REG - Baker Steel Res.Tst. - Net Asset Value(s)

Baker Steel Resources TrustAnnouncement

09/07/2024 07:00

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RNS Number : 5783V  Baker Steel Resources Trust Ltd  09 July 2024

BAKER STEEL RESOURCES TRUST LIMITED

(Incorporated in Guernsey with registered number 51576 under the provisions of
The Companies (Guernsey) Law, 2008 as amended)

 

9 July 2024

30 June 2024 Unaudited NAV Statement

Net Asset Value

Baker Steel Resources Trust Limited (the "Company") announces its unaudited
net asset value per share at 30 June 2024.

Net asset value per Ordinary Share: 81.0 pence.

The NAV per share at 30 June 2024 increased by 1.8% versus the unaudited NAV
at 31 May 2024 largely due to increases in the carrying values of Cemos Group
plc and the Bilboes royalty as a result of the half year review of unlisted
holdings summarised below. These increases outweighed falls in the listed
prices of Caledonia Mining and Silver X and a reduction in the carrying value
of Kanga Investments.

 

The Company had a total of 106,462,502 Ordinary Shares in issue with a further
700,000 shares held in treasury as at 30 June 2024.

 

Investment Update

 

The Company's top 10 investments were as follows as a percentage of NAV:

 

                                     30 June 2024  31 December 2023
 Futura Resources Ltd                34.2%         36.3%
 Cemos Group plc                     30.6%         29.3%
 Bilboes Royalty                     7.9%          7.2%
 Tungsten West Plc                   4.4%          1.7%
 Caledonia Mining Corporation Plc    4.1%          5.4%
 Nussir ASA                          3.8%          4.1%
 Metals Exploration Plc              3.5%          3.0%
 Silver X Mining Corporation         3.4%          3.5%
 First Tin PLC                       2.1%          2.1%
 Kanga Investments Ltd               1.5%          3.6%
 Other Investments                   2.7%          3.4%
 Net Cash, Equivalents and Accruals  1.8%          0.4%

 

Half Year Review of Unlisted Investments

 

The Company has carried out its usual half yearly review of general market
movements in mining equities, taking into consideration company-specific
factors, as well as an assessment of whether these should impact the carrying
values of its unlisted holdings.

 

The Investment Manager maintains an index of comparable listed companies for
each unlisted investment for comparison purposes and as a benchmark against
which the valuation of a particular unlisted stock might have moved during the
period had it been listed which it terms "IndexVal". In addition, the
Investment Manager has updated its royalty models for the royalty interests it
owns in Futura Resources, Bilboes Holdings and Polar Acquisition Limited to
take account of the latest estimated production profiles of the underlying
projects and consensus commodity prices. The net present values produced by
these royalty models are then discounted for development risk to arrive at a
valuation.

 

Cemos Group plc ("Cemos")

 

The shares in Cemos are valued on the basis of a multiple of EBITDA when
compared to listed Moroccan cement producers, suitably discounted. Sales in
2023 were down largely due to decreased economic activity in the area that
Cemos operates. 2024 has seen a recovery in sales and together with Cemos
being well underway in constructing its own compact calcination unit (CCU),
has resulted in an 11% increase in the carrying value of Cemos.

 

The CCU will enable Cemos to produce its own clinker and supplementary
cementitious materials, the principal raw materials in cement production. This
will not only provide security of supply of clinker but should materially
reduce costs as well as lowering the carbon footprint associated with cement
production. Commissioning of the calcination plant is expected to take place
in the fourth quarter of 2024 with the full benefit realised from 2025
onwards.

 

 

Futura Resources Ltd ("Futura")

 

Futura commenced production from its Wilton mine in March 2024. Results on
steel making coal quality and recoveries have been encouraging but more data
is required before reducing the development risk discounts applied to the
models can be considered. Accordingly, the valuations of both the equity and
royalty for Futura have been left unchanged.

 

Subsequent to the period end, Futura has agreed an A$35 million offtake
finance arrangement with an international trading company. This will enable
Futura to start the development of its second mine, Fairhill, which is
expected to be in production in the fourth quarter of 2024. As this agreement
was signed after the end of June 2024, it was not taken into account in the
mid-year valuation which will be reviewed once more at the year-end in
anticipation of both mines reaching full production in 2025.

 

 

Other

 

The model for the Bilboes net smelter gold royalty has been updated to reflect
the revised gold production profile announced by Caledonia Mining at the
beginning of June 2024 as well as the increase in the gold price during the
year. This resulted in a 16% increase in the carrying value of the Bilboes
royalty. Kanga Investments has continued to have good interest in attracting
potential partners to acquire or finance the Kanga potash project but has
struggled to attract short term financing to fund working capital and as a
result the carrying value has been reduced by 46% until such time as a
definitive transaction is achieved.

 

 

Further details of the Company and its investments are available on the Baker
Steel website www.bakersteelcap.com (http://www.bakersteelcap.com)

 

 

Enquiries:

Baker Steel Resources Trust Limited             +44 20 7389 8237

Francis Johnstone

Trevor Steel

 

Deutsche Numis
 
            +44 20 7260 1000

David Benda (corporate)

James Glass (sales)

 

The Net Asset Value ("NAV") figure stated is based on unaudited estimated
valuations of the underlying investments and not necessarily based on
observable inputs. Such estimates are not subject to any independent
verification or other due diligence and may not comply with generally accepted
accounting practices or other generally accepted valuation principles. In
addition, some estimated valuations are based on the latest available
information which may relate to some time before the date set out above.

 

Accordingly, no reliance should be placed on such estimated valuations and
they should only be taken as an indicative guide. Other risk factors which may
be relevant to the NAV figure are set out in the Company's Prospectus dated 26
January 2015.

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