Metal Tiger PLC posts full-year pretax profit of £3.8mln thanks to equity

 (), an AIM-quoted natural resources investor, reported a pretax profit for 2020, recovering from the pretax loss made during the turbulent first half of that year, boosted by its equity investments division.

Annual pretax profit fell to £3.8mln, from £4.5mln the previous year. It reported a pretax loss of £3.4mln in the six months to June 2020. 

The net asset value of the group rose to £31.2mln, from £26.9mln, mainly from the company’s equity investments.

Net assets in the Equity Investments division increased to £29.3mln, from £22.1mln, and reported a profit of £4.4mln before finance and administrative costs. This was primarily driven by the increase in value of the company’s recent investments in () and Southern Gold Ltd () together with the dividend of £648,000 from its holding in Sandfire Resources Ltd (), which is also included in the above profit for the segment.

As at the end of 2020, the majority of Metal Tiger’s investment portfolio remained invested in Sandfire, which operates the high margin DeGrussa copper-gold mine in Australia, and continues to progress to commercial production a number of base metals development projects in North America, Africa and Australia.

The company said it is optimistic that Sandfire will perform well as an investment in 2021.

“Part of the strategy for 2020 was to diversify in order to focus on backing several strong management teams, commodity classes, some excellent geology and a diverse range of jurisdictions,” said chief executive Michael McNeilly. “In-spite of a significant increase in activity, we maintained a strong level of risk concentration by opting to hold Sandfire shares as our largest single position.

“We hold a firm level of conviction as to the medium to long term value proposition that Sandfire’s equity presents, and we are strong believers in the untapped exploration and production potential of the Kalahari Copperbelt,” he said. 

“We continue to deliver on identifying high conviction opportunities in line with our investment approach where we believe the concentration of risk in some of our larger investments will ultimately bear fruit and are pleased that overall, they are relatively liquid, have some downside protection, optionality and exposure to potentially significant upside,” he added.

In a separate statement, Metal Tiger announced a C$1mln investment in (TSXV:COR) as part of a C$7.5mln fundraising by Camico.

The proceeds of the fundraise will be used to advance exploration at Camino’s three copper projects in Peru.