Trident Royalties Share Discussion Threads

[pogue] 08/1/2024 07:17

Oh look CEO purchasing shares....

[zho] 04/1/2024 08:50

World's Largest Lithium Reserve Discovered Beneath California's Salton Sea

[bhartez] 02/1/2024 22:01

The vesting target price for the first set of options is 80p. Then it goes up by 10p each year for 5 years to 120p. The option exercise price is 50p. It’s in the accounts on pg.53

[pogue] 02/1/2024 21:22

The CEO did set this company up to be fair and the CFO has been buying shares recently. Its a large pay cheque but he has been delivering.

[husbod] 02/1/2024 20:16

Last word on the subject.The vesting price for the first set of options of 50p is hardly challenging either given that the share price was over this as recently as June 2023.It would be nice if AIM boards didn't see their companies as milk cows for their own enrichment.

[husbod] 02/1/2024 20:09

Hi pogue Sorry but I'm still so sore that the company wot used to own the Sonera mine (I'm now of a vintage that means the names of old obscure shares I used to own are difficult to recall) was sold on the cheap to what is effectively the CCP(Chinese Communist Party) that I view anything to do with that company with a jaundiced eye.You are of course correct about the escrow account..I am also quite a large holder of TRR but was somewhat surprised at how little skin the game our ceo has and what a high salary he enjoys.

[pogue] 02/1/2024 19:04

Love insinuating negatives dont you Husbod.
The money for Sonera is in an Escrow account and will come back there has never been any suggestion it wouldnt and from talking to the CEO and CFO I get the impression that is what will happen. They dont sound confident about it but if it had paid off it was a massive win. Kind of gamble that was worth a go.

[husbod] 02/1/2024 18:59

They might well have to accept that their putative royalty in the Sonera lithium mine in Mexico will have to be written off.Does anyone know if the Sonera lithium has any value in our current nav or is it just the amount we will (hopefully) get back if the royalty is terminated?

[husbod] 02/1/2024 18:54

Good point but presumably the market thinks the NAV is somewhat exaggerated and is also concerned about lithium prices.

[wbodger] 02/1/2024 17:14

The references to green energy battery metals worry me. It was always a risk to be too early into Lithium and so it has proved. Everyone is looking for alternatives, which might mean the sunny uplands never materialise. They should divest one of the Lithium plays and eat a loss, imo. It won't get better for a couple of years and one good Lithium play should be enough. There are better mining plays, eg Copper which remains the most important 'green' metal in both senses of the word.

[888icb] 02/1/2024 16:52

I think the Directors are being judged on the NAV rather than the share price over which they have less control. This extract from the last Simon Thompson article in September explains it:
“ Unwarranted share price discount to NAV
Trident’s share price is 10 per cent above my 37p entry point (Alpha Research: 'A lowly rated commodity and green energy inflation hedge’, 1 November 2021), but has drifted since my last buy call, at 49p (‘Trident is s smart call on battery metals’, 19 May 2023).

From my lens, the 41 per cent share price discount to NAV estimates is completely unwarranted given the diversification of the portfolio, potential to deploy $20mn of Trident’s free cash on further smart acquisitions to further boost future earnings, and the conservative-looking valuations of the group’s existing royalties. The group’s interim results will be released later this month and should bring these dynamics into sharp focus, too. Buy.”

[husbod] 02/1/2024 14:25

Very true but in the meantime he has to suffer the indignity of a meagre £650k annual salary and free bonus shares for underperforming the market.I do appreciate that he is building up a potentially very profitable company which is why I have bought a shedful of shares on the open market but I fail to see why he should get 99k free shares for last year's performance. The options at 50p and higher should be sufficient reward without getting free shares on the way.Unless of course he reckons the 50p target might be a bit further away than he was hoping.

[trader465] 02/1/2024 14:19

“they expect to be able to purchase pound notes for 50p coins”

Pound notes are extinct and worthless, they need to produce five pound notes

[888icb] 02/1/2024 14:16

If I remember correctly the Directors have some big share options but at much higher share prices starting above 50p and rising each year. They have to hit the share price to trigger the options. The Directors are very highly incentivised to to get the share price to £1+. They must be very frustrated at how the market has sent the share price in completely the wrong direction presumably due to lithium prices falling. Lithium is in the future and has no effect on current income so it’s perverse for the market to down value the company based on assets that won’t produce income for another two years. The gold royalties should produce even better this year than last year. Let’s hope todays 9% rise is the start of the rerate.

[1knocker] 02/1/2024 14:16

If I was getting a shedload' or even 'shell full' of free shares I am not sure iwould be buying any either. What I look for is management purchase options. It is instructive to see the share price at which they expect to be able to purchase pound notes for 50p coins!

[the count of monte_cristo] 02/1/2024 13:26

He's mining the company😅

[husbod] 02/1/2024 13:00

Shell was intended to be shedful- bloody predictive text.

[husbod] 02/1/2024 12:58

Watched a Shares mag presentation by Adam Davidson. All was very reassuring until question time when some awkward sod said he was watching Trident but needed to be persuaded to invest when he saw Davidson's salary of £650k and the fact that he only had a handful of shares. Hmmm I thought.Well that handful has now been increased by some 99k free bonus shares for a period when the share price has underperformed.So again he hasn't put his hand in his pocket and used any of that £650k to actually buy any shares.Hmmm I think again. Not exactly what I would expect of a ceo if he has faith in his company. He should set an example and buy a shell more.Bet that awkward sod hasn't bought any!

[bagpuss67] 31/12/2023 09:51

Nice to see this widely tipped and hope it plays out in 2024 snd beyond..

[pogue] 31/12/2023 09:44

Write up by Oakbloke on substack

Part of the article....

The share price has dropped a third this year on negative sentiment to Lithium. But 59% isn’t Lithium - and given that all the 41% Lithium are NON PRODUCING (yet) then the 1/3 reduction in the share price is even more insane! In fact, almost the same proportion (37%) as lithium is gold which is currently near record highs!!

Most of the gold holdings aren’t royalties but instead are offtakes. It’s worth understanding what an “offtake” is too. An offtake contract according to TRR is a contract pursuant to which the operator agrees to sell, and the purchaser agrees to buy, refined gold produced from the mine or mines over which the offtake is granted. Gold offtakes provide “royalty-like” exposure, where returns are driven by the volatility, production profile, gold price and exploration success but is insulated from capex or operating costs. The key commercial terms include those relating to the amount of gold to be purchased, the duration of the contract, and the payment terms. The purchaser has the right to purchase gold at the lowest reference price in a defined quotation period, which is typically 6-8 days. A positive margin can normally be made on the resale of the gold. The average margin is typically larger during periods of increased volatility and higher/rising gold prices.

The offtake portfolio generated US$6.1m of revenue for Trident during 2022 and is expected to grow significantly over the coming years.

For example, if you are a Gold Miner who has an offtake agreement with me. Let’s say Gold increases from $2000 to $2100 next week. The offtake gives me the right to buy 35%-100% of your gold at $2000 and sell it at today’s market rate = $2100. If you’re producing 1,000 ounces every week, and it’s a 100% offtake, I’ve just skimmed ($100x1000) so $0.1m from you….. in the space of a week. If gold drops the following week back to $2,000 I simply don’t buy any.

Conclusion:
Trident is an excellent opportunity to buy and have less risky exposure to minerals markets.

It is low risk and a great way to take advantage of net zero trends without mining risk. A great complement to the likes of Power Metal.

[zho] 30/12/2023 12:30

Trident Royalties made a loss in 2022, but it is expected to report a pre-tax profit of $8.4 million in 2023. More importantly, $16 million in cash is likely to be generated, helped by a reduction in receivables. In 2024, $11.5 million could be generated, although cash generated prior to working capital movements should double. Cash generation should really take off in 2025.

The share price has hardly changed from the start of 2021, yet the company is on the verge of being highly cash generative. This is an excellent opportunity to buy and have less risky exposure to minerals markets.

[robertspc1] 21/12/2023 16:07

Agree that the bearish lithium sentiment has taken its toll here. Not much management can do about that so they are focussing on what they can control. Long term I'm sure dividends will flow so will add on weakness

[1knocker] 21/12/2023 12:47

Lithium is a commodity I have many times been tempted by but (very fortunately so far) I have not taken any position in it or in any lithium producer. The price falls this year would lead one to suppose that it is virtually unsaleable at any price! One of the attractions of TRR for me was that the high power management here should know a lot more about it than i do, and will make a bit of money out of it. Time will tell.

To my mind, the 'coming of age' for TRR will be when it starts to pay a dividend. You can come up with just about any valuation for a royalty company's assets, so investors will (rightly in my view) always favour those royalty companies which pay an income, and especially those with a track record of increasing that income over time.