA NG unmanned aerial system (UAS) is composed of a ground control station that controls the drones. The currently awarded contract is valued in the low double-digit millions of euros. The LUNA NG system already has several thousand flight hours and has proven its effectiveness in operations with international customers.

    "Given the changing security situation, governments have made comprehensive decisions in the area of military procurement," explained CEO Armin Papperger at the presentation of the quarterly figures in Düsseldorf. "The implementation is imminent, which is already evident in our first significant orders received." The commissioned LUNA NG system for Ukraine is part of a comprehensive aid package provided by the German government in July 2023. The German Armed Forces are introducing the LUNA NG reconnaissance system with minimal modifications as the new "HUSAR" reconnaissance drone.

    Given the German government's support for Ukraine, the Düsseldorf-based company is focusing on the repair and operational readiness of older tanks. Rheinmetall has already sent 20 Marder infantry fighting vehicles from its stocks to the east, with another 20 to follow soon. The Company is not expected to send some 30 Leopard-1 main battle tanks, which were recently acquired from a Belgian company and are now undergoing technical upgrades, to Ukraine until 2024.

    According to the Company's figures, Rheinmetall generated sales of around EUR 1.5 billion from April to June, an increase of about 6% compared to the same period last year. The order backlog at the end of June 2023 amounted to EUR 30.1 billion, an increase of 17% YOY. The share is currently quoted at EUR 246.70.

    Globex Mining secures valuable mining properties and increases their value through exploration, options or partnerships. Considering the CAD 2 million cash payment received from Agnico Eagle for the Francoeur/Arntfield property purchase and the promising prospect of another CAD 6 million over the next 23 months, Globex's financial position has strengthened. This marks another successful milestone in the Company's business development. The new option agreement with Tomagold Corporation offers a lot of profit potential for both parties. Gold and copper deposits have already been discovered on the property by the Globex Mining company. And under the four-year contract, Globex will receive approximately 3% of Tomagold Corporation's gold discoveries. Lufthansa Group reported adjusted EBIT of around EUR 1.1 billion in Q2/23 thanks to strong demand and high average yields. Three valuable M&A transactions and net debt reduction allow the crane to soar to new heights. Rheinmetall will deliver a next-generation Luna drone system to Ukraine by the end of 2023. Further support with tanks financed by the German government and solid sales characterize its Q2/23 performance.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Juliane Zielonka

    Born in Bielefeld, she studied German, English and psychology. The emergence of the Internet in the early '90s led her from university to training in graphic design and marketing communications. After years of agency work in corporate branding, she switched to publishing and learned her editorial craft at Hubert Burda Media.

    About the author

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