Lion Selection Group Ltd. · ASX:LSX
Lion Selection — Shareholder Meeting (November 2024)
28 slides from Lion Selection's shareholder meeting presentation, Nov 28, 2024
Slide 1: Lion Selection Group Annual General Meeting
For personal use only LSX Lion Selection Group Annual General Meeting November 2024 www.lionselection.com.au
Slide 2: Disclaimer
Disclaimer For personal use only This presentation does not constitute investment advice. Neither this presentation nor the information contained in it constitutes an offer, invitation, solicitation or recommendation in relation to the purchase or sale of shares in any jurisdiction. This presentatio
Slide 3: Highest growth sector of the market: micro-cap miners
there’s something about Highest Growth For personal use only micro- Sector of the Market cap miners Value creation opportunity • Discovery / project expansion • De-risking • Cyclical re-rating • M&A ASX:LSX lionselection.com.au 3
Slide 4: Micro-Capitalisation Resources: Lion's investing focus
Micro-Capitalisation Resources Lion is well funded, experiencing high volume deal flow, filters on Lion’s investing focus people and undertakes detailed technical assessment For personal use only Many investors are seriously Lion has a natural advantage to disadvantaged by typical risks: overcome ea
Slide 5: Cycle Timing: Crucial
Cycle Timing: Crucial Central to Lion investment strategy For personal use only • Characteristic market patterns define cycles for resources stocks • Cyclic volatility is particularly pronounced for micro-capitalisation stocks • Lion aligns investment behaviours to the cycle ASX:LSX lionselection.co
Slide 6: Cyclical awareness – buy low / sell high
Cyclical awareness – buy low / sell high ASX100 For personal use only Industrials +19% ASX100 Resources -12% 19 April 2022 Micro Resources* -73% Jan 2022 – Present, rebased to 19 April 2022 * The proxy for price of Micro-capitalisation Resources companies is the Median Performance of a group of 608
Slide 7: Long Term Fundamentals: Commodities versus Equities
Long Term Fundamentals 1. Expected rotation of the long-term Commodities / Equities ratio back to commodities Commodities versus Equities Historically, this has created the most substantial mining booms Gulf War For personal use only Commodities expensive Oil embargo 2008 Chinese Induced Commodity p
Slide 8: Commodities VS Equities
Commodities VS Equities 1. Expected rotation of the long-term Commodities / Equities ratio back to commodities How will history describe the present…? Historically, this has created the most substantial mining booms For personal use only Probably as “under-prepared” 2. Coincidence of strong commodit
Slide 9: Commodities: Degrees of difficulty
Commodities Degrees of difficulty Difficulty Diamonds Hard to find & Diamond mafia For personal use only • Process risk • Off-site capex requirements Technically complex Mineral Sands, Industrial Minerals, for transport infrastructure Nickel / Cobalt laterites, Graphite • Transparency / liquidity of
Slide 10: Commodities: When the sky is the limit, and when it isn't
Commodities When the sky is the limit, and when it isn’t Gold: For personal use only • One of the best performing assets over multi-decades Return on minimum price in 1970 (MULTIPLES) • Priced influenced more by buyer urgency than value in use Copper: • Bellwether of the global economy • Price pract
Slide 11: Lion Investing Process
Lion Investing Process For personal use only Deal Flow People Valuation Risk assessment • Listed and unlisted • Competence Key assessment: • Identify and avoid companies • Integrity • Funding (dilution of existential risks • 1,000+ to assess and per share value) filter • Geological upside ASX:LSX li
Slide 12: Lion investing strategy: how is it going?
Lion investing strategy How is it going…? For personal use only $27.0M invested in $43.3M value at Lion’s Australian 31 Oct 20241 Focussed New Saturn Investment Portfolio1 Brightstar Antipa Critica Great Boulder Sunshine Plutonic Koonenberry Alto Lion’s Australian Focussed New Investment Portfolio i
Slide 13: Investing at cyclical low prices
Investing at cyclical low prices $50.4M cash to invest 2 Pre-discovery Definition Assessment Development Production For personal use only Precious, base and Pre-development Australia focus strategic materials stage Brightstar Resources Low capex, cash flow funds growth, strategically sized gold inve
Slide 14: Valuation October 2024: Sum of the parts
Valuation 2 31 October 2024 Sum of the parts Cash $50.4M 35.7cps For personal use only Legacy Investments $13.3M 39.7cps New Investments * $42.8M Tax -$2.2M Total Value $104.2M 73.8cps Market Capitalisation $82.3M 58.5cps The New Investment pool consists of investments made by Lion, with a focus on
Slide 15: Valuation: Sum of the parts NTA
Valuation 2 Sum of the parts NTA (monthly) For personal use only On market buy back Nusantara Share takeover 3.5c 2c Price 1.5c (daily) 1c Pani sale Pani sale Dividends announced completed Pani arbitration initiated 2021 2022 2023 2024 ✓ Large exits at top of the market (2021/2022) ✓ Material reduct
Slide 16: Breaking down Lion's value per share
Valuation 2 Breaking down Lion’s value per share Sum of the parts For personal use only But wait – there’s more STN BTR Value of Lion at market price Legend: Australian Investments Legacy Investments Cash ASX:LSX lionselection.com.au 16 1 6
Slide 17: Investing in high growth Resources via Lion
Investing in high growth Resources via Lion Investing in a deeply discounted market Research driven process 1. 5. For personal use only Micro-capitalisation Resources fell heavily 2022-2024 In house due diligence, underpinned by deep experience and broad networks Targeting highest growth sector 2. B
Slide 18: Powerful contrarian play in a weakened market
LSX:ASX For personal use only Lion Selection Group | Well funded | Investing at cyclical low Powerful contrarian play in a weakened market Subscribe for Lion Announcements http://www.lionselection.com.au Level 2/175 Flinders Lane Melbourne VIC 3000 T +61 3 9614 8008 E info@lsg.com.au
Slide 19: Appendices: References
Appendices For personal use only References 1. Refer to Lion Selection Group announcement to ASX on 25 November 2024 2. Refer to Lion Selection Group announcement to ASX on 7 November 2024 3. Total Shareholder Return (TSR) for Lion Selection Group as at 31 October 2024 since inception in July 1997 w
Slide 20: The Lion Story
Founded in 1997 by Robin Widdup, Lion Selection Group has built a track record as a successful investor in mining assets and interpreter of the cycles of mining. The Lion Story In a 27-year history, Lion has been an early shareholder and contributed to the success of a long list of successful mining
Slide 21: Deal Flow
Deal Flow • LISTED: Metals and Mining classified micro-caps Huge largest group on ASX. >600 (of >1900 listed Extremely broad access to investment companies)* opportunities universe • UNLISTED: Large community of startup, For personal use only explorers and deal makers • Extensive relationship networ
Slide 22: Investment Process
• High deal flow (1,000’s per year) Investment Process Highly • Highly selective conversion to investment (targeting 10-20 portfolio stocks) 27 years of deployment selective • 100% in-house due diligence, specialist mining investment team For personal use only • Growth target: Multiples • Long term
Slide 23: Investment Objective
Investment Objective Valuation Risk Avoid high Multiples Multiples on probability, price available terminal For personal use only outcomes People Highly Capable & Sincere Micro Capitalisation Leverage to most attractive High capability, growth- commodities oriented teams Resources Essential to be ab
Slide 24: Opportunity
LSX • Small and micro-cap resources companies have been Opportunity depressed by small cap sentiment and commodity price weakness (well-funded to acquire multiple, high % Lion has a strong cash position from top-of-market For personal use only • holdings) investment exits and is investing at deeply
Slide 25: Board & Management
Board & Management Strong Foundation MANAGEMENT TEAM For personal use only BOARD Peter Maloney Chris Melloy Robin Widdup Hedley Widdup Craig Smyth Non-Executive Director Non-Executive Director Executive Chairman Managing Director Chief Financial Officer Peter has commercial Chris is a mining Robin’s
Slide 26: Exceptional Access to People
Exceptional Access to People For personal use only Plutonic Limited Brightstar Resources Alto Metals Great Boulder Saturn Metals Critica Limited Antipa Minerals Sunshine Metals Koonenberry Gold Vacancy… ? ASX:LSX lionselection.com.au 26
Slide 27: Gold: Supply VS Demand
Gold: Supply VS Demand Bull markets start when annual production flattens For personal use only Gold (log scale) and Gold Production (tonnes per year) 18x 7x ? ASX:LSX lionselection.com.au 27 2 Source: IRESS DATA, USGS 7
Slide 28: Mining Investor Landscape
Mining Investor Landscape Funds ETF Retail Lion Selection Group ASX100 Resources Index For personal use only 19 companies Capitalisations >$2.4B Index Inclusion Large Capitalisation ASX Small Resources Index & Liquidity 53 companies Capitalisations $150M-$4B • Management external to • Listed company
Lion Selection Group — Shareholder Meeting (November 2024) on 6ix