I think it is now time to move on. The funding package is done and the GM on 17/8/17 will approve it. HRR would have confirmed the acceptability of the funding structure with Institutional Shareholders before getting to this point. It would have been suicide for the Board to have done otherwise.
I construct detailed financial forecasts for all companies I invest in including HRR. The NPV quoted here of 8.6cps is considerably lower than mine so I'm interested to know the reason for the difference. Hence I'll share some of my numbers here so you can point out where: Forecast Assumptions:
1. Minelife = 10 yrs
2. Zn production = 640m lbs
3. Cu production = 150m lbs
4. Pb production = 260m lbs
5. Zn price = US$1.4/ lb
6. Cu Price = US$3.0/lb
7. Pb Price = US$1.1/lb
8. C1 = A$1.50 before by product credits
9. Royalty = 4%
10. CTR = 30% after utilization of A$97m tax losses.
11. Development Capital = A$156m
12. Sustaining Capital = A$98m
13. NOS & Options = 2438m The Result:
1. Average PAT Yr 1 to 5 = A$82m. Average EPS = 3.4cps
2. Average PAT LOM = A$55m. Average EPS = 2.3cps
3. NPV (6%) = 17 cps
Hence my NPV is double 8.6cps so please show me the difference?
HRR Price at posting:
8.5¢ Sentiment: Buy Disclosure: Held