REG - Golden Prospect Prec Golden Prospect-GPSS - Monthly Investor Report - September 2024

Golden Prospect Precious MetalsAnnouncement

28/10/2024 07:00

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RNS Number : 7428J  Golden Prospect Precious Metals Ltd  28 October 2024

 

 

Golden Prospect Precious Metals Limited

 

Monthly Investor Report - September 2024

 

The full monthly factsheet is now available on the Company's website and a
summary can be found below.

 

NCIM - Golden Prospect Precious Metals Ltd - Fund Page
(https://ncim.co.uk/golden-prospect-precious-metals-ltd/)

 

Enquiries:

 

For the Investment Manager

CQS (UK) LLP

Craig Cleland

0207 201 5368

 

For the Company Secretary and Administrator

Apex Administration (Guernsey) Limited

James Taylor

0203 530 3600

 

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Fund Description

 

The objective of the Golden Prospect Precious Metals Fund is to provide
investors with capital growth from a group of companies in the precious metals
sector.

 

Portfolio Managers

 

Keith Watson and Robert Crayfourd.

 

Key Advantages for the Investor

·      Access to under-researched mid and smaller companies in the
precious metals sector

·      Potential inflation protection from precious metals assets

·      Low correlation to major asset classes

 

Key Fund Facts(1)

 

 Total Gross Assets:  £46.66m
 Reference Currency:  GBP
 Ordinary Shares:     85,503,021
 Net Asset Value:     47.79p
 Mid-Market Price:    39.75p
 Net gearing:         9.3%
 Discount:            (16.82%)

 

 

Ordinary Share and NAV Performance(2)

 

                One Month  Three Months  One Year  Three Years  Five Years
                (%)        (%)           (%)       (%)          (%)
 NAV            4.53       13.68         50.76     2.03         24.62
 Share Price    10.42      21.37         67.72     (1.24)       27.00

 

 

Commentary(3)

 

Precious metals sustained positive momentum through September, with gold
gaining 5.2% and Silver 8.0% over the month. Despite Sterling's relative
strength, with a rise of nearly 2% against the dollar, the Fund NAV rose 4.5%
in September. This is compared to sterling returns of 3-4% for the GDX and
GDXJ ETFs and less than 1% for the Gold Bugs Index and Philadelphia Gold and
Silver Index.

 

With gold continuing to make all-time highs and inflationary cost pressures
for the miners easing, equities should show further margin improvement in the
forthcoming Q3 reporting season, maintaining improving trends in the Q2
results. The sector is now experiencing some of the highest free cash flow on
record, which could incentivise increased M&A by established producers as
they look to grow or replace reserves. Reflecting the pick-up in
profitability, many large gold producers continue to guide a pickup in
dividends and share buybacks, which we believe should support investor
confidence.

 

Gold's latest leg higher has been primarily driven by a return of Western
investment demand, most clearly represented by known physical ETF holdings
which posted a fourth consecutive month of increases in September. Given
easing inflation data globally, the primary driver is lower interest rate
expectations, with the 50bps cut by the US FED providing a supportive tailwind
for the sector's performance.

 

We have previously noted the strong Chinese demand as a driver of gold price.
However, this appears to have softened lately in response to the higher price
and stimulus discussions in China, as evidenced by the negative Shanghai
premium.

 

Volatility over the next month may remain elevated ahead of the US
Presidential election in November. With polls moderately tied, a Trump win
would likely see a more supportive backdrop for gold, as a more volatile
geopolitical world could incentivise central banks to de-dollarise reserves
and add gold to reserves.

 

That said, the strong performance of precious metals and related equities led
to more concentrated portfolio positions. As a result, the Fund took some
profits in Ora Banda and West African Resources over the month. Some proceeds
were reinvested into a placement for UK-listed Greatland Gold after they
acquired a mill and the outstanding working interest in their Havieron mine,
located in Australia, from Newmont.

 

 

                                            Gross Leverage(5)  Commitment Leverage(6)

                                            (%)                (%)
 Golden Prospect Precious Metals Limited    114                114

 

 

 

 

CQS (UK) LLP

4th Floor, One Strand, London WC2N 5HR, United Kingdom

T: +44 (0) 20 7201 6900 | F: +44 (0) 20 7201 1200

 

CQS (US), LLC

152 West 57th Street, 40th Floor, New York, NY 10019, US

T: +1 212 259 2900 | F: +1 212 259 2699

 

Tavistock Communications

18 St. Swithin's Lane, London EC4N 8AD

T: +44 20 7920 3150 | goldenprospect@tavistock.co.uk
(mailto:goldenprospect@tavistock.co.uk)

 

Sources: (1,2) CQS as at the last business day of the month indicated at the
top of this report. Performance is net of fees and expenses. New City
Investment Managers took over the investment management function on 15
September 2008. These include historic returns and past performance is not a
reliable indicator of future results. The value of investments can go down as
well as up. Please read the Important Information section at the end of this
document. (3) All market data is sourced from Bloomberg unless otherwise
stated. The Fund may since have exited some / all the positions detailed in
the commentary. (5) For methodology details see Article 4(3) of Directive
2011/61/EU (AIFMD) and Articles 6, 7, 9 and 10 of Delegated Regulation
231/2013. (6) For methodology details see Article 4(3) of Directive 2011/61/EU
(AIFMD) and Articles 6, 8, 9, 10 and 11 of Delegated Regulation 231/2013.

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