Skin in the game: Which directors are buying shares in their companies this week?
This past week has seen several directors of resources explorers and miners increase the stakes in their companies, buying shares via on-market trades or participating in capital raisings.
For eagle-eyed investors, this can often be seen as a positive sign because it implies the director is not-so-quietly-confident in the company’s projects when they put some of their own cash into the kitty.
It’s by no means a guarantee the company will do well or is worth investing in but, if a director has some personal wealth tied to the company’s success, it could lead to greater accountability and decision-making that’s in the best interest of shareholders.
We asked Elevate Uranium (ASX:EL8) managing director Murray Hill – who topped up his holding last week, exercising options granted four years ago, paying $612,000 for 3,600,000 shares at $0.17 per share – why investors should pay attention when an MD makes a direct cash injection into the company.
Hill told Stockhead in his case, it’s a direct show of how confident he is in the company’s 48Mlb eU3O8 Koppies uranium project in Namibia.
“This is a large sum of money and shows my commitment and belief in the company, both in what we are achieving but also what I expect for the future growth of the company,” he said.
“It also demonstrates my belief in uranium as a commodity and thus the nuclear industry to provide carbon free energy globally.
“What do they say, ‘talk the talk and walk the walk’, and I am clearly demonstrating to our shareholders and investors that I am doing so, I believe strongly in our story.”
Hill says having “skin in the game” aligns management with shareholders’ interests.
“The very significant and large investment of my private funds into the company demonstrates my strong belief in the company.”
Just last month, EL8 announced a 136% jump in the resource at Koppies, and currently has three drill rigs working on yet another resource update expected in late Q1 2024.
“It’s growing into a large resource,” Hill said. “The resource is very near surface, 50% is within 6.5 metres of surface while 95% is within 15 metres of surface, which is very shallow and means the mining process is expected to be low cost with a low strip ratio.
“Add to that the application of our proprietary U-pgrade process, which is expected to lower the development and processing costs by about 50% compared to conventional process routes, and we have an exciting project.
Meanwhile, the company is also exploring across its other Namibia tenements, with Koppies just one of four discoveries in the historic uranium mining region.
The move also comes as uranium spot prices have pushed past US$80/lb towards new recent highs.
“We are planning drill programs on the other discoveries next year with the intention of adding to our resource base,” Hill said.
“We are also planning more exploration drilling on a number of our tenements.
“We also have uranium projects in Australia on which we are planning drill programs at both Angela and Minerva in 2024.
“We are expecting 2024 to be an exciting year for the company as a result of our aggressive exploration programs but also the expected continued rise in the uranium price.”
This past week has seen a flurry of directors upping their stake in their respective resources companies.
Iron ore giant Fortescue (ASX:FMG) non-executive director Sebastian Coe topped up his holding in the company with the recent purchase of 5,000 shares to the value of $123,700.
Another iron ore producer, Fenix Resources (ASX:FEX) recently saw chairman John Welborn acquire 2,800,000 shares for $729,172, topping up his holding to 15m fully paid ordinary shares.
REE and lithium explorer Cazaly Resources (ASX:CAZ) chairman Clive Jones bought 1,666,667 shares for $50,000 to total 4,311,667 shares in the company.
Gold miner Brightstar Resources (ASX:BTR) MD Alex Rovira picked up $10,335 at $0.015 and $7,750 at $0.0155 to total $18,085.
Another uranium explorer Alligator Energy (ASX:AGE) saw non-executive chairman Paul Dickson participate in a recent Share Purchase Plan (SPP) picking up 240,384 options exercisable at at 7.8 cent options – to the tune of around $1,874,995.
Gold explorer Saturn Metals (ASX:STN) non-executive director Adrian Goldstone also participated in an SPP, purchasing $40,000 worth of shares at $0.125 per share.
And six Liontown Resources (ASX:LTR) directors participated in an SPP, with chairman Tim Goyder, MD and CEO Tony Ottaviano, non-executive directors Anthony Cipriano, Craig Williams, Jennifer Morris and Shane McLeay all buying $30,000 worth of shares each in the battery minerals player.
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At Stockhead, we tell it like it is. While Elevate Uranium and Brightstar Resources are Stockhead advertisers, they did not sponsor this article.