Baker Steel Resources Trust Ltd Net Asset Value(s) (3547R)
November 04 2021 - 05:30AM
UK Regulatory
TIDMBSRT
RNS Number : 3547R
Baker Steel Resources Trust Ltd
04 November 2021
BAKER STEEL RESOURCES TRUST LIMITED
(Incorporated in Guernsey with registered number 51576 under the
provisions of The Companies (Guernsey) Law, 2008 as amended)
4 November 2021
29 October 2021 Unaudited NAV Statement
Net Asset Value
Baker Steel Resources Trust Limited (the "Company") announces
its unaudited net asset value per share at 29 October 2021:
Net asset value per Ordinary Share: 97.7 pence
The NAV per share has increased by 0.7% against the unaudited
NAV at 30 September 2021, mainly due an increase in the carrying
value of Tungsten West Plc following its successful IPO on AIM
during the month.
The Company had a total of 106,462,502 Ordinary Shares in issue
with a further 700,000 shares held in treasury as at 29 October
2021 .
Investment Update
The Company's top 12 investments were as follows as a percentage
of NAV:
29 October 2021 31 December 2020
Bilboes Gold Limited 19.3% 19.5%
Futura Resources Ltd 16.4% 16.2%
Tungsten West Plc 15.9% 13.2%
Cemos Group plc 13.8% 14.5%
Polar Acquisition Ltd 8.7% 8.9%
First Tin Ltd 5.2% 3.9%
Mines & Metals Trading
Peru PLC/Silver X Mining
Corporation 4.1% 4.5%
Nussir ASA 4.0% 3.4%
Kanga Potash 2.7% 2.7%
Azarga Metals Corp 2.6% 2.7%
Prism Diversified 1.6% 1.5%
Metals Exploration plc 1.5% 1.9%
Listed Precious Metal Shares 1.8% 3.9%
Other Investments 1.9% 2.4%
Net Cash, Equivalents and
Accruals 0.5% 0.8%
Tungsten West Plc (Tungsten West)
Tungsten West commenced trading on the AIM market of the London
Stock Exchange during October 2021 following an IPO at 60p per
share raising GBP39 million. The target amount to be raised was
GBP25 million, however the Board of Tungsten West, on which the
Company is represented, decided to accept additional applications,
as the increased equity raising provides extra contingency in case
of capital overruns or delays or otherwise reduces the amount of
loan than will need to be drawn down thereby reducing the financing
risk of the project. As a part of the IPO, the Company's
convertible loan was converted into ordinary shares such that the
Company is now Tungsten West's largest shareholder with 15.35% of
its issued shares.
As one of 4 founders the Company has been issued options over a
total of 4,971,585 shares. The options are exercisable in three
equal tranches for a nominal amount dependent on certain corporate
milestones being achieved. The milestone for the first tranche was
the IPO and is therefore immediately exercisable. The second
tranche is exercisable when the Hemerdon mine is fully financed to
production, which should be achieved once the various conditions
precedent to the US$49 million royalty and loan facility from Orion
Resource Partners (UK) LLP are fulfilled. This is expected in the
first half of 2022. The third tranche is exercisable on commercial
production at Hemerdon, expected in 2023.
As the Company is a substantial shareholder in Tungsten West,
its shareholding is subject to a one year lock-up in accordance
with AIM rules. The Company using a Black Scholes option valuation
methodology is carrying its Tungsten West shares at a 25% discount)
to the 29 October 2021 market bid price on AIM, albeit this
discount should decrease as the time remaining on the lock-in
reduces. The carrying values of tranches 2 and 3 of the options are
discounted further to allow for the risk of the milestones not
being achieved.
Tungsten West is the 100 per cent. owner and operator of the
historical Hemerdon tungsten and tin mine located near Plymouth in
southern Devon, England. The Hemerdon Mine represents the world's
third largest tungsten mineral resource, with a JORC Code (2012)
compliant Mineral Resource Estimate of approximately 325Mt at 0.12
per cent. WO(3) . Tungsten West identified a number of reasons
which it believes contributed to the failure of the previous
operations at the Hemerdon Mine and has devised a new operating
plan which aims to remedy these to enable it to recommence
operations with significantly improved operational efficiencies and
financial profitability.
Tungsten West's financial model estimates planned capital
expenditure and corporate commitments of GBP44.6 million for
improvement works at the Hemerdon Mine. It has an estimated 18.5
year life of mine, generating a NPV(5%) of GBP272 million and an
IRR of 45 per cent. The ramp up in production is planned to
commence in Q4 2022, reaching steady state production within eight
months, when operations are expected to produce approximately
3.5ktpa WO(3) and 388tpa Sn generating an average of GBP34 million
EBITDA per annum over the life of the Hemerdon Mine.
The Company is pleased to have been instrumental in Tungsten
West's formation and the acquisition of the Hemerdon Mine, which
promises to be an important strategic producer of tungsten outside
of the main producing country, China. The Company's average cost in
acquiring its equity position was approximately 20.3p per Tungsten
West share compared to the closing bid price of 70p on 29 October
2021 and 76p on 2 November 2021.
Further details of the Company and its investments are available
on the Company's website www.bakersteelresourcestrust.com
Enquiries:
Baker Steel Resources Trust Limited +44 20 7389 8237
Francis Johnstone
Trevor Steel
Numis Securities Limited +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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