Updates on ABB and PEN please.

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Question asked 22/07/2023

Updates on ABB and PEN please.

Hi MM, 1) ABB: Given recent price action, which has been quite weak over the last month, can we please have an update on ABB's prospects and MM's views on the stock, including what your expectations are for its upcoming Q4 trading update which I presume is due shortly? 2) PEN: Can we please have an update on PEN, which both MM and Shaw have advised/commented on fairly recently, given the 19.07.23 announcement about the termination of its contract with its former resin processing provider, Uranium Energy Corp. Obviously, some delays and uncertainty have been introduced to the picture but, given the subsequent share price falls what are your views on PEN's value and prospects, etc.? Thanks, Darren

Answer

Hi Darren,

We like ABB for a number of reasons. We see their costs coming down as they leverage the growth being achieved and expect a strong quarterly update. Market expectations are low on this heading into reporting and see a likely chance of the company meeting or beating expectations and providing strong guidance.

Peninsular have been dealt a blow as their mine contactor walked from their agreement. It leaves Peninsular in a tough position, having been expected to be the first uranium company back in production, which has now been pushed out ~18 months. Peninsular were always going to bring production in house around that time frame as they ramped up into stage two production of the uranium contained resin at their Lance project. The ramp up will be brought forward, however there is a greater risk around costs and delivery times now, particularly given the company was hoping for revenues coming through from stage 1. We would expect them to now need capital.

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LAST UPDATED 21/07/2023 12:16

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