Daily Brief Energy/Materials: Fortescue Metals, James Hardie Industries Plc, Base Oil, Air Water Inc, Capitan Silver , ADF Group , Obsidian Energy and more

• FMG’s FY25 earnings slumped, with net profit hitting a five-year low as weak Chinese demand and global oversupply pressured prices.
• Heavy reliance on iron ore and limited diversification keep Fortescue lagging peers Rio Tinto and BHP, amplifying downside risks ahead.
• Fragile share price recovery faces technical headwinds, while narrowing steel mill margins undermine near-term prospects for premium ore demand.

• Stockland posted a strong FY25 result and guidance, highlighting growth potential in residential and commercial property, while addressing funding concerns.
• -Stockland posts FY25 and FY26 guidance beats -Master-planned communities growth a highlight in residential -Data centre partnerships to drive commercial -Analysts praise a reduced dividend payout

• Global base oils prices hold firm versus feedstock/competing fuel prices.
• Margins hold firm at time of year when fundamentals are typically weaker.
• Firm margins incentivize refiners to maintain high base oils output.

• Company: Founded in 2000 through the merger of Hoxan, Daido Sanso, and Kyodo Oxygen, Air Water is a diversified conglomerate spanning industrial gases, healthcare, food logistics, and energy.
• Future Plans: Driving growth through semiconductor gases, UPS systems for AI/data centers, and hydrogen infrastructure, while scaling healthcare and logistics.
• Valuation: Trades at ~7x EV/EBITDA and 11x forward P/E, a deep discount to global peers (Linde, Air Liquide at 14–17x EV/EBITDA).

• Asia’s base oils demand could stay more cautious amid expectations of healthy availability of supply, concern about exposure to lower prices.
• Cautious buying would coincide with likely seasonal pick-up in lube consumption in coming weeks.
• Dynamic leaves blenders facing challenge of holding sufficient supplies to meet finished lube demand while maximising benefit of any further fall in base oils prices.

• India’s imported Group II heavy-grade base oils cargo price-premium to FOB prices in US and Asia holds firm and in relatively narrow range in recent weeks.
• Price-spread stays in narrow range as CFR India cargo price tracks lower FOB Asia/US Gulf coast prices.
• CFR India cargo price falls amid pick-up in availability of supplies, boosting buyers’ choice.

• What you need to know: • Capitan Silver announced its first set of drill results from its ongoing 10,000m phase 1 drill program.
• • Drilling intersected a new high-grade intercept (2,636 g/t Ag over 1.5m) ~150m east, expanding the Jesus Maria zone.
• • Drilling continues with 6,700m of 10,000m completed to date, and assays are pending for 30 holes.

• What you need to know: • ADF entered into an agreement to acquire Groupe LAR Inc. for $19M.
• LAR operates in the machining, welding, and industrial mechanics sectors, primarily focusing on the large-scale hydroelectricity market.
• • LAR posted $80.9M in revenue in 2024 (ending December 31st) and had a backlog of $104.5M as of July 31st.

Key points (machine generated)

• Stephen Loukas was appointed CEO of Obsidian in 2019, guiding the company to financial stability through strategic asset transactions.
• Loukas, with an asset manager’s perspective, may consider selling the company or its assets to larger operators for maximum value.
• On April 7, 2025, Obsidian sold its Pembina assets for $220 million, with Loukas emphasizing a cautious approach to future asset sales.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Asia’s base oils prices hold firm versus Singapore gasoil prices.
• Firm base oil margins so far in Q3 2025 point to fundamentals that remain sufficiently balanced and that curb need for lower output levels.
• Firm margins coincide with signs of relatively steady base oils output in early-Q3 2025 even after completion of most plant-maintenance work.