AIS - Aeris Resources

[System]

Straits Metals Limited (SRQ) was formed through the de-merger of the metal assets from diversified resource company Straits Resources Limited (renamed International Coal Holdings Ltd), and was listed on the Australian Stock Exchange on 2 February 2011.

Straits is a mining and exploration company focussed on copper and gold in Australia and Asia.

Straits controls and operates the Tritton Copper Mine in NSW and the Mt Muro Gold mine in Indonesia and has an exploration portfolio focussing on projects in NSW (through Goldminco) and South Australia. Straits also owns Magontec, a European based specialty metals business.

http://www.straits.com.au

 

[Shaker]

Re: SRQ - Straits Resources

Hi

SRQ had a jump in price today. Lets see if this is a reversal of fortune for the company



Volume of over 60 million shares today

Shaker

 

[System]

On January 4th, 2016, Straits Resources Limited (SRQ) changed its name and ASX code to Aeris Resources Limited (AIS).

 

[greggles]

The Torrens Joint Venture has received the final approval required to commence drilling on the giant Torrens copper anomaly in South Australia. The approval allows for up to 70 deep diamond drill holes and covers the area of the Torrens gravity anomaly. The Torrens copper anomaly has a footprint larger than that of BHP's nearby Olympic Dam mine.

An airborne gravity survey is planned to commence in late February 2018 and drilling is expected to commence in the third quarter of 2018.

The Torrens Joint Venture is between Argonaut Resources NL (30%) and Aeris Resources Limited (70%).

Aeris Resources and Argonaut Resources are up 13.04% and 22.73% respectively this morning.

 

[greggles]

Breakout for Aeris Resources. Big move north yesterday and today on increasing volume.

 

[barney]

Given their Market cap to Cash ratio they did look undervalued …. I'm not watching close enough so missed it entirely ….. Probably still some value though … chart is positive.

 

[peter2]

After that big price spike, price drifted back down to 0.15.

The reason for this post is to remind myself that sometimes one big bullish bar MAY change a trend. My preferred option after a strong down trend is to wait for a bullish 123 Low pattern or the 1st HL. After such a bullish key reversal (arrowed on the weekly chart) I'd place the chart in my reversal watch list and await my setup.

Ha, that's the theory and I didn't on this occasion. I even rescanned the chart to see if the huge KR bar with huge volume was in the results for that week-end (1/12/18). Yep. it was. Missed it by that much. My mistake.

 

[peter2]

It seems that soon after my previous post on AIS, price fell off the cliff and has not recovered.

Back then, AIS was solely a copper producer and we know that the price of copper also fell hard. However recently the POC has rallied strongly buy alas AIS shares have not. It would be interesting to find the reason for that. Did they hedge their Cu production at too low a price? This aspect is for another time.

AIS popped up in a daily bullish scan so I had a look at their recent news.

AIS has bought a working gold mine (Cracow) in Qld from EVN. They've also announced that 50% of the FY21 production has been hedged. This helps their financiers sleep at night. Gold miners are in demand atm so it might be worth keeping an eye on AIS.

 

[finicky]

No, this looks like a rubbish company to me. I picked it on an impulse with time running out to enter the September comp. Lifted it from the signature of a poster elsewhere talking about gold stocks. Didn't recognise the ticker AIS so checked the chart, then found AIS had bought Cracow from EVN a few months ago and were getting some early near mine exploration results.

I don't care what the short term price action is I am repulsed by this kind of company.

They now have close enough to 2 Billion shares on issue considering the inevitable conversion of free director oppies in 2021 at nil exercise price (there's a red flag straight up). Looks like they've had the equivalent of a 20:1 share consolidation in the past too, just going by the all data chart.

In 10 years, the limit of my commsec data, they have not scored profitable earnings per share - company lost $38m in fy20 which includes an impairment of $23m. Yet the M.D (who has a bachelor commerce not engineering or even geology) is paid a base salary of $730,000 and total remuneration of 1.27m in fy2020

Options: very liberal with these, have to counteract the effects of dilution for directors. In 2016 the board granted four of themselves 93m options at nil exercise price. The M.D landed 37m of these. But in the annual report they boast "a lean corporate structure"

Debt - they have it. Hedging - they have it, 50% of Cracow's 2021 production at $2,536/oz, also copper hedging at the Tritton operation. Obligations to vendor (EVN) - $15m in 2021 then another 6 years of 10% royalties capped at $50m.

Not going to bother to go into their early exploration success at Cracow given the above. Chart looks prospective short term. The heavy volume since June all due to the Cracow acquistion from Evolution Gold (EVN)

2 Year weekly

 

[Dona Ferentes]

No, this looks like a rubbish company to me. I picked it on an impulse with time running out to enter the September comp.

2 Year weekly

In RRL thread, mentioned as the other Bell Potter pick for 2021. The AIS 12 month chart is lookin' good (4c to 12c), but there is a whiff of AVOID (and then some).

 

[finicky]

Beware broker recs
Bell Potter analysts' second goldie pick for Cal 2021 (the other, RRL)

Bell Potter's top stock picks for 2021

The “millionaire factory” investment bank Macquarie Group (ASX: MQG), buy-now-pay-later phenomenon Afterpay (ASX: APT), software firm Technology One (ASX: TNE) and fast-food food retailer Domino’s (ASX: DMP) rank among our top picks for 2021. Each year, Bell Potter analysts share their sector...

www.livewiremarkets.com

"Aeris Resources (AIS)
Aeris Resources had a transformational
year in 2020, primarily due to the
acquisition of the Cracow Gold Mine from
Evolution Mining. From a single-asset
copper company highly leveraged to the
copper price, AIS is now a multi-mine
copper-gold producer offering a balanced
exposure to two of our preferred metals.
Following completion of the acquisition on
1 July 2020, Cracow delivered an excellent
maiden quarter for AIS, with production
and costs beating our expectations.
Combined with a good performance from
Tritton, AIS cut its net debt position from
~$60m to $28.3m over the quarter. AIS
has since repaid a further A$7.5m of its
Bridging loan ahead of schedule and made
a voluntary US$2.0m repayment to its
Tranche B facility.
The Cracow acquisition, the strengthening
of the balance sheet, the re-structure
of the share register and some exciting
recent exploration success at Tritton is, in
our view, just beginning to gain recognition
in the market. We forecast strong earnings
and cash flow growth in FY21 on low
multiples and see the opportunity for a
material re-rating for AIS in 2021.
Buy, Target Price $0.112/sh"

 

[peter2]

My selection for the May 2020 monthly comp.

AIS is a copper (NSW) and gold producer (QLD). Price has dipped after their latest qrtly update mentioned reduced production of both gold and copper during their last quarter.

Mgt continues to hedge their future production especially in copper. This will cap price movement even if the POC continues higher. Not a good characteristic for a monthly comp selection.

 

[Dona Ferentes]

There are only 4 copper producers left on the ASX: Only one is below intrinsic value

Right here, right now - the biggest themes driving markets are electrification and decarbonisation – which are really two sides of the same coin. And with the global resolve now clearly past the inflection point, these themes are likely to be the dominant drivers for most of this decade. So...

www.livewiremarkets.com

Aeris recently came to life on the well-timed and equally well-priced purchase of the Cracow gold mine from Evolution in 2020. In fact, so well-timed and priced was the acquisition, that in the space of 12 months management has been able to completely pay off its debt and is now generating strong surplus cashflow. But it is the Tritton Copper mine near Cobar in western NSW that has piqued our interest.

The Tritton mine has been producing copper since 2005. During this time it has produced more than 320,000 tonnes of contained metal. Over the past decade, it has produced between 23,000 and 30,000 tonnes every year. It is forecast to produce around 23,000 tonnes this current financial year, at an all-in sustaining cost (AISC) of $3.75 per pound. Yet despite this long term record, the stock is trading on a consensus average PE of 3-times between the 2021 and 2023 financial years.

Clearly, the market has concerns. From our analysis, there are two major investor issues: mine life and hedging.

 

[peter2]

Meanwhile, an AIS joint venture (30% owned) in HLX has hit high copper zones in it's latest drill results (Canbelego NSW).

Brief moment of glory before the day traders take profits.

 

[qldfrog]

Meanwhile, an AIS joint venture (30% owned) in HLX has hit high copper zones in it's latest drill results (Canbelego NSW).

Brief moment of glory before the day traders take profits.

View attachment 124156

No surprise i failed my entry this morning...

 

[Sean K]

Some pretty good grades and widths close to surface at the Constellation exploration target. Wonder if it'll get wider and deeper...

Had a good run this year.

 

[greggles]

More high grade copper intersections at the Constellation deposit announced today, pushing the AIS share price up to 19.5c.

I like the look of these results. Decent grades and nice wide intersections at shallow depth. Should be pretty economical to get this ore out of the ground.

An additional 45 diamond drill holes are planned for an in-fill resource definition drill program on the upper section of the deposit. Could be a lot of copper, silver and gold under the ground at Constellation.

 

[Sean K]

More high grade copper intersections at the Constellation deposit announced today, pushing the AIS share price up to 19.5c.

I like the look of these results. Decent grades and nice wide intersections at shallow depth. Should be pretty economical to get this ore out of the ground.

An additional 45 diamond drill holes are planned for an in-fill resource definition drill program on the upper section of the deposit. Could be a lot of copper, silver and gold under the ground at Constellation.

These grades and widths close to surface are exceptional. I don't understand why they're not investing in deeper DD holes. Is an oxide deposit just close to surface? I think they had to stop drilling the RC holes due to water and will switch to DD but with those grades....

 

[Sean K]

No real reason for this to be excitable today? Great spt at .18 and poking it's nose up. Last ann was by HLX in the Canbelego JV which wasn't that exciting, was it?... ?

 

[Dona Ferentes]

lots of questions, giving rise to detailed answers (by Lambshanks père)

Over the last year or so large gold equities have trended down about 30%, but Aeris has gone the other way. What’s been the driver behind that?​

“I think it’s partly the history of Aeris over a nine year period. We had to sort out a lot of balance sheet issues around debt, and get the balance sheet to a point where the company is sustainable.

“Last year in July, when we bought Cracow was when the whole transformation started.

“We always had Tritton copper, it was doing really, really well, but there were some challenging copper price times where you know the copper price was at $6,500 a tonne Aussie, which is challenging.

“And when we bought Cracow there was immediate change in cash flow coming into the business and then that combined with a big uptick in copper prices and the market picked up on that. In July this year we announced we’re debt free.

“And then the other thing, which was really a great kicker was the finding of the Constellation deposit at Tritton.

“So when we announced that in November, you can see the share price starting to respond, because it’s a super exciting discovery and it will become a future mining project and every time we announced results they got better and bigger.”

and about a dozen others, fully and diligently answered. Not totally impressed, but on message:

Aeris Resources' Andre Labuschagne on the growth potential of its Australian gold and copper mines - Stockhead

Aeris Resources boss Andre Labuschagne talks to Stockhead about the future of its Cracow gold mine and Tritton copper mine in Australia.

stockhead.com.au