Canadian-based research experts, Atrium Research, have valued Trigon Metals’ ownership of the Kombat mine in Namibia at C$243 million (about N$3.2 billion) following the mine’s stellar performance in the first quarter of its 2025 financial year, where the mine reported a breakout quarter with revenue of N$178 million.
Atrium Research provides institutional quality issuer-paid research on North American public equities using deep fundamental analysis.
In its report for the three months ending June 30th, 2024, representing Trigon’s Q1-2025, it justified their valuation, saying that they value Trigon Metal’s 80% ownership of the Kombat Mine at C$5.56/share and the total company at C$5.55/share when including its net debt.
“We then apply a 0.6x Net Asset Value (NAV) multiple onto this to achieve our target price of C$3.50/share. We use a conservative 0.6x NAV multiple and 8% discount rate as the company has yet to achieve a steady state of production; thus, there is ample upside to our target price if Trigon Metals executes,” said the research experts.
Trigon Metals engages in the acquisition, exploration, development, and operation of mines in the African continent. The company holds an 80% interest in its flagship project, the Kombat Mine Property, which consists of five mining licenses that cover 1,219 hectares and one prospecting license covering 1,057 hectares located in Northern Namibia. It also holds 100% interest in the Silver Hill Project, comprising approximately 16 square kilometres located in the AntiAtlas region, Morocco.
TURNING POINT FOR KOMBAT
Financially, Trigon reported its best quarter since commencing production, highlighting the impact that underground production can have on overall operations. The company reported its first positive EBITDA of N$11.4 million, adjusted EBITDA of N$32 million, and operating cash flow before working capital of N$6.6 million.
In the same period, the company reported a breakout quarter with revenue of N$178 million (vs. N$69 million in Q4/24) and a C1 cash cost of US$3.23/lb, which continues to trend downward.
CEO Jed Richardson stated that the company is on track to meet its 2025 financial year guidance and is trending to the lower end of the range for its cash cost guidance.
“We are excited and impressed by this first quarter with full underground production and look forward to future quarters as the company optimises, brings more mining fronts online, and continues to scale up production.”
Operationally, the company exceeded expectations with underground mined tonnes beating guidance, grade within range, and processed tonnes on the upper end of guidance for the quarter. Copper was produced, and C1 cash costs were within guidance, with the company producing 2.3 lbs of Cu at a C1 cash cost of US$3.23/lb. These metrics do not include the open pit mine, which continues to perform well and is proving to be an important backstop to Trigon’s mining operation.
“Operating cash flow is expected to largely improve next quarter as Q1 included an asset impairment write-off for the failed pump and deferred revenue payments, and we expected operational improvements going forward. Underground grade decreased slightly due to the mining of mineralisation outside of the planned stops (grade was still strong but less than planned). Grade increases at depth, so it is anticipated the mined grade will increase as mining operations move to lower levels,” says Atrium Research.
Trigon also has made notable improvements in its first full quarter of underground production, with its key metrics improving significantly.
“Firstly, the open pit exceeded our expectations despite scaling back as the underground ramps up. Underground operations performed well as the company continued to ramp underground production, mining an average copper grade of 2.0%, a silver grade of 11.4 g/t, and mining 57Kt of underground ore vs. 12Kt in the previous quarter,” Atrium Research said further.
Trigon is allocating N$45 million–NN$62 million towards exploration initiatives focused on replenishing mineral reserves and uncovering new prospects within the Kombat Valley. Recently, the company announced key developments in its exploration campaign at Schlangental, a prospect located about 15 km east of the active ML73B mining license.
This follows the completion of Trigon’s comprehensive exploration strategy, which spans an extensive area of nearly 35 km, from Gross Otavi in the west to Schlangental in the east.
“The Schlangental drilling is exciting as it represents the first campaign outside the main Kombat mining license, specifically focussing on the Copper King Extension prospect. Trigon’s geologists were attracted to this area due to visible surface mineralisation and historical drilling reports that indicated deeper mineralisation, despite the absence of detailed drill logs. Out of the 36 planned holes, totalling 4,000m, only two have been drilled so far, with both intercepting strong mineralisation, including 3.5% Cu over 7.0m and 1.99% Cu over 3.0m,” concludes Atrium Research.