London, UK, 19 January 2023

Edison issues update on Baker Steel Resources (BSRT)

Baker Steel Resources Trust (BSRT) posted an NAV total return of -16.3% in FY22, which was mostly a result of the de-rating of recently floated holdings Tungsten West and First Tin and the impact of Western sanctions against Russia on Polar Acquisition (PAL) and Azarga Metals. However, BSRT also agreed to sell its equity stake in its largest holdings (Bilboes Gold, completed in January 2023) and saw progress across several projects. BSRT's maturing portfolio offers the prospect of attractive income from royalty payments (on production launch of Futura, PAL and Bilboes Gold) and dividends (from Caledonia Mining Corporation, CMCL, and later potentially also Cemos).

BSRT's shares now trade at a wide discount to NAV of 41% (vs a five-year average of c 20%). Moreover, we see potential for an NAV uplift following the successful completion of the currently ongoing fund-raising processes to either initiate mine construction or enable production ramp-up (Futura, Tungsten West, Kanga Investments, Nussir). Also, a meaningful part of BSRT's portfolio (c 27%, according to our estimates) is in listed equities, some of which (First Tin, CMCL) are reflected in BSRT's NAV at a discount due to lock-ups, which will expire later this year.

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