Next Investors logo grey

Hartleys upbeat about Adriatic Metals’ prospects


Published 10-OCT-2019 11:17 A.M.


2 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.

Click Here to View Latest Articles

Finfeed reported a fortnight ago that zinc polymetallic explorer and developer Adriatic Metals (ASX:ADT) had received promising results from metallurgical test work on samples from its Rupice and Veovača deposits.

Analysts at Hartleys noted that the results were either in line with their expectations, or in the case of precious metals, exceeded the assumptions they had modelled.

The deposits are part of Adriatic’s Vareš Project that is close to the mining town of Vareš in Bosnia and Herzegovina.

The project comprises a historic open cut zinc/lead/barite and silver mine at Veovača and Rupice — an advanced proximal deposit which exhibits exceptionally high grades of base and precious metals.

The objective of the test work programs was to establish basic processing data, to test processing options and to develop and test a flowsheet that would demonstrate that a marketable concentrate could be developed from each deposit.

Next Investors Image

Hartleys increases price target

Hartleys resource analyst Paul Howard was impressed with the recoveries achieved, saying, ‘’ Preliminary metallurgical test work results from Adriatic Metals PLC’s (ADT) Vareš Project have demonstrated that 82% of zinc metal and 68% of gold can be recovered to concentrates at the Rupice deposit; as well as lead (90%), copper (83%), silver (93%) and barite (72%).

‘’The results also demonstrate that 91% of the zinc metal at Veovača can be recovered along with lead (82%) and barite (71%).

‘’The lock cycle testing has met our expectations and exceeded what was anticipated for precious metal recoveries in our model assumptions, particularly for silver.

‘’Adriatic has highlighted that the test work is preliminary in nature and expects to optimise these results ahead of a Scoping Study, which is due before years’ end.’’

While zinc is the main game, above expectations precious metal recoveries is certainly good news with gold (green line) and silver (black line) both up about 25% on a year-on-year basis with gold holding around the US$1500 per ounce mark .

Next Investors Image

Having run the ruler across the numbers and taken into account the release of initial mining studies by December, Howard increased his price target to $1.50, representing a 50% premium to the company’s closing price on Wednesday.

Barite could be a bonus

While the company has reported excellent recovery of precious metals and copper at Rupice with further metallurgical optimisation test-work underway, the imminent release of a scoping study could be an even more significant share price catalyst.

The expected payability adjusted recoveries from all concentrates for Rupice are:

Next Investors Image

All Rupice concentrates exceed current specifications at a range of European and Chinese smelters, and in the case of barite, exceeding the API specification.

Howard also noted that barite was of a very high quality, but further work was required to ascertain what contribution it could make as a commercially viable commodity.

General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.