Listen to the webcast link above again and appreciate from 11.22 onwards
11.22 A REMINDER ON TAX
For every dollar spent on the Sulphide project and heap leach pad expansion we expect a 35 cent cash tax credit to be generated, that can be used to reduce tax payable now and in the future.
In the first qtr we recognise incentive tax credits of $31m for the full year Alacer expects to generate $71m of incentive tax credits from eligible spend on the sulphide project and heap leach pad expansion THAT WILL BE RECOGNISED AS A CREDIT TO THE TAX EXPENSE ACCOUNTS.
The effective tax rate for accounting will continue to be a significant credit in 2018 as the incentive tax credits continue to be generated and recognized in the financials and we carry those forward as a deferred tax asset to offset future tax payable
12.24 Finally and perhaps most importantly we expect Alacers consolidated effective cash tax rate going forward to be around 5%
I'm not sure if investors fully appreciate the financial implications of this.
based on the US$71m, this equates to 24 cps positive impact on earnings for the full year.
AQG Price at posting:
$2.37 Sentiment: Buy Disclosure: Held
