Olive Resource Capital Reports 151% Return for 2025, Eyes M&A Wave in 2026

All Resource Capital - Q4 Performance & Market Outlook (January 12th)

Key Concepts:

• NAV (Net Asset Value): The value of a fund’s assets less its liabilities.
• PGM (Platinum Group Metals): A group of six metallic elements – platinum, palladium, rhodium, ruthenium, iridium, and osmium – that share similar chemical properties.
• M&A (Mergers & Acquisitions): The consolidation of companies or assets through various types of financial transactions.
• Free Cash Flow: A measure of a company’s financial performance, calculated as cash flow from operations minus capital expenditures.
• Commodity Complex: A broad grouping of raw materials and primary agricultural products traded on exchanges.
• PGM Equivalence: A method of standardizing the value of different PGMs by summing their individual ounce counts, rather than weighting by price.
• Phase Projects (K92 Mining): Refers to the staged expansions of K92 Mining’s processing plant, designed to increase production capacity.

I. Q4 2025 Performance & Investment Strategy

All Resource Capital reported exceptional performance in Q4 2025, with assets up over 11% in December alone, significantly outpacing gold, energy, and copper benchmarks. For the full year, assets increased by 151% after all expenses and fees – a doubling of the asset base. This performance was achieved with a portfolio weighted 50% towards precious metals, demonstrating strong stock-picking ability. The company’s stock experienced a 240% increase in value during the year, closing the gap to Net Asset Value (NAV). Currently, the stock is trading at approximately 60-70% of NAV, presenting an opportunity for investors.

The success is attributed to strategic portfolio repositioning undertaken in 2023-2024, and a timely deployment of capital starting around November 15th, capitalizing on favorable commodity price movements in November and December. The goal for 2026 is to maintain or exceed this level of performance.

II. Macroeconomic Trends & Sector Outlook

The discussion focused on the anticipated impact of Q4 production reports and 2026 guidance from larger producers. Q4 commodity prices were substantially higher than Q3, creating a favorable environment for increased profitability and margin expansion for mining companies. This is expected to attract generalist investors to the sector.

A key expectation is a wave of Mergers & Acquisitions (M&A) activity, driven by the substantial cash reserves accumulating within large producers. The increased profitability in Q4 is expected to add significant capital to balance sheets, leading to capital returns or growth initiatives. The current environment is seen as a tailwind for the industry, with a potential for increased M&A activity.

III. Gold & PGM Market Dynamics

Gold producers are generating significant cash flow, particularly due to the increase in average gold prices from approximately $3,700/ounce in Q3 to over $4,200/ounce in Q4. This translates to record free cash flow, attracting generalist investor attention.

Currently, gold producers trade at 7-12 times last 12 months earnings, below the S&P 500’s 13-14 times multiple. This discrepancy presents an opportunity for generalist investors to rotate into gold equities. The anticipated next trade is a shift from gold itself to gold equities. This influx of capital into the sector is expected to drive up the prices of larger gold producers, potentially leading to capital rotation into developers and smaller companies.

The discussion also highlighted the strong outlook for Platinum Group Metals (PGMs). The market is currently in a deficit, and increased production from assets like Ivanho’s Plat Reef project is expected to fill this gap rather than depress prices.

IV. Company-Specific Updates & Investment Cases

• K92 Mining: K92 Mining is delivering on its guidance, with exceptional grades (8 grams/ton) and recoveries. The company is simultaneously advancing multiple projects (Phase 2, 3, and 4 expansions), demonstrating strong execution and funded growth. Production is nearing the scale of established producer DPM, and K92 is becoming a “boring” success story – consistently meeting expectations.
• DPM (Dundee Precious Metals): DPM is highlighted as a model of consistent performance, having hit guidance for 11 consecutive years.
• Ivanho Electric: Ivanho Electric is positioned to become a major player in both copper and PGMs. The Plat Reef project is fully funded for Phase 2, aiming for 450,000 ounces of PGM equivalent production within 18-24 months, with a long-term goal of exceeding 1 million ounces by 2031. The company’s diversified asset base (Kamoa-Kakula copper mine, Kipushi zinc mine, Plat Reef PGM project) and Robert Friedland’s leadership are seen as key strengths. The PGM equivalence calculation sums the ounces of each metal, rather than weighting by price.
• Arizona Sonorin: Arizona Sonorin is negotiating to terminate a joint venture agreement with Newton (a Rio Tinto subsidiary) regarding the Cactus project. This is viewed as a critical step to remove an encumbrance that could hinder a potential acquisition of the company. The company has been actively unencumbering the project to increase its attractiveness to potential buyers.

V. Notable Quotes

• Derek First (Executive Chairman): “You’re only as good as your last pick, Sam.” – Emphasizing the need for continued diligence and strong investment decisions.
• Sam Plesz (President, CEO, & CIO): “They’re [K92 Mining] disclosure is starting to border on boring. It’s not because they’re doing anything wrong. It’s because they just hit right.” – Highlighting the consistent and predictable performance of K92 Mining.
• Sam Plesz (President, CEO, & CIO): “Ivanho has the greatest upside on the market this year.” – Expressing strong confidence in Ivanho Electric’s potential.

VI. Conclusion

The All Resource Capital team expressed strong optimism regarding the outlook for the commodity sector, particularly gold and PGMs. The combination of favorable macroeconomic conditions, strong company performance, and the potential for increased M&A activity creates a compelling investment environment. The company is focused on identifying and investing in companies with funded growth opportunities, strong execution, and the potential for significant value creation. The emphasis is on companies that are consistently delivering on their promises and generating substantial cash flow.