Energy & Materials Sector

• I tally 48 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• Six new deals this week: Amcor (AMC AU)takes out Berry Global (BERY US);Sayona (SYA AU)and Piedmont (PLL AU) merge; and Integrated Design & Engineering  (9161 JP)‘s TOB. 
• Key updates/news took place on: Arcadium Lithium (LTM AU), Pacific Smiles (PSQ AU), Hotel Property Investments (HPI AU), HKBN (1310 HK), Xingda International (1899 HK), and Malaysia Airports Holdings (MAHB MK).

Sayona Mining is a lithium producer and explorer with projects in Canada, Western Australia and soon in the US and Ghana. A proposed merger of equals with Piedmont Lithium will create a c A$1bn mid-tier lithium player with streamlined asset ownership and significant growth optionality. Sayona and Piedmont’s Canadian and US projects comprise one of the largest advanced hard rock lithium resources in North America and are strategically positioned to supply the region’s growing lithium demand. Following the proposed equity raises, the company will be well capitalised to execute on its growth plans. As a producer, Sayona should also benefit strongly from inevitable recovery in lithium prices, with additional upside coming from the potential downstream expansion.

• Steep dip of 30.6% in NR exports month-on-month in Sept
• Ivory Coast’s infusion touches an abysmal share of 14.9%
• Rubber glove exports to be worth a record RM13.7 billion in 2024

• For the week ending 15/Nov, US crude inventories rose by 0.5m barrels, exceeding expectations of a 0.4m barrel increase. Gasoline stocks exceeded estimates, while distillates declined less than expected.
• US natural gas inventories fell by 3 Bcf for the week ending 15/Nov, contrasting analyst expectations of a 2 Bcf buildup. Inventories are 6.4% above the 5-year seasonal average.
• TD Cowen raised its PT on Exxon, while Morgan Stanely lowered its PT on Halliburton. Aramco and Sinopec began the construction of a refining and petrochemical complex in China.

• Enterprise Products Partners L.P. recently reported its financial results for the third quarter of 2024, presenting a mixed bag of operational achievements and persisting challenges that are crucial for investors considering the company’s prospects.
• In the financial spectrum, the company experienced a growth in adjusted EBITDA, marking a rise from $2.3 billion in the previous year’s third quarter to $2.4 billion.
• This increment underscores the company’s capability to generate earnings despite fluctuations in market conditions.

• Lanxess has seen a decline in share price due to various factors, but recent developments indicate a potential return on investment of over 30% in the next 3 years
• CEO Matthias Zachert has focused on selling off cyclical and competitively disadvantaged businesses to focus on higher value-added products, strengthening the company’s position
• Lanxess received a significant cash inflow from the sale of Currenta and Warren Buffet’s 3% stake in the company shows confidence in its transformation and future potential

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Sealed Air Company recently held its third quarter earnings call for 2024, highlighting several strategic changes and the financial outlook for the firm.
• The company is advancing its restructuring efforts by reorganizing into two distinct verticals: Food and Protective.
• This reorganization is intended to better align the company’s operations with market demands and customer needs, as well as to enhance shareholder value.

• Valero Energy Corporation recently disclosed its financial performance for the third quarter of 2024.
• The earnings report highlighted various aspects of the company’s operational and financial status, presenting a mixed set of results impacted by significant maintenance activities and a challenging margin environment.
• During the quarter, Valero’s refineries operated at 90% of their throughput capacity, in line with previous guidance, despite a period of heavy maintenance.

• The Arcadium Lithium (ALTM US) scheme meeting relating to Rio Tinto Ltd (RIO AU)’s US$5.85 offer is on 23 December. The transaction is expected to close in mid-2025.
• The high current 12.3% spread reflects risk related to regulatory and shareholder approvals. The numerous required regulatory approvals pose a risk to completion and/or timing.  
• Despite depressed lithium prices, the offer remains unattractive on several fronts. Blackwattle, which opposes the offer, could rally others to force a bump. Rio conceding to a bump is uncertain. 

• Straits Trading (STRTR SP) is a conglomerate-investment company with diversified investments in resources, real estate and hospitality.
• Straits Trading’s key growth engine is its real-estate arm – Straits Real Estate (SRE) which has a diversified property portfolio across different geographies and various sectors.
• Despite fluctuations in STC’s earnings, the company continues to pay stable dividends to its shareholders. As at the end of June 30, 2024, Straits Trading generated cash and bank balances of SGD476.4m. STC continues to generate positive cash from operations.

• Back on the 9th October, Rio Tinto Ltd (RIO AU) reached an agreement to buy Arcadium Lithium (LTM AU/ALTM US) for US$5.85/share (~A$8.70/share), a ~90% premium to undisturbed.
• The proxy statement is now out, with a Scheme Meeting scheduled for 23 December. The transaction is expected to close in mid-2025. The long stop is the 9th October 2025.
• Trading wide-ish at a gross spread of 11.9%, reflecting the timing to secure regulatory approvals – notably from China – as opposed the Offer Price being viewed as opportunistic.

• The Drill: Could nuclear be the next Trump bet?
• This week’s The Drill examines commodities in the aftermath of Trump’s election, where calm has begun to return as risks were initially overestimated.
• Nuclear energy is likely an underappreciated theme in the new Trump administration, while tariff threats appear overblown.

• Solaris Resources (SLS CN) announced sweeping changes to its management and ties to Canada. It will also spin-off some of its exploration targets in a new company.
• While its listing will remain in Canada for now, its physical presence in the country will cease and operations will be run out of Switzerland, Ecuador and Peru.
• The shake-up is an answer to the Canadian government’s decision earlier this year blocking Chinese Zijin Mining Group Co Ltd H (2899 HK) from making an investment in Solaris.

• Vicat is a mid-sized global cement, aggregates, and ready-mix concrete operator with operations in 12 countries, primarily in developed markets.
• Despite its strong presence in the industry, Vicat has traditionally traded at a discount compared to its European peers, but the discount has widened significantly in recent years.
• With a solid balance sheet and attractive valuation metrics, Vicat’s equity is currently trading at historically cheap levels, presenting a potential investment opportunity for investors.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Ovintiv Inc. showcased robust operational and financial performance in its 2024 third-quarter results, underscoring both strengths and areas for cautious consideration.
• The company reported net earnings of $507 million, equivalent to $1.92 per share, along with cash flow of $978 million, or $3.70 per share, which surpassed consensus expectations.
• This was primarily attributed to production exceeding the upper end of guidance ranges for all product categories, coupled with cost efficiency driving performance.

• ~11 high impact appraisal/exploration wells will be drilled on various licences in Namibia over the coming months.
• This is very material and is expected to attract the attention of investors.
• Sintana provides exposure to three out of the six licences with high impact drilling.

• Petroleo Brasileiro S.A., commonly known as Petrobras, has reported its Q3 2024 results, outlining several key operational and financial highlights.
• On the operational front, Petrobras continues to make significant strides in its exploration and production activities.
• The company has successfully started operations on two FPSOs (Floating Production Storage and Offloading), namely Maria Quitéria and Marechal Duque de Caxias, with further developments expected in the Búzios field through the Almirante Tamandaré FPSO.

• Packing giants Amcor Limited (AMCR US/AMC AU) and Berry Global Group (BERY US) announced they will combine in an all-stock transaction, with a ~63%/37% ownership split (respectively) in the MergeCo.
• Amcor will issue 7.25 Amcor shares for each Berry share, for a US$73.59/share implied price. US$650mn of benefits from identified cost, growth and financial synergies by end of third year.
• Closing, subject to shareholder and reg approvals, is targeted in the middle of 2025. The transaction has been unanimously approved by the boards of both Amcor and Berry.

• Orla Mining acquired by Newmont in $850 million deal with production assets in Mexico and development assets in the United States
• Orla Mining has strong shareholder support including PL mining 10% of the company, Fairfax, Newmont, and Agnico
• Muscle White mine in Canada has a 6.23 grams per tonne reserve grade with a reserve life until 2030, operating at 1 million tonnes per annum with high recoveries and FIFO operated mine with camp upgrades in progress

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• US natural gas prices rose 5.77% for the week ending 15/Nov, buoyed by forecasts of cooler weather, rising US LNG exports, and declining production.
• Henry Hub Put/Call volume ratio sharply rose to 1.08 from 0.65 (08/Nov) the previous week as put volumes rose by 53.5% WoW, while call volumes fell by 7.0%. 
• Call OI increased for December, January, February, and March expirations, while put OI was substantial for November, April, May, June, and July contracts.

• WTI futures dropped 4.77% for the week ending 15/Nov, pressured by a bleak demand outlook, a rising dollar, and weak economic data from China.
• WTI options Put/Call volume ratio rose to 1.00 from 0.66 (08/Nov) last week, as call volume dropped by 57.3% WoW and put volume fell by 35.4%.  
• WTI OI PCR climbed to 0.86 from 0.77 (08/Nov) last week. Call OI fell by 37.9% WoW, while put OI fell by 29.9%.

• FY24 GUIDANCE WAS REVISED.
• POST FY24 GROWTH SCENARIO REMAIN UNCHANGED.

• Halliburton Company reported its third-quarter 2024 earnings showcasing mixed performance, with total company revenue reaching $5.7 billion.
• While the international sector showed promising expansion, particularly in the Middle East/Asia region which grew by 9% year-over-year to $3.3 billion, the North American market exhibited a downturn with a 9% year-over-year revenue decrease to $2.4 billion.
• The adjusted operating margin was pegged at 17%, an indication of Halliburton’s consistent cost management and pricing strategies in an unstable market environment.

• There were no surprises in the 3Q24 accounts.
• Since last week, WI production has increased from 12.5 mbbl/d to 13 mbbl/d.
• Gross production in Gabon continues to be ~40 mbbl/d.

• Rubber Meet spots Risk Center, EUDR, industry academy as priorities
• RAOT delegation holds talks with APROMAC top brass
• Ivory Coast cup lump exports ban to stay, says APROMAC official

• U.S. Energy (NASDAQ: USEG) is an independent energy company historically focused on the acquisition and development of oil and natural gas producing properties in the U.S. In June 2024, the company acquired acreage in Montana with the goal of extracting and marketing helium products and other industrial gases.
• Going forward, the primary focus will be on the development and operation of helium and other industrial gases, along with the development of carbon sequestration capabilities.
• The company has no debt and $21.15 million in available liquidity.

• Capitan Silver is focused on resource growth at its high-grade Cruz de Plata silver project in Durango, Mexico.
• The Jesus Maria Silver Zone is the Company’s clear focus, having recently consolidated the land along strike of the multiple parallel high-grade silver veins, CAPT looks to expand these zones with drilling.
• The project is showing early signs of a district-scale silver deposit.

• North American hard-rock lithium plays Piedmont Lithium (PLL AU) and Sayona Mining (SYA AU) are to combine in all-stock merger with a ~50%/50% ownership split on a fully diluted basis.
• Sayona will be the ultimate/surviving parent, via issuing 5.27 Sayona ordinary shares for each Piedmont share. Various equity raisings will also take place, before and after the merger.
• EGMs for both Sayona and Piedmont shareholders are expected to be held in 1H25, with expected completion also in the 1H25. 

• SGX Iron Ore Futures dropped to USD 96.71/ton, down USD 5.49/ton, hitting a low of USD 96.30/ton amid pressure from declining housing prices and industrial output in China.
• Chinese portside inventories increased by 120k tons WoW to 148.51m tons last week, while average daily port discharge volumes rose by 131k tons WoW to 3.18m tons.
• Despite weak economic data from China, SGX Iron Ore Futures may rebound in November-December as pre-Lunar New Year restocking boosts steel demand.

• Compass Minerals Inc. recently reported its second-quarter fiscal 2024 results.
• The quarter demonstrated significant challenges, primarily attributable to unseasonably mild winter weather conditions across North America.
• The Salt segment, a core part of the company’s operations, was notably affected by these conditions, leading to a substantial decrease in deicing salt sales volumes, ultimately reflecting a 14% decline in segment revenue and a 7% drop in adjusted EBITDA compared to the previous year.

HELLENiQ ENERGY’s Q324 results were held back by a weak refining environment, as previously guided by the company, but showed an impressive operational performance. The company noted that the Q424 refining margin is likely to be $2/bbl to $3/bbl above the average for Q3. Q3 refining sales volumes of 4.163m tonnes were up 8% y-o-y, adjusted EBITDA of €183m was down 54% y o y and adjusted net income of €49m was down 77% y-o-y. HELLENiQ’s Q324 benchmark refining margin declined to $3.6/bbl, from $5.5/bbl in Q224, as anticipated by the company at the Q2 results, and at its lowest level since 2021. HELLENiQ announced a €0.2 per share dividend to be paid in January 2025, implying an interim yield of c 3.0%. Management was more confident on the Q424 outlook, expecting a better market and potentially some progress on its DEPA and ELPEDISON business associations that might continue the streamlining of the group.

Nanoco has issued a circular recommending that shareholders vote against both resolutions being proposed by Milkwood in its requisition for a general meeting (scheduled for 11:30am on 13 December 2024). We summarise the board’s key arguments below.

• What you need to know: • EDG announced assay results for five drill holes as part of its 10,000m 2024 drill program; it has completed 26 holes (7,303m) to date.
• • Today’s results continued to confirm strong mineralization in the untested gaps between Eagle & Imperial (Crown Zone), intersecting bonanza grade.
• • Two of five holes intersected significant intercepts (147.5 g/t Au over 1.0m and 7.61 g/t Au over 5.7m).

• 3Q24 update. TMC’s income statement expenses rose from $12.5 million in 3Q23 to $20.0 million in 3Q24 on higher legal and consulting costs, and share-based compensation accounting.
• However, quarterly cash use slowed from $12.5 million in the year-ago period to $5.7 million and management reaffirmed its intention to reduce cash use to less than $5 million/quarter once the ISA exploitation application is submitted for review.
• Submission date set. TMC initially intended to submit its NORI- D application to the ISA before the end of 2024 or before the first ISA meeting in 2025 (scheduled for March).

• European natural gas market facing uncertainty due to potential end of Russian gas flows through Ukraine
• North American LNG supply delays causing imbalance in global market
• Price relationship between summer 2025 and winter 2526 dependent on weather, supply sources, and storage refill mandates

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Secure Energy Services (SES) operates in the waste management and energy services industry, focusing on recurring revenue and pipeline businesses.
• The company has potential for growth through acquisitions, with a strong focus on tuck-in acquisitions in the metals recycling sector.
• Despite potential risks such as safety concerns and regulatory changes, Secure Energy Services has a strong dividend yield, free cash flow yield, and growth prospects, making it an attractive investment opportunity.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• The Ministry of Finance has decided to end the 13% export tax rebate on copper effective December 1st, 2024. Copper semi-producers rely on this rebate to remain profitable. 
• Copper semi-producers might rush to sell their inventory by 1st December when changes take effect, which may affect prices and distort differentials on the SHFE-LME. 
• As long-term bulls, we like Southern Copper (SCCO US); under 100 USD/share, it is worth exploring. We also believe a long LME short SHFE trade in the short-term could work.  

• OPEC cut its 2024 demand growth forecast by 5.7%, marking the fourth consecutive monthly downgrade, while the EIA and IEA raised their forecasts by 7.6% and 7%, respectively.
• Although the EIA and IEA raised 2024 demand projections, they lowered 2025 estimates. They anticipate an oversupplied oil market in 2025, with supply growth expected to outpace demand.
• The EIA raised Q4 2024 oil price forecasts on geopolitical tensions and inventory withdrawals but cut post-Q2 2025 estimates due to expectations of rising inventories from higher output.

• The US oil and gas rig count fell by 1 to 584 for the week ending on 15/Nov, after remaining steady for three weeks in a row.
• For the week ending 08/Nov, US oil production inched down to 13.4m bpd after remaining at 13.5m bpd for four consecutive weeks.
• US energy producers added two rigs in New Mexico and one in Pennsylvania while cutting two rigs in Texas and one each in Oklahoma and Utah.

• Albemarle Corporation’s Q3 2024 earnings demonstrated strong execution with volumetric growth in its Energy Storage division and year-over-year EBITDA growth in its Specialties and Ketjen segments.
• The company’s liquidity and leverage metrics are strong, with Albemarle maintaining leverage well below covenant limits and demonstrating operating cash conversion of over 100%.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• EOG Resources’ third-quarter results for 2024 reflect a strong financial and operational performance, marked by substantial free cash flow and a commitment to returning value to shareholders.
• The company generated $1.6 billion in adjusted net income and produced $1.5 billion in free cash flow.
• Notably, EOG has redistributed $1.3 billion of this cash back to shareholders, a strategy underpinned by a 7% increase in its regular dividend and an expanded share repurchase authorization by $5 billion.

• Marathon Oil Company recently reported its earnings for the first quarter of 2024, where several key insights about the company’s financial and operational achievements were shared.
• The company has maintained a strong financial and operational performance, reinforcing its position within the Energy and Petroleum sector.
• One of the highlights from the first quarter is Marathon Oil’s financial strategy, focused primarily on returning shareholder value.

• Alamos Gold Inc.’s third-quarter 2024 earnings presented a comprehensive review of the company’s operational and financial performance following its recent acquisition of the Magino mine from Argonaut Gold.
• This acquisition has significantly shaped the latest results, which reflect a mixed bag of outcomes from this transitional phase.
• The third quarter marked a record production milestone for Alamos, with 152,000 ounces of gold produced.

• Consortium appeals to farmers not to sell below INR 200/kg
• Supply to market expected to fall by 30% in coming days
• Compound rubber imports go up by 47.5% YoY until Sept

• With one trading day left in the review period, we expect one change with China Merchants Securities Co Ltd (H) (6099 HK) replacing Yankuang Energy Group (1171 HK) in December.
• Capping will result in selling for Meituan (3690 HK) and buying in Tencent (700 HK) and Alibaba Group Holding (9988 HK). 
• Short interest has jumped on both stocks, but the increase is far higher in China Merchants Securities Co Ltd (H) (6099 HK) compared to Yankuang Energy Group (1171 HK). 

• The Chemours Company’s third-quarter 2024 results present a mixed picture, reflecting both commendable strategic implementation and ongoing market challenges.
• The quarter witnessed a 1% increase in consolidated net sales to approximately $1.5 billion, driven by a 5% rise in volume, though partially offset by a 3% decline in pricing and a slight currency headwind.
• This reflects the company’s effective operational execution and successful navigation through previous disruptions, evidenced by year-over-year volume growth across all business segments.

• Cleveland-Cliffs presented its third-quarter 2024 results during a challenging period of weaker steel demand and pricing, largely attributed to reduced automotive production and high interest rates affecting consumer decisions.
• The company’s acquisition of Stelco, a Canadian steelmaker, was a notable development during this period, promising operational agility and cost efficiency.Cleveland-Cliffs reported a quarterly adjusted EBITDA of $124 million on 3.8 million tons of shipments.
• This was a decline from previous performance levels, which the company attributed to reduced activity in the automotive industry.

• Energy Transfer’s third quarter of 2024 results reveal several positive developments alongside some challenges, reflecting a complex operating environment.
• Financially, Energy Transfer generated an adjusted EBITDA of $3.96 billion compared to $3.54 billion in the same quarter of the previous year, indicating growth driven by record volumes across its pipelines and strong performance in crude and NGL exports.
• Despite the improved EBITDA, distributable cash flow attributable to partners remained flat at $1.99 billion year-over-year.

• Permian Resources delivered a robust performance in the third quarter of 2024, characterized by significant production gains and operational efficiencies.
• The company increased its full-year oil production guidance for the third time this year, highlighting a rise in daily production by 11,000 barrels over the initial forecast set in February.
• A substantial part of this increase is attributed to the outperformance of its core operations, coupled with effective execution in mergers and acquisitions, notably the successful integration of the Barilla Draw acquisition.

• Western Midstream Partners’ third quarter of 2024 report presents a mixed bag of operational achievements and financial challenges.
• Under the new leadership of Oscar Brown, the company continues to pursue its strategic goals while navigating through a complex market environment.
• On the operational front, Western Midstream Partners reported a commendable quarter characterized by strong customer service and maintaining over 98% operability despite increased plant turnaround activities.

• LyondellBasell Industries recently held its earnings call to discuss the financial results of the third quarter of 2024.
• The earnings report provides several insights into the company’s financial health, market positioning, and strategic advancements.
• The third quarter results indicate how LyondellBasell is navigating a challenging market environment marked by fluctuations in raw material costs and subdued demand in various sectors.

• In Q3, TotalEnergies beat revenue forecasts by 6.4% but missed EPS estimates by 3.7%. Revenue and adjusted net income fell by 2.8% YoY and 37%, respectively.
• TotalEnergies’ average liquids price realisation fell 2.4% YoY, European refining margins dropped 84.7%, while LNG price realisation rose 3.7% YoY.
• TotalEnergies’ Q3 cash flow fell 27% YoY to USD 6.8 billion. It announced USD 2 billion in Q4 buybacks and a 0.79 euro/share interim dividend.

• BP’s revenue declined 11.3% YoY, missing estimates by 4.3%, while EPS fell 27.8% YoY, beating estimates by 3.8%. Underlying net profit dropped 31.2% YoY to USD 2.3 billion.
• BP’s Q3 performance was impacted by weak oil prices, lower refining margins, and soft trading results, leading to its lowest underlying net profit since Q3 2020.
• Total upstream production rose 3% YoY, with liquids production up 5%. BP also achieved 80% YoY growth in its EV charging business, selling 1 terawatt-hour of electricity globally.

• FET’s refinanced balance sheet and free cash flow potential position the company to consider alternatives to return cash to shareholders in 2025.
• Proceeds from a $100 million issuance of 10.5% senior secured bonds, together with cash on hand, funded the repayment of the seller term loan and will be used to fund the redemption of the remaining 2025 notes on December 8, 2024.
• The new notes have a tack-on feature in the indenture allowing for the issuance of up to $150 million of incremental notes.

• Cumulative Q3 FY12/24 revenue grew 20.4% YoY to JPY14.9bn, with operating profit up 115.2% YoY to JPY3.1bn.
• Revenue from optical sheets for laptops and tablets increased, while revenue from clean energy materials declined 2.9% YoY.
• Full-year FY12/24 targets revised upwards, but 2H forecasts lowered due to policy changes and increased costs.

• Gross production at Dussafu has now reached 40 mbbl/d, taking Panoro’s overall WI production to 12.5 mbbl/d from 9,401 bbl/d in 3Q24.
• Production could grow further with two wells to be completed by YE24.
• A Ruche well is also set for first oil in 4Q24.

• 3Q24 production was 15,203 bbl/d. This is in line with previous indications.
• The cash position at the end of September had been previously reported and there are no surprises in the rest of the balance sheet.
• With the end of the dry season, production has rapidly increased from 10.7 mbbl/d during the first week of October to >21 mbbl/d currently.

• SOC reported third quarter results were the Company’s operations used cash of approximately $31.6 million and are now stuck in disagreement with the California Coastal Commission since September.   
• SOC’s latest update with the Coastal Commission implies this could be a protracted process as SOC is now disclosing it would close the open excavations until there is an agreement
• We believe SOC is not likely to achieve meaningful success in getting the work done in a timely manner. 

Progress to an exploitation licence and commercialisation of The Metals Company’s (TMC’s) deep-sea assets is unchanged. The development of a strategy to leverage the group’s knowledge and capabilities in the deep sea to provide services to third parties offers the potential of a new and earlier revenue stream.

Alphamin announced record quarterly tin production of 4,917t (+22.1% quarter-on-quarter) in Q324 and EBITDA of US$91.6m (+68.8%) after the Mpama South mine completed its first full quarter of production at (or near) steady state. Alphamin’s consolidated annual financial statements and accompanying management discussion and analysis (MD&A) for FY24 will probably be released in early March. In the meantime, we are forecasting that EPS will continue to advance into FY25 and beyond under the influence of continued strength in the tin price and increasing efficiencies as both Mpama North and Mpama South develop (in particular) along strike.

• Prakash Industries (PKI IN) Bhaskarpara Coal Mine is now received all the government approvals ensuring stable, self-supplied coal for steel production as well as open market sale.
• This development reduces raw material costs, boosts EBITDA potential, and strengthens PIL’s valuation amid past corporate governance concerns.
• PIL has manageable debt and with rising EBITDA, the company is available at a very attractive valuation compared to its peers.

• Shell’s Q2 revenue fell by 7.4% YoY and its adjusted earnings dropped by 3.1%. However, its revenue and EPS surpassed analyst expectations by 2.3% and 13.1%, respectively.
• Shell’s free cash flow rose 44.4% YoY to USD 10.8 billion, while its net debt fell to its lowest since 2015, dropping by 13.1% YoY to USD 35.2 billion.
• Shell’s LNG sales grew 6.4% YoY, while oil and gas production earnings rose 9% YoY, supported by a 3.1% production increase from new fields.

• Balchem Corporation’s third-quarter results for 2024 highlight its resilience and adaptability amid a mixed economic environment, showcasing strengths that bolster its growth potential while also signaling areas for investor caution.
• The company posted impressive financial results, with revenues reaching $240 million, a 4.3% increase compared to the previous year.
• This growth was mainly driven by robust performances in the Human Nutrition & Health and Specialty Products segments.

On 5 November, Pan African Resources (PAF) announced that it is to acquire privately owned Tennant Consolidated Mining Group (TCMG) in Australia’s Northern Territory for a total consideration of US$54.2m in an all-share deal that involves it issuing an additional 125.4m shares (or 6.5% of its existing share capital). The acquisition price equates to an undemanding US$42.15 per resource ounce of gold or US$139.21 per reserve ounce. While we expect the acquisition to have little effect on PAF’s earnings in FY25 (apart from the increase in share capital), we estimate that it will increase FY26 earnings by US$24.6m (or 19.1%) and FY27 earnings by US$42.6m (or 29.6%) and, on this basis, will undoubtedly be accretive.

• Sailfish Royalty reported Q3 financial results that missed our estimates due to decreased production from Mako Mining.
• Mako management has outlined that production will return to normal levels in Q4.
• Over the last nine months, FISH has repurchased 1.6M shares, decreasing its share count by 1%.

• SDRL reaffirmed contract activity remained sluggish even though the Company is 70 percent contracted through the end of 2025. Day rates have not compressed. 
• SDRL has managed through 2024 with less of its fleet operating than desired due to special surveys and mobilization of two rigs to Brazil.
• For 2025, SDRL should have two rigs (West Auriga and West Polaris) operating in Brazil giving the Company the ability to grow adjusted EBITDA. 

• Premium brands focus on high-value large rims, leaving small-rim markets.
• Factory closures signal overcapacity as brands exit small-rim tire production.
• New players gain ground in small-rim segments in Europe and North America.

• The 3Q24 production and cash position at the end of September had been reported previously.
• Production in September and October stood at ~26.4 mbbl/d. This is very high.
• The company expects production to be ~26 mbbl/d over 4Q24. We only assumed 24-25 mbbl/d. 

• Cumulative Q3 FY12/24 sales reached JPY807.7bn, a 3.3% YoY increase, with operating profit up 158.5% YoY.
• Packaging and Graphics segment saw improved product mix and price adjustments, boosting operating profit by 78.1% YoY.
• Functional Products segment sales rose 7.4% excluding divestiture impact, with operating profit increasing 41.8% YoY.

• DNG reported another record quarter, posting 20% YoY sales growth and 50% YoY EBITDA growth due to the increased gold price and record levels of ore processed.
• Dynacor again improved its balance sheet, with $42M in cash (up from $35M last quarter) with negligible debt, while also repurchasing shares.
• We remain bullish on DNG going into 2025 and beyond as its kicks off its plans for expansion in both Peru and West Africa.