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Northland Capital Partners View on the City - Motif Bio (LON:MTFB); Savannah Resources (LON:SAV); Thor Mining (LON:THR); Petrel Resources (LON:PET); Botswana Diamonds (LON:BOD)

Northland Capital Partners View on the City - Motif Bio (LON:MTFB); Savannah Resources (LON:SAV); Thor Mining (LON:THR); Petrel Resources (LON:PET); Botswana Diamonds (LON:BOD)

MOTIF BIO
(MTFB.L)

SECTOR – HEALTHCARE

RATING – BUY*

MARKET CAP – £97m

CURRENT PRICE – 33p#

ANALYST: LIAM GASCOIGNE-COHEN

 

Year-end Dec

2016A

2017A

2018E

2019E

 

Revenue (£m)

-

-

 

 

EBITDA (£m)

(39.71)

(38.02)

 

 

Adj. pre-tax Profit (£m)

(40.32)

(44.79)

 

 

Adj. EPS (p)

(34.60)

(19.35)

Under

review

DPS (p)

-

-

 

 

Net Cash/(Debt) (£m)

15.53

(4.53)

 

 

P/E (x)

-

-

 

 

Dividend yield (%)

-

-

 

 

EV/EBITDA (x)

-

-

 

 

 

SOURCE: Northland Capital Partners Limited estimates. #Priced at prior trading day close. *Northland Capital Partners Limited acts as Joint Broker to Motif Bio and therefore this information should be viewed as a Marketing Communication.

 

Half-Year 2018 Financial Results and Operational Progress

 

NORTHLAND VIEW

  • Motif Bio announced its unaudited financial results for the half year ended June 30, 2018.
  • Net loss for the period was US$7.8 million (H117 loss: US$29.7m)
  • R&D costs decreased significantly to US$6.9 million (H117: US$23.6m). This was primarily driven by a reduction in expense for the now completed Phase 3 clinical trial program.
  • Cash and cash equivalents at June 30, 2018  was US$19.8 million (December 31, 2017: US$22.7m)

Motif has made significant progress towards commercialisation during this period. The Company submitted a New Drug Application (NDA) to the FDA for iclaprim, the Company’s lead antibiotic candidate for the treatment of acute bacterial skin and skin structure infections (‘ABSSSI’). This NDA has been accepted by the FDA which has set a target decision date of February 13, 2019. We expect a positive approval decision by the FDA to allow the Company to market iclaprim in the US. 

The Company is now focused on optimizing the commercialisation strategy for iclaprim for a successful US launch. In parallel with partnering discussions, Motif is evaluating ways to build an appropriate team ahead of the potential launch. Finally, in August 2018, the Company also received Notice of Allowance from the US Patent Office for two method of use patents regarding the use of iclaprim to treat patients with bacterial infections. These patents will expire in November 2037 and provide additional exclusivity for iclaprim.

 

COMPANY DESCRIPTION

Clinical stage biopharmaceutical company specialising in the development of novel antibiotics.

 

 

SAVANNAH RESOURCES (SAV.L)

SECTOR – MINING

RATING – CORP*

MARKET CAP – £67.6m

CURRENT PRICE – 7.85p#

ANALYST – DR RYAN LONG

                     BARRY GIBB

 

Year-end Dec

2016A

2017A

 

 

 

Revenue (£m)

-

-

No forecasts provided

EBITDA (£m)

(1.8)

(2.8)

Adj. pre-tax Profit (£m)

(1.8)

(2.8)

Adj. EPS (p)

(0.46)

(0.53)

DPS (p)

-

-

Net Cash/(Debt) (£m)

0.7

1.2

P/E (x)

-

-

Dividend yield (%)

-

-

EV/EBITDA (x)

-

-

 

SOURCE: Northland Capital Partners Limited estimates. #Priced at prior trading day close. *Northland Capital Partners Limited acts as Nomad and provides commissioned research coverage to Savannah Resources and therefore this information should be viewed as a Marketing Communication.

 

Option of Aldeia application

 

NORTHLAND VIEW

  • Savannah Resources has decided to proceed with the option for the potential purchase of the 2.94km2 Aldeia Mining Lease application, which is located in close to its Mina do Barroso Lithium Project, in Portugal. Savannah first announced it was looking at the Aldeia application on the 18/07/18.
  • The exercise of the option agreement follows technical and legal due diligence completed by Savannah that highlighted the excellent lithium prospectivity, with rocks chip samples returning results ranging from 0.65% Li2O to 1.53% Li2O and geological mapping and air photography interpretation suggesting a 300m long and 25m wide pegmatite body. This is a similar geometry to the 16.4mt Grandao Deposit, at Mina do Barroso.
  • The Option period is until 25/06/19. After which Savannah will have to commit to the purchase of the Proposed Licence Area, once granted. The option cost is €358,000, of which €58,000 is due upon execution of the Pledge and Purchase Agreement and the balance payment of €300,000 payable in 4 equal instalments.
  • The total purchase price for the acquisition of the Proposed Licence Area (once granted) is €3.25m, of which €55k would be paid upon execution and the balance in 71 monthly instalments. These payments are expected by the Company to be made once the Mina do Barroso project is in production.

 

Figure 1: The location of the Aldeia Mining Lease application

{C}{C}{C}

Source: Company

 

Savannah has completed its due diligence at the Aldeia application (Figure 1) and the results seem to be exciting, with early-stage work indicting the potential for the project to contain a deposit of similar scale to that of the Grandao deposit, which forms the core of the proposed operations at Mina do Barroso. Much work still needs to be done for the potential of the project is fully demonstrated but Savannah has proven its self, as able to rapidly advance these projects through drilling, Mineral Resource Estimation and Economic Studies. Savannah has structured the acquisition through staged payments to reduce its risk exposure should the project encounter any technical or other issues with the balance of the acquisition cost only expected to be paid once the mining operations are up and running.

 

COMPANY DESCRIPTION

Savannah Resources is an energy metals group with copper-gold projects located in Oman, lithium projects in Portugal, and a operates a mineral sands project in Mozambique that is a JV with Rio Tinto

 

 

 

THOR MINING (THR.L)

SECTOR – MINING

RATING – CORP*

MARKET CAP – £10.1m

CURRENT PRICE – 1.65p#

ANALYST – DR RYAN D. LONG

                     BARRY GIBB        

 

Year-end June

2017A

2018A

 

 

 

Revenue (£m)

-

-

No forecasts provided

EBITDA (£m)

(1.3)

(1.3)

Adj. pre-tax Profit (£m)

(1.3)

(1.2)

Adj. EPS (p)

(0.4)

(0.2)

DPS (p)

-

-

Net Cash/(Debt) (£m)

(0.1)

1.0

P/E (x)

n.a.

1. Northland Capital Partners Limited (“Northland”) acts as Nominated Advisor and/or Broker to the company.

2. Northland) and/or its affiliates companies do beneficially own 1% or more of any class of the issuer’s equity securities, as of the end of the month immediately preceding the date of issuance of the research report or the end of the second most recent month if the issue date is less than 10 calendar days after the end of the most recent month. 

3. The authoring analyst or any associate of the authoring analyst does maintain a long or short position in any of the issuer’s securities directly or through derivatives, including options or futures positions.

4. Northland, its affiliated companies, partners, officers, directors or any authoring analyst of Northland has provided services to the issuer for remuneration during the preceding 12 months other than investment advisory or trading services.

5. Northland or any of its affiliated companies has performed investment banking services for the issuer during the 12 months preceding the date of issuance of the report.  

6. A partner, director, officer, employee or agent of Northland or any of its affiliated companies is an officer, director, employee or advisor of the issuer.  Disclosures are applicable for all companies

7. The authoring analyst, or any associate of the authoring analyst, has viewed the material operations of the issuer. 

8. The authoring analyst, or any associate of the authoring analyst, received reimbursement for travel expenses.

9. Northland makes a market in the securities of this company.

 

 

DISCLAIMER

This document is provided solely to enable clients to make their own investment decisions. It may therefore not be suitable for all recipients and does not constitute a personal recommendation to invest. It does not constitute an offer or solicitation to buy or sell securities or instruments of any kind. If you have any doubts about the suitability of this service, you should seek advice from your investment adviser. This document is produced in accordance with UK laws and regulations. It is not intended for any person whose nationality or residential circumstances may render its receipt unlawful.

The past is not necessarily a guide to future performance. The value of shares and the income arising from them can fall as well as rise and investors may get back less than they originally invested. The information contained in this document has been obtained from sources which Northland Capital Partners Limited believes to be re¬li¬able. The Com¬pany does not warrant that such information is accurate or complete. All estimates and prospective figures quoted in this report are forecasts and not guaranteed. Opinions included in this report reflect the Company’s judgement at the date of publication and are subject to change without notice. If the investment(s) mentioned in this report are denominated in a currency different from the currency of the country in which the recipient is a resident, the recipient should be aware that fluctuations in exchange rates may have an adverse effect on the value of the investment(s). The listing requirements for securities listed on AIM or PLUS markets are less demanding, also trading in them may be less liquid than main markets.

Northland Capital Partners Limited and/or its officers, as¬sociated entities or clients may have a position, or other material interest, in any securities men¬tioned in this report. Northland Capital Partners Limited does not provide recommendations on securities of firms with which it has a corporate relationship. More information about our management of Conflicts of Interest, Investment Research Methodology & Definition of Recommendations can be found at www.northlandcp.co.uk 

Northland Capital Partners Limited is authorised and regulated by the Financial Conduct Authority and a Member of the London Stock Exchange.

Published by/copyright: Northland Capital Partners Limited, 2013. All rights reserved

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