Ann: Yandal Gold Project - Orelia Resource Upgrade, page-15

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bobby.

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18/06/18

04:42

Post #: 33769831
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Originally posted by copperroad ↑

Gold is now trading at A$1744 for those who watch. If EAR comes in around the A$1200 all in costs, then we can do some back of the envelope figures.

I have rounded down the margins to be a little more conservative. (reduced this by $44 per per ounce)This is a rough idea of the potential imo. One also has to allow for debt repayments and we don't really know that number.

80,000 oz x A$500 margins = A$40M pa

100,000 oz x A$500 = A$50m pa

I am sure the company has a lot of losses to use up and the debt can easily be manged.
There is currently 488m shares on issue and lets allow for a placement of another 70m shares for the hell of it. This means EAR will have about 550m shares on issue. This basically means the company can earn something like 7c plus per share and it trades at 26c. As you can appreciate, these are basic guess numbers. You can see why it looks cheap to its peers on these rough numbers with a 10 year mine life. Please dyor on your own numbers or check out Euroz below.
I don't think NST will buy this yet, but maybe they should before any debt or raising and use their own balance sheet for the refurb.
The numbers will pay for the acquisition quick smart, they get the plant for miles of extra capacity and they get all the exploration upside. This is like buying a house and finding out you get the one next door for free.Happy to see some numbers from you guys.

Euroz note does not include the recent 233,000 oz just added.

Part of the Euroz note-
Investment Case
We continue to like EAR as a low capex, emerging producer with excellent exploration upside. The DFS should demonstrate a robust development with reserve of ~ 850koz and annual production of >90koz ( Yrs 1-4 @ 105koz) at AISC of ~ $1,200/oz. We rate the exploration potential highly and expect further high margin ounces will be added over time. The recent Ramone discovery by NST just to the north of EAR’s tenement boundary has opened a new area of interest. Our valuation remains at $0.45/sh which is risk adj by 80%. Corporate action can’t be ruled out NST holding a 19.2% interest and its share price close to record highs.

Expand

question if i may

to copperroad and HC members

if the NST share price started to go south

would that make them more keen to go early

with any bid they might make ?

not advice or suggestion just thinking out loud

cheers bobby

EAR Price at posting: 25.0¢ Sentiment: None Disclosure: Held
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0 Great analysis

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Ann: Yandal Gold Project - Orelia Resource Upgrade, page-15

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