Trident Royalties Share Discussion Threads

[888icb] 08/5/2024 08:08

Buy recommendation from Simon Thompson:
“ A discounted smart way to play precious metals

This commodity royalty group is trading on a near-50 per cent discount to un-risked net asset value

May 7, 2024
by Simon Thompson
Royalty and offtake revenue up 21 per cent to $9.5mn
Pre-tax profit of $3.8mn reverses prior year loss of $4.6mn
Buoyed by profits on disposals, gains on asset revaluations and a higher royalty and offtake income, commodity royalty group Trident Royalties (TRR:36p) moved back into profit last year.

The sale of pre-production gold royalties to mining giant Franco-Nevada Corporation (CA:FNV) realised $15.8mn of cash proceeds, representing a 143 per cent return on capital, and highlights the value Trident is creating for shareholders.

Moreover, management continues to develop its gold offtake portfolio, holding offtake contracts over 10 mines, which accounted for almost three-quarters of group revenue in 2023. Since the year-end, Trident has announced positive news on two projects in the top-tier gold mining jurisdiction of Ontario, Canada.”
There is a lot more and this is the concluding part:
“ Well-funded
In February 2024, Trident entered a new $40mn revolving credit facility with an option to increase it to $60mn. The interest rate is SOFR (the replacement for Libor) plus a margin of 2.5-4.5 per cent (depending on leverage ratios), resulting in annual interest savings of $1.3mn once fully drawn.

Trident has net debt of $22mn, a sum equating to 20 per cent of shareholders’ funds, so it has ample headroom to fund new investments. Furthermore, the increasing royalty income is generating bumper operating cash flow, so much so that Tamesis estimates net debt will fall to $10.5mn by the year-end.

True, the 80 per cent decline in the LCE price in the past 18 months has dented investor sentiment. This is the key reason why the share price has pulled back to my entry point (Alpha Research: 'A lowly rated commodity and green energy inflation hedge’, 1 November 2021) even though 12 of the group’s 21 assets are now producing cash flow including a valuable gold offtake portfolio valued by Tamesis at $78.9mn (21.2p). Rated on a 50 per cent discount to unrisked NAV estimates, Trident shares are worth buying.”

[ukgeorge] 07/5/2024 11:59

Okay thanks.

[the deacon] 07/5/2024 11:42

Volatile prices are much more useful. As mentioned earlier, TRR pocket the difference between the lowest and highest price of gold in a given time frame.

[888icb] 07/5/2024 10:50

Note the comment from the analyst above:
“ We expect both ounces and margins to lift into Q2, based on first gold production from the Greenstone mine and the high gold price volatility in the quarter so far,"

[the deacon] 07/5/2024 10:36

A little underwhelming today. Mimbula ramping up is very welcome. Seems to have been a long hard slog there. Shame Lincoln isn't more meaningful in order to take advantage of the higher gold price. The offtake portfolio is a steady earner, but isn't going to be much more than that as its a margin clipping exercise. Lots going on in the pipeline - which is where the real returns will come for TRR. Happy to wait.

[888icb] 07/5/2024 10:30

Liberum analysts remain optimistic about Trident Royalties PLC's (AIM:TRR, OTCQX:TDTRF) performance moving into the second quarter following today’s first-quarter results.

"We expect both ounces and margins to lift into Q2, based on first gold production from the Greenstone mine and the high gold price volatility in the quarter so far," they commented.

These comments come after Trident’s royalty revenues dipped to $2.98 million, marking a 6% decrease from the previous quarter, primarily attributed to a significant 24% reduction in gold offtake ounces.

Despite this, Liberum noted that the impact was cushioned by robust margins per ounce achieved during the period.

Trident shares remain a buy with a slightly redacted price target of 72p from 74p against a 38.55p publication price

[robertspc1] 03/5/2024 09:12

Punchy buy first thing. Will add on weakness etc

[the deacon] 02/5/2024 15:08

Good to see Trident doing the North American mining media rounds. Trevor has a good following..https://twitter.com/TridentPlc/status/1785992883444842586?t=Znrus_DrUO4hWogibBSBnQ&s=19

[the deacon] 02/5/2024 10:19

I agree the board are on the ball. They've shown some great 'out of the box' thinking since inception. Nevertheless, the landscape has changed somewhat with the cost of capital being so much higher. Royalty companies didn't have many problems when they could borrow at ultra low rates - that's changed now, and the accretive bar is that much higher. As previously mentioned, there's some decent projects in the portfolio, especially TP which is truly a world class asset. I'm bot overly enamoured by the gold offtake portfolio (I just think pure royalty/streams are that much cleaner in terms of sitting back and collecting a cheque), but in order to provide TRR with income the offtakes are doing their job. I've been invested here since ipo, and I've every confidence Adam and team will be very successful. It is a waiting game that requires some patience

[jammytass] 02/5/2024 09:19

this is not a one trick pony the bod are on the ball!!

50p year end

[robertspc1] 02/5/2024 09:01

I like this as a geo political hedge. But seems like there are plenty of sellers around preventing a sustained rise

[mwj1959] 02/5/2024 08:19

I agree...on the share price hitting 50p, unless we see a massive jump in the lithium price or a transformational transaction that massively dilutes the jam tomorrow (2027) Thacker Pass exposure.

[the deacon] 02/5/2024 08:10

Doubtful. Tbh i was quite underwhelmed by what I read. Mimbula still struggling. Good pipeline, but serious cash flow still quite some way off.

[jammytass] 02/5/2024 08:08

good update 50p this year

[robertspc1] 29/4/2024 21:03

Commodities on the rise and big acquisition activity. This has been left behind. Hopefully a catalyst soon to get things moving

[ukgeorge] 25/4/2024 22:19

EVs are too good not to take over. Went to Lisbon on Monday ev taxi in the morning, driver said £15 to fill it up does 250miles, enough for the day.In Lisbon lots of EVs one byd had a range 600km he said less for motorways, but it only takes 20 mins to charge from 20% to 80%. Had done 140k km in a couple of years. They make so much sense. Lithium prices fingers crossed will come back up :)

[nil of] 25/4/2024 08:29

Lots of good royalties in the portfolio but they have bet the shop on Lithium. So maybe the copper and gold assets pushes it forward a bit but unless the lithium price moves it’s hard to see it as exciting until production of lithium gets closer and Tesla laying off 10% of its workforce and profits plunging ain’t a great backdrop for the EV market.It’s an EV fund for now

[mwj1959] 20/4/2024 17:33

Agreed. Jam tomorrow for a big chunk of the portfolio not sufficient in the current environment to move the share price. One for the (very) patient!

[lurker5] 20/4/2024 15:52

The market doesn't 'appreciate' anything at the moment. It wants to see delivery, not hopes. Affecting miners particularly. It won't 'appreciate' TRR for another year.

[nickelmer] 18/4/2024 17:14

Lithium America's issue new shares at 25% discount to enable faster development of Thacker Pass project, should be positive for Trident if production dates are brought forward.

[donald pond] 18/4/2024 12:28

Copper continues to be very strong. TRR must be seeing a step change in revenues

[carcosa] 16/4/2024 19:20

Maybe of interest to some:



Wall Street Journal takes an inside look at two projects that are seeking to change the mineral supply chain, the Thacker Pass Lithium Mine in Nevada and the Tamarack Mine in Minnesota.

[bo doodak] 14/4/2024 02:01

Interesting comments re Ford and GM.