Deloitte Western Australia Index 2018

Deloitte at Diggers & Dealers

Deloitte is proud to be a sponsor of Diggers and Dealers 2018. Held every year in Kalgoorlie, regional Western Australia, Diggers and Dealers is a leading annual mining conference which draws delegates from across the mining, exploration and professional services industries and includes presentations by listed mining and exploration companies.

Attending Diggers and Dealers? Please visit us at booth 7, we’d love to chat!

Report Highlights:

• The Deloitte WA Index increased 26.8% this year, a significant out-performance over the broader All Ordinaries index, and achieving an aggregate value of AU$193.5 billion at 30 June 2018. To put this into perspective, the WA Index has not been above AU$190.0 billion since back in May 2011!
• Commodity price appreciation in key energy-linked commodities such as LNG, crude oil, and thermal coal really stood out this year thanks to growing energy demand throughout China and Asia, and the continued focus toward cleaner energy solutions
• Battery metals and rare earths showed strong momentum on the excitement surrounding battery storage demand, the expanding electric vehicle market, renewables, and our hunger for more and more consumer technology
• The amount of technology and data being assumed in our everyday lives is growing at exponential rates and with the urbanisation of the global population expected to gain pace over the coming years, it’s hard to see this longing for tech-led convenience showing signs of dissipating
• Not surprisingly, numerous companies in the WA Index with ties to these commodities and industries have delivered exceptional returns for shareholders this year and these companies are well represented across our Deloitte WA Index high growth awards list for 2018.

Global indices generally responded well to global economic conditions.

• The S&P 500 accomplished the most notable increase, improving by 12% and achieving an all-time high in late January following rising interest rates, employment growth and improved consumer confidence. Such economic conditions were facilitated by higher corporate earnings arising from US corporate tax cuts, whilst The Trump Administration’s trade wars with China exerted downward pressure on returns towards the end of the period
• The Nikkei 225 rose 11%, reaching its highest level since 1996 on the back of strong corporate earnings and the weakness of the yen against the dollar. Improved investor sentiment across global markets accelerated the return of foreign investment to the market, whilst the continuity of Prime Minister Shinzo Abe’s economic policies further aided the Nikkei in setting multiple new milestones across the period
• The All Ordinaries gained 9% in the year, with Australia’s record 27th year of expansion largely driven by rising commodity prices, near-record high exports to China, and strong US growth. Investors were enticed back into the market following increased confidence in the local market as gains were primarily driven by the mining sector
• The FTSE 100 saw an increase of 4% amidst a ravenous global appetite for equities. The strengthened sterling and political uncertainties following Brexit kept returns modest, whilst much of the gains realised earlier in the period were eroded by escalating trade tensions between the US and China.

Top Movers and Shakers

This year at the Diggers & Dealers conference we recognise the top three movers in the WA Index top 20, in terms of market capitalisation growth, for the year ended 30 June 2018 - Emeco Holdings Limited, Lynas Corporation Limited and Pilbara Minerals Limited.

We also recognise the largest three movers of the WA Index top 100, in terms of market capitalisation growth, for the year ended 30 June 2017 - Tungsten Mining NL, Australian Mines Limited and European Lithium Limited.

Congratulations to all six winners on their achievements over the past year.

Feature articles

The Mining Matrix: Rekindling the pride in our industry - what needs to happen to improve the image of mining, but also to maintain the focus on growth and increased productivity?

Lifting our game: Stuart Tonkin, CEO, Northern Star; Kate Sommerville, VP Mining, Gold Fields; Warrick Hazeldine, MD, Cannings Purple and Julie Harrison, Partner, Deloitte.

_{Published: August 2018}