Platinum Asset (Investment) Management Ltd

PTM Details
Launching exchange traded versions of actively managed funds: Platinum Asset Management Ltd’s (ASX: PTM) stock price got slashed by 6.4% on April 28, 2017 on announcement of new Exchange Traded Managed Funds (“ETMFs”) and changes to product fees. The group now intends to launch two Exchange Traded Managed Funds (ETMFs) in August 2017 and these will help investors to access Platinum’s International and Asian equity strategies via the ASX. The launch would be subject to regulatory approval. The funds will have the same portfolio composition, portfolio managers and investment strategy as the underlying funds and the fee structure will include a management fee of 1.10% per annum (pa) and a relative outperformance fee of 15%. With regards to the product fees, Platinum is adding a new performance fee option to each of its eight Platinum Trust Funds and will be lowering the total fees and expenses charged under the standard fee option for each of the Platinum Trust Funds and Platinum Global Fund. The group has lowered the standard management costs on the Platinum Trust Funds and Platinum Global Fund from 1.5% to 1.35% pa. These moves have been suggested in order to benefit clients with regards to channel choice and price options. It is interesting to note that the fee and cost reductions will not have impact on 2017 revenues or profit but are expected to lower PTM’s 2018 revenue. 2018 pro-forma, annualised, revenues is now expected to decline by up to $24 million (9%) as a result of these changes. The investment manager is also facing some headwinds with regards to the funds under management (FUM) in a competitive environment. However, we believe that PTM can recoup the growth at the back of long-term efforts; and given the price fall,we maintain a “Buy” recommendation at the current price of $ 4.66


PTM Daily Chart (Source: Thomson Reuters) 

Orocobre Ltd

ORE Details
Rise in Olaroz facility’s sales: Orocobre Ltd (ASX: ORE) witnessed a stock price rally of 7.1% on April 28, 2017 while the group held its teleconference to discuss the results of the March 2017 Quarterly Report. The group reported that Olaroz facility’s sales in tonnes rose 5% in the March 2017 quarter against the December 2016 quarter sales with revenue rise of 19%. Overall gross operating margins have now jumped up to 65%. On the other hand, lithium production at ORE’s Olaroz facility declined by 21% (to 2,784 tonnes) from the prior corresponding period at the back of above average rainfall during the summer months, but was as per the expectation and in line with guidance. The group has also now identified and rectified errors relating to its pond system’s inventory model and the changes are expected to deliver major improvements to the operating performance.ORE now expects half year production (2H FY17) to be in the range of 5,500 – 6,000 tonnes, and a further rise is expected in 1H FY18.
 

Performance at Olaroz Lithium Facility (Source: Company Reports)
 
Although, ORE expressed concerns over challenging market conditions in the core South American markets of Argentina and Brazil, the long-term relationships with customers is helping the group. At Borax Argentina, there was a 10% rise in sales volume at the back of improved efficiencies and performance against the December quarter figure. The group’s cash on hand is of the order of US$30.6 million at the end of the quarter and this is the same as the cash on hand as at 31 December 2016, with guarantee releases of about US$3.1 million. The stock has fallen about 32.7% this year to date (as at April 27, 2017), and looks to be a “Speculative Buy” at the current price of $ 3.15


ORE Daily Chart (Source: Thomson Reuters)

Disclaimer
 
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd currently hold positions in:  BHP, BKY, KCN, PDN, and RIO. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.