Baker Steel Resources expects two of its portfolio companies to float in the coming months, but expressed disappointment that the sale of its largest holding Bilboes Gold did not go through.
The mining-focused trust increased its NAV by 2.7% to 98.8p over the six months to end June 2021, which it said reflected the mixed backdrop for the sector with precious metals weak and base metals strong.
The portfolio’s total value was £106.2mln, though there were no new core investments pending the expected sale for cash of its investment in Bilboes. Net gains for the half-year were £2.7mln (£3.49mln).
In the short term, Devon-based Tungsten West is expected to IPO in the second half of 2021 and First Tin Ltd (formerly Anglo Saxony Mining Ltd) in the first half of 2022.
Together the two miners accounted for more than 20% of the portfolio at end of June.
Further out, Baker Steel’s investment manager believes an uptick in inflation is probable, which will be good for precious metals especially if negative real interest rates persist.
The trust’s exposure to copper, silver and tin assets should also benefit from the switch towards greener infrastructure and electric vehicles.