Tribeca Global Natural Resources Ltd. · ASX:TGF
Tribeca Global Natural Resources — Investor Presentation (August 2020)
43 slides from Tribeca Global Natural Resources's investor presentation, Aug 5, 2020
Slide 1: ASX Investor Update Presentation cover letter
5 August 2020 For personal use only ASX Market Announcements ASX Limited 20 Bridge Street Sydney NSW 2000 BY ELECTRONIC LODGEMENT Investor Update Presentation Please find attached Investor Update Presentation. The information contained in this document has been prepared for use in conjunction with a
Slide 2: Investment Update
Tribeca Global Natural Resources Ltd (ASX:TGF) Investment Update Ben Cleary, Portfolio Manager Todd Warren, Head of Research August 2020 For personal.use only
Slide 3: For personal use only
This presentation has been prepared for Tribeca Global Natural Resources Limited (ABN 16 627 596 418) ("TGF") by its investment manager, Tribeca Global Resources Pty Ltd (ABN 11 606 707 662) ("Tribeca") under AFS License 239070 (Tribeca Investment Partners Pty Ltd). The information contained in this
Slide 4: Overview
Overview I 1. 2020 YTD Performance Review ] 2. Macro Update ] 3. China Update ] 4. Investor Positioning ] 5. Core Sector & Stock Positioning Tribeca Global Natural Resources
Slide 5: For personal use only
For personal use only • • • • • • •
Slide 6: TGF NTA (Post Tax) vs Share Price Since Listing
For personal use only TGF NTA (Post Tax)* vs Share Price Since Listing $3.00 10% 0% $2.50 -10% $2.00 -20% -30% $1.50 -40% Series1 Share Price (LHS) Series2 NTA Post Tax (LHS) Series3 (RHS) Prem/Disc -50% $1.00 -60% $0.50 -70%
Slide 7: Net Exposures by Sector
For personal use only Net Exposures by Sector Net and Gross Exposures 140% Uranium 120% Soft Commodities Gross Exposure Net Exposure Services 100% Precious Metals 80% Oil & Gas 60% Diversifed Mining Private Credit 40% Bulk Commodities 20% Battery Metals Base Metals 0% -5% 0% 5% 10% 15% 20% 25% 30% 3
Slide 8: Top YTD Listed Equity Portfolio Contributors & Detractors
Top 10 YTD Listed Equity Portfolio Contributors & Detractors Main contributors have been precious metal longs and energy shorts while main detractors have been longs in energy. 0 Contributors Top 10D om Base Metals IX_GFLP_ Copper Oil & Gas US_SNDE Sundance Energy Precious Metals AU_SAR Saracen Serv
Slide 9: Top Long Equity Holdings
Top 20 Long Equity Holdings (alphabetical order) Security Base Metals AU_AWG Alumina Ltd Diversified AU_BHP BHP Billiton Ltd Uranium AU_BOE Boss Resources Ltd Precious Metals AU_CHN Chalice Gold Mines Ltd Base Metals CA_CGP Cormerstone Capital Resource Uranium US_UUUU Energy Fuels Inc Base Metals US
Slide 10: Key Portfolio Changes
Key Portfolio Changes a Despite record contango, record barrels stored on water and record day-rates, g El eal Sold Oil Tankers tankers couldn’t make fresh highs and we sold as the forward-looking delta was only one way (lower). The facts changed in March: the oil war between the Saudis and Russia,
Slide 11: Team Update
am Update Todd Warren joined the Tribeca GNR team in May Todd joined as an equity partner and as Head of Research having spent more than 20 years with the Colonial First State Global Resources team based in Sydney and London. Todd brings a wealth of experience to both investment process and portfoli
Slide 12: Macro Update
Ndifarel-Resources Macro Update es
Slide 13: Total Purchases by central banks
For personal use only Total Purchases ($t) -1 0 2 3 4 5 6 1 Fed ECB BoJ EM Other DM
Slide 14: US recessions, CRB index and M2
For personal use only US RECESSIONS AS DEFINED BY THE NBER CRB SPDT INDEX (Y/Y%, LS) US M2/INDUSTRIAL PRODUCTION (Y/Y%, ADVANCED, RS) 60 40 40 30 20 20 0 10 -20 0 -40 -10 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Sources: Refinitiv Datastream, Canaccord Genuity estim
Slide 15: Comparing QE Periods
Comparing QE Periods Commodity prices rallied for more than 2 years after the first QE from 1Q2009 to 1Q2011 Commodity Peaked Time Performance Since QE Silver Late April, 2011 +369% Nickel Late February, 2011 +181% Copper Mid February, 2011 +181% Gold Late August, 2011 +131% Coal Mid January, 2011 +
Slide 16: Comparing QE Periods
Comparing QE Periods * Commodity prices have begun to rally from the March 2020 lows when current QE was announced. * Relative to 2009-2011 there would be material upside from here Commodity Performance Since QE Silver +71% Nickel +21% Copper +37% Gold +20% Coal -21% Aluminum +8% Steel -17% Source:
Slide 17: USD vs Industrial Metals Performance
For personal use only USD vs Industrial Metals Performance US Real Yields vs USD 122.5 -1160 1320 0.80 120 -1170 -1180 1300 0.60 117.5 115 -1190 0.40 -1200 1280 112.5 -1210 0.20 110 -1220 1260 107.5 -1230 0.00 105 1240 -1240 102.5 -0.20 -1250 100 1220 -1260 -0.40 97.5 -1270 1200 95 -1280 -0.60 92.5
Slide 18: Bloomberg Commodity Index Monthly
For personal use only Bloomberg Commodity Index Monthly 250 200 Price 150 100 50
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For personal use only
Slide 20: Normalisation of Key Leading Chinese Indicators
Macro Update — Normalisation of Key Leading Chinese Indicators Daily property sales have now risen back to close to flat y/y levels Power-plant coal consumption pointed to normal levels Daily property sales (30 LAM sized cities - Commercial buildings) Daily power plant coal consumptions (Six major g
Slide 21: For personal use only
For personal use only Sources: Deutsche Bank, WIND Sources: Deutsche Bank, WIND Sources: Deutsche Bank, WIND
Slide 22: China Credit Growth Underwrites The Next ~6 Months
China Credit Growth Underwrites The Next ~6 Months 70 50 65 40 60 55 50 50 20 45 40 10 35 30 0 09/05 06/08 03/11 12/13 09/16 06/19 —ISM Manufacturing PMI BBG China Credit Impulse yoy Source: Bloomberg a Tribeca Global Natural Resources
Slide 23: Commodities Like Copper Have High Correlation to PMI
Commodities Like Copper Have High Correlation to PMI 70 180 160 68 140 120 60 100 55 80 60 50 40 20 45 0 -20 40 -40 35 60 -80 30 -100 10/95 07/98 04/01 01/04 10/06 07/09 04/12 12/14 09/17, 06/20 —ISM Manufacturing PMI — Copper c/lb yoy Source: Bloomberg Tribeca Investment Partners
Slide 24: Oil - The Big Laggard Within Commodities
Oil - The Big Laggard Within Commod 70 180 160 65 140 120 60 100 80 55 80 40 50 20 ie) -20 45 -40 -60 40 -80 -100 35 -120 -140 30 -160 10/95 07/98 04/01 01/04 10/06 07/09 04/12 12/14 09/17 06/20 —ISM Manufacturing PMI — Brent Crude Oil (YoY) Source: Bloomberg ca | Tribeca
Slide 25: For personal use only
For personal use only
Slide 26: Investor Positioning: Precious and Base Metals
Investor Positioning: Precious and Base Metals | For personal use only Gold bo Siver 2.0 x 10 ina! A se coh ee eo atl Ww co WAL WN eacw i | re cAe) OY \ 00 WG { \h My “5.0 1 30 4.0 -4.0 15 16 17 18 19 20 5 16 17 18 19 20 — Net long positions in Gold (Z-score) — Net long positions in Silver (Z-score)
Slide 27: Investor Positioning: Energy Complex
Investor Positioning: Energy Complex wt Brent 30 30 25 20 20 15 1.0 10 00 0s 00 “1.0 05 Mo -2.0 AS “3.0 18 16 17 18 19 20 18 16 7 18 19 20 — Net long positions in Crude Oil Z-score) — et long positions in Brent (Z-score) NatGas Gasoline 30 3.0 20 2.0 to 10 00 0.0 1.0 po -2.0 -2.0 -3.0 -3.0 -4.0 18 1
Slide 28: Investor Positioning: Non-Ferrous Metals
Investor Positioning: Non-Ferrous Metals lron Ore Steel Rebar 15 16 7 18 19 20 “46 16 7 18 19 20 —Net long positions in Iron ore (Z-score) — Net long positions in Steel Rebar (Z-score) Source: Bloomberg P= | For personal use only Tribeca Investment Partners
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For personal use only
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For personal use only • • • • • • • •
Slide 31: Private Credit and Listed Equities split
For personal use only Private Credit 17% 83% Listed Equities • • •
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For personal use only
Slide 33: Main Portfolio Themes
3 Main Portfolio Themes * Gold and Precious Metals (~30%) - 5x more stimulus and money supply in 2020 vs 2008 - Real rates negative and curve control will maintain this - Multiples are half prior cycle highs plus leverage 29 * Copper and Nickel (~24%) C - Chinese demand for base metals now positive
Slide 34: G3 Central Bank Balance Sheets vs Gold
G3 Central Bank Balance Sheets 8x vs Gold 6x over past 20 years For personal use only 1,000 900 .AEJCBBS G Index 814.2122 GOLDS Comdty 628.8828 800 700 600 Last price 500 400 300 200 100 0 Sources: SAV Markets, Bloomberg
Slide 35: Challenging the Paper Tigers – Bullion at a Record
For personal use only Challenging the Paper Tigers – Bullion’s At A Record Against A Basket Of World’s Top Currencies 1.2 1.0 0.8 0.6 0.4 Gold equally weighted against USD,EUR,JPY,CNY 0.2 0.0 Sources: SAV Markets, Bloomberg
Slide 36: Current gold bull market
For personal use only 800 700 600 500 400 300 200 100 Current bull market 0 1 41 81 121 161 201 241 281 321 361 401 Number of Weeks Sources: Nowandfutures, TheDailyGold.com , Barrons, Incrementum AG
Slide 37: Enterprise Value per Ounce of Resource vs Gold Price
For personal use only Enterprise Value per Ounce of Resource Divided by Historical P/NAV – Universe of Coverage Average Gold Price – North American Gold Developers 0.12 2.30 Bull Market 2.10 (mid-2019) 0.10 EV per Oz of Resource/Gold Price 1.90 0.08 1.70 P/NAV (x) 1.50 0.06 1.30 Bull Market (2001-20
Slide 38: Gold & Precious Metals
Gold & Precious Metals Portfolio construction consists of mix of large caps (~10%), mid cap quality (~7%), mid cap growth (~7%) and developers (~5%) Seeing a heightened amount of deal flow in the space which is consistent with previous cycles and likely intensify if gold moves towards US$2000/0z and
Slide 39: Base Metals
Base Metals Large cap quality names such as Freeport have doubled off the lows and are now unchanged for the year, while other stocks such as Teck are still big laggards ~15% of the portfolio in these large cap companies with diversified earnings where we see ~50% upside ~10% of the portfolio in mid
Slide 40: Can Copper and Gold Go Up Together?
Can Copper and Gold Go Up Together? There is generally a positive historical correlation between returns of copper & gold going back to 1990. Periods where both rallied together: 2003, 2006, 2010, 2016. 12000 2000) YoY Return (Copper x-axis, Gold y-axis) ‘0 1800 1600 — copper e000 —gold 4400 4200 10
Slide 41: Fundamentally, We See This Continuing
Fundamentally, We See This Continuing Bull Drivers in Common Independent Bull Drivers + Weakening US dollar - stronger stimulus in the US vs ROW is likely to continue to drive the US dollar weaker, supporting all commodities. Macroeconomic recovery — more bullish copper, but also should bring strong
Slide 42: Uranium — Market Deficits Increasing
Uranium — Market Deficits Increasing + Uranium represents ~15% of the portfolio Portfolio allocation has been skewed to spot price linked companies given the price remains well below new project marginal costs + Uranium was one of the largest beneficiaries from Covid-19 related production declines w
Slide 43: Contact Information
Contact Information For personal use only Investor Relations Email: TGFinvestors@tribecaip.com.au Web: https://tribecaip.com/lic Singapore Tribeca Investment Partners Pte Ltd #16-01 Singapore Land Tower 50 Raffles Place, Singapore 048623 Tel: +65 6320 7711 Sydney Tribeca Investment Partners Pty Ltd
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