Research Note published by Shard Capital Partners

Emmerson Plc / Ticker: EML / Index: LSE / Sector: Mining

27 March 2019

Emmerson Plc ("Emmerson" or the "Company")

Research Note published by Shard Capital Partners
 Establishes a Five-Year Price Target of c100p.

"EML's recent scoping study at Khemisset demonstrated a robust project with outstanding economics - sector leading capital intensity and bottom quartile AISC to Brazil.  The combination of favourable location, excellent infrastructure and shallow mineralisation pushes Khemisset to the front of the queue in terms of upcoming projects om the potash space.  EML's management has considerable potash experience and the track record to push Khemisset through feasibility and financing at a time of record MOP demand.", writes Phil Swinfen, Analyst at Shard Capital Partners, in a recently released equity research note on the Company ("the Note").

The Note establishes an initial price target of 12pence per share with the potential for the valuation to increase to c100p per share in the next five years:  "Our SotP suggests a current intrinsic fair value of c.12p/sh based on conservative modelling inputs and a punitive 0.25%x NAV multiple reflecting the current stage of development…We see significant potential for value accretion as the company meets development milestones and de-risks, we see of SotP valuation rising from 12p on a risk adjusted basis today to c.100p at production (+5 years) on a pre financing basis."

Mr Swinfen identifies the strategic value of the Khemisset Potash Project which has "High margins and sector-leading capital intensity. We [Shard Capital Partners] calculate Khemisset's capital intensity is…half the industry average due to shallow mineralisation and minimal infrastructure build.  Khemisset's total delivered cost to Brazil is bottom quartile with a considerable freight advantage over peer projects, virtually unrivalled in the sector." Subsequently, Shard Capital Partners can "see rationale for Khemisset to be of significant interest to major players in the potash/fertiliser space.   Potential synergies exist with Moroccan-based OCP Group which is pursuing an aggressive strategy to double mining and triple processing capacity by 2027."

To download the full note please visit the following link: https://www.emmersonplc.com/investors/corporate-documents/

**ENDS**

Notes to Editors

Emmerson's primary focus is on developing the Khemisset Potash Project located in Northern Morocco.  The project has a large JORC Resource Estimate (2012) of 311.4Mt @ 10.2% K₂O and significant exploration potential with an accelerated development pathway targeting a low capex, high margin mine.  Khemisset is perfectly located to capitalise on the expected growth of African fertiliser consumption whilst also being located on the doorstep of European markets. This unique positioning means the project will receive a premium netback price compared to existing potash producers. The need to feed the world's rapidly increasing population is driving demand for potash and Emmerson is well placed to benefit from the opportunities this presents.

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.