Readers of Gresham Advisory Partners’ compilation* of end of financial year market data from the largest 150 metals and mining companies, released last week, would not have been surprised to see that share price winners were very much in the minority this year.
Indeed, only 21 of the 150 companies ended up in positive territory, with just six of those breaking through the 100% share price gain threshold this year.
At the other end of the scale, more than 50 companies saw their share price halve or more, with five suffering falls exceeding 80%.
That hurts. Nevertheless, the winners make for interesting reading.
So here they are.
Strictly Boardroom has picked the eyes out of the data-tables – and lists the winners in the various categories.
Firstly to the Gold medal event – share price appreciation. Here the winner is perhaps all too obvious, being one Sirius Resources, of course.
To the Top 10 share price gains (excluding dividends):
Sirius Resources – 3547%
Peel Mining – 323%
Aeon Metals – 209%
Matsa Resources – 187%
Sumatra Copper & Gold – 146%
Precious Metal Resources – 114%
Capral – 50%
Endocoal – 39%
Poseidon Nickel – 30%
Alumina – 25%
Next to the rankings by market capitalisation growth by percentage terms. Not surprisingly there is overlap with the share price winners – but also some other companies that have attracted market support by way of new equity.
The growth in capitalisation honour roll is as follows:
Sirius Resources – 5334%
Peel Mining – 397%
Sumatra Copper & Gold – 355%
Aeon Metals – 252%
Matsa Resources – 195%
Precious Metal Resources – 114%
Hot Chili – 78%
Wolf Minerals – 61%
Capral – 53%
Gujarat NRE Coking Coal – 52%
Next to the commodity-by-commodity splits. Specific commodity sector winners were as follows:
Copper: Peel Mining
Diversified: BHP Billiton
Gold: Matsa Resources
Industrial minerals: CI Resources (phosphate)
Iron ore: BC Iron
Nickel: Sirius Resources
Uranium: Toro Energy
Finally to the big movers in the relative size rankings. Of the largest 150 as at end June, selected big movers within the top 100 were as follows:
Sirius Resources, up 485 places to a rank by size of 24th-largest by end June 13 from a year earlier
BC Iron, up 30 places to 28th
Western Desert Resources, up 47 places to 36th
Gujarat NRE Coking Coal, up 54 places to 38th
Papillon Resources, up 24 places to 39th
Base Resources, up 36 places to 42nd
Orocobre, up 26 places to 51st
Metals X, up 22 places to 53rd
Blackgold International, up 27 places to 55th
Hot Chili, up 67 places to 56th
Elemental Metals, up 31 places to 60th.
Let’s hope that the 2013-14 financial year sees more resources companies return material share price appreciation.
The sector is certainly starting from a very low base.
Indeed, breaking into the top 150 companies (excluding oil/gas) doesn’t take all that much these days – with the qualification threshold only at $34 million by total capitalisation.
Making the top 100 currently requires only a market cap of around $60 million. That is a historic low. Five years ago, for example, the number to break into the top 100 was at least double that mark.
We may be witnessing a once-in-20-year low in mining valuations.
Finding bargains shouldn’t be all that difficult right now out there.
Allan Trench is a Professor at Curtin Graduate School of Business and Research Professor (Value & Risk) at the Centre for Exploration Targeting, University of Western Australia, a non-executive director of several resource sector companies and the Perth representative for CRU Strategies, a division of independent metals and mining advisory CRU Group (email@example.com).
*ASX Resources – Gresham Group 150, July 2013 edition. Darren Martin firstname.lastname@example.org