If you wiped circa 75% from the asset base, assumed 27 mill in remaining cash after all debts paid - the business would return 15-16c a share to holders. They got -43% less for LL than they were expecting, so if they got -50% for their assets, shareholder would get 24c a share. Minimum downside risk to me, unless you think cash is worth nothing.
Given that they now have the assets to run a profitable copper business for the next 4 years, I am not concerned about their zinc business, which will improve in due course and as some 250,000tpa of zinc from Brunswick etc comes offline in March 2013.
I have a hold because markets at a macro level have been running hot for some months now. To plan for a some kind of pullback in May-June if not now seems prudent.
KZL Price at posting:
15.0¢ Sentiment: Hold Disclosure: Held
