- A disciplined bottom-up security selection process
- We seek well-managed low-cost producers with rising returns on invested capital, sound financial positions, and an ability to finance future growth plans
- Valuations are considered under a broad range of commodity price scenarios to identify undervalued companies
- We position the portfolio to capture undiscounted upside optionality such as higher than expected grades and production growth
- Information inefficiencies in the market are especially evident in less-followed mid- and small-cap companies where our industry expertise, management knowledge and research capabilities are critical
High quality
- Invest in companies with strong management, strategy, geology of deposit, and infrastructure and low political risk
- Focus on companies with ability to finance future growth plans
Growth at a reasonable price
- Value creators grow per share reserves, production, and free cash flow
- Outperformers typically exceed expectations while enjoying a rising return on invested capital
Upside optionality
- Undiscounted production/reserves growth
- Takeout valuation and attractiveness
Leverage craft knowledge to identify market inefficiencies
- Small-cap discounts decline as companies grow
- Discounts decline as project, mine risk declines
Asset Quality
Strong technical knowledge provides the ability to evaluate & assess assets at an early stage.
Management
Experience and strong relationships provide an advantage in identifying high quality, trustworthy management.
Financial Health & Valuation
Companies are evaluated on a number of metrics in order to benchmark management assumptions and understand the stability, direction & allocation of free cash flow. The team will also use scenario analysis (low, base and high case) to identify upside potential and downside risk relative to what the market is pricing in.
ESG Analysis
The team integrates material ESG factors into investment analysis and investment decisions, accounting for material impact to risk and return.
“Barbell Approach” of blending recognized industry leaders combined with small- to mid-cap emerging growth companies designed to provide exceptional alpha-generating opportunities
Time-tested investment team
- Highly experienced team with average industry experience of 26 years
- Specialist in geology, engineering and investment expertise
Bottom-up stock picking
- Focus on generating sustainable alpha from bottom-up stock picking
- Scenario-based reward-to-risk analysis
- No major macro calls on commodity prices
Small- and mid-cap expertise
- Early identification of attractive small- and mid-cap investment opportunities
- Need for craft expertise makes this an inefficient segment of the market
Size advantage
- Among largest specialty global resource managers
- Ready access to companies, industry experts, liquidity