Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
FINANCIAL HIGHLIGHTS
Revenues increased by 5% to $2,266 million (2018: $2,162 million) as higher production and sales offset lower copper prices
Full year copper sales volumes of 317 kt (2018: 296 kt) and gold sales of 225 koz (2018: 169 koz)
Average LME copper price in 2019 reduced by 8% to $6,000/t (2018: $6,526/t)
EBITDA 1 of $1,355 million at an EBITDA margin of 60% (2018: $1,310 million)
Operating profit increased by 8% to $923 million (2018: $851 million)
Industry leading net cash cost 1 of 77 USc/lb (2018: 85 USc/lb)
Gross cash costs1 reduced to 140 USc/lb (2018: 144 USc/lb) driven by increased contribution from Aktogay and cost efficiencies at the East Region
Gold by-product revenues rose by 50% to $318 million (2018: $212 million) driven by 10% increase in production, 10% higher average LBMA gold price and the sale of inventory
Structural factors of economies of scale, competitive energy and transport costs, and low strip ratios continue to support the Group's low cost position
Net debt 1 $2,759 million (2018: $1,986 million)
2019 investments include $436 million cash consideration for the Baimskaya acquisition and $718 million of expansionary capital expenditure (2018: $530 million)
Gross liquid funds1 of $541 million at 31 December 2019 (2018: $1,467 million)
- $1.0 billion of committed facilities undrawn as at 28 January 2020, following amendment of PXF
Final dividend of 8 US cents per ordinary share recommended
Total 2019 dividend of 12 US cents per ordinary share, including the interim dividend of 4 US cents per ordinary share paid on 25 October 2019
OPERATIONAL HIGHLIGHTS
Copper production 2 of 311 kt and gold production 3 of 201 koz (+6% and +10% compared with 2018)
2020 copper production2 guided at 280-300 kt as grades are expected to decline at Aktogay while East Region output is limited by low grades and challenging geological conditions
POSITIONED FOR GROWTH
Strong performance from producing assets supports investment in near and long term growth
Aktogay expansion on track for completion in 2021, $1.2 billion project budget unchanged
Baimskaya feasibility study ongoing, expected to be completed later in the first half of 2020
these numbers are even better than my revised numbers.... I think kaz is so much undervalued...
I think the biggest shift that I can see in 2020 is going to be EV and it's going to be much faster than anyone thought possible before. that will drive the copper demand more than what the experts are estimating and i now revise my long term target of exiting Kaz to £20 from 14-15........
Revised Numbers
my estimate. actual kaz
Revenue $2.2 Billion. $ 2.26b
EBITDA $1300m $1350m
Operating profits $840m. $923m
Net profit $430m $571
EPS 0.91$ $1.21
Free Cash Flow $485m before CAPEX ( but includes sustaining CAPEX in existing mines) $411
I was so close with my $1 billion operating profit guidance!!
Good bit of work you done @hash!,not far out.
We will get a share price boost with a brokers upgrade..
Well done all, the future does look bright for Kaz, all we need is uptick in copper prices and Kaz could easily be trading between 7.00 and 8.00 pounds per share in the near term.
Hash what do you make of the production guidance for 2020
copper production2 guided at 280-300 kt as grades are expected to decline at Aktogay while East Region output is limited by low grades and challenging geological conditions.
Kaz has been consistent in delivering the numbers so I am assuming a flat 2020 but this is what we already knew. so no surprise for me. given the current prices, you can expect similar profitability and cash flows...( i think for copper to keep dropping is not possible so coper prices will drive the Kaz number ) but then as AKTOGAY II comes on board next year we expect copper volumes to go up by as much as 80 KT per year from 2022 which translates into 480m extra revenue and 380-300 m EBITDA and possibly an extra cash flow of about 250-300 m usd
I wonder when the dividend is payable
@hafeez1 "Subject to the approval of shareholders at the Annual General Meeting on 30 April 2020, the final dividend in US
dollars and UK pounds sterling will be paid on Friday 22 May 2020 to shareholders on the register at the close of
business in the UK on the record date, Friday 24 April 2020. The ex-dividend date is Thursday 23 April 2020."
Thanks LeedsWedge
Hash
I have looked at the presentation and the debt repayments do seem alot over the next few years especially from 2022 onwards where it goes to 550 to 600m and then a staggering 900m in 2025 albeit thus can be deferred till 2025
Any idea what the price of copper needs to be to sustain this
Thanks
Sorry should be 2024 and then deferred till 2025 (typing on a tablet)
Rastuss
The debt I refer to is already there before we take on anymore to build Baimskaya
Appreciate that a small part of the current debt is being used for work in progress and feasibility study etc but some is tte Pxf which was deferred from this year in a recent Rns
Knowing this company they will give the mine away to him and possibly a few million as like they did last time
I suppose I will keep with it as it might make me rich one day although it could take a few yrs
Tuscon mentioned a web cast, anyone know what was said. best news we get next
partnership, or solid news about Baimskaya.
Evening Causal, I didn't see the web cast, but I was reading some of the things that was mentioned.
there was a statement by Mr Southam, and I think it is a clear hint of things to come, he said :
“We look forward to releasing further details of our plans for Baimskaya when the bankable feasibility study is completed.”
IMHO, I think this is a hint of an announcement about a Business Partner for the Baimskaya project .
I very much hope so, Kaz SP will fly high !
The full report is here :
https://www.sharecast.com/news/news-and-announcements/kaz-minerals-reports-on-solid-year-of-production--7328672.html
Thanks -Roydon1
Autonomy1
at today's price 5800 for copper and 1600 for gold, they are pretty much of with debt over 8 years. there is a deficit but that can be managed... any new loans could be an issue though...
if the price were to go down by further 10% for copper then we could see a deficit of about $1.4 billion between free cash flows and repayments...and that my guess could be refinanced as the debt would come down and profitability still maintained..
i guess the real challenge would be if copper went down 25%....then payment gap would be $3.4 billion and Kaz will be at about breakeven....so may then struggle to raise more debt to repay the debt.....
if i thought copper could go to 4500$/ tonne (current prices..not adjusted for inflation) and remain there for 7-8 years i would exit kaz ........till then there is some value....
rev cashflow payments deficit
2020 2.1 350 350 0
2021 2.332 400 550 -150
2022 2.564 440 600 -160
2023 2.564 440 600 -160
2024 2.564 440 950 -510
2025 2.564 440 410 30
2026 2.564 440 150 290
2027 2.564 440 150 290
2028 2.564 440 150 290
i meant they are ok with servicing the debt over 8 years at current prices...
they will have a large deficit in 2024 but that can be managed as there is a provision to postpone the debt
when copper hits $4500 / tonne the business will still be profitable in spite of servicing the huge debt they have. the key thing to remember is that if copper were to go down because of economic uncertainty then gold is likely to go up....so if gold were to go up by another 50% if copper went down by 25% then the break-even for Kaz will move to $4000 probably...
share price getting good tanking, even when there some decent brokers grade today
and gold companies are rallying.
Hash
Thanks very much for that,it really helps
Late surge in copper prices. Really disappointed with the drop in Kaz late yesterday and today.
I wonder y it dropped so much today, I know UBS reduced price target down to 610
Hafeez : the only thing I can think of is the that the daily chart for Kaz has formed a "rising Wedge" shape, which if you look it up, always break out downward.
Remember, 98% of all shares are now traded with computers, which are programmed to recognise these shapes, and buy and sell accordingly .
I might be wrong, but I was scratching my head today, and this is what I think .
Now, If this is the reason, then unfortunately there will be further drop, maybe down to 450, unless Copper put a spectacular recovery performance next week.
There might be another reason as well, as they say "Buy the Rumors and Sell the Facts", now the results are out !
GL, and all the best
Funny how time goes, we waited for the full term results,and the share price deserves more credit
For the good results.obviously now down to the virus.getting more in Korea. Can see it again next week being very volatile, if drops to 450,should bounce ,being good value.