The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
Thanks for the input 007, Jotom & John
GOLD: $ 2,280.15
Thanks for the reply 007. Any forecast for earnings in 2024 ?
Thanks John.
I am wondering what the gap will be between EBITDA and Earnings (as a way to value the share and dividend potential) going forward.
EBITDA in 2024 could be over $500m USD if the gold price stays high and costs don't increase too much. Any ideas on how to convert or estimate earnings ? I guess many factors like debt payments (should be lower?), taxes (higher?), capex (only included as debt payments?).
If we estimate earnings at 40% of EBITDA then we will have EPS of around $0.4 (div of $0.20) which would give a current P/E ratio of 9 which seems high for a company which still has plenty of risk.
Sorry I am miles off. I calculated EBITDA for poly.k here but it doesn't seem to relate in any useful way to earnings and EPS in today's financial results.
Current EBITDA of $439m for 2023 is healthier than my estimate for 2024.
Would really like to know how to estimate earnings from that.
Good morning,
Quite a few "ifs", "buts" and "maybes" here but....
IF;
Gold price average of $2100 USD / oz in 2024
AISC of $1300 USD / oz in 2024
GP of $800 USD / oz in 2024
475 koz production in Poly.K in 2024
Earnings of $380 m
475m shares in issue
EPS = $0.8 USD
Interested in what others think.
İn my opinion yes. Post disposal of russian assets I think the picture will be clearer.
Notes from today:
By my calculation earnings per share from Poly.K are $0.60-0.75.
V. Nesis:
Hoping to dispose of Russian assets in Q1. The disposal deal termsheet will probably be released to shareholders in February. They are down to 1 single buyer.
The buyer is under no western sanctions (and is not a stand in for a sanctioned entity).
Potential buyer is in Russia (they were warned off selling to the Chinese).
Relationship with and perception of Polymetal inside Russia has deteriorated. It is seen as still western ("unfriendly) due to the shareholders. Partly this explains the exit of ICT (A. Nesis is a Russian owner not residing in Russia).
The new Omani shareholders are viewed as a neutral party by the Russian authorities.
Nesis thinks an exit is now more easy which does not damage or devalue the Kaz entity.
In particular; Poly K will still rely on POX processing inside Russia for 3-4 years and so this is crucial to continued business. A clean break from Russian debt liabilities needs to created in the disposal. The deposal will not release the value previously thought. The disposal should cover Poly K's Net Debt though.
V. Nesis is still invested / committed.
To get back on the LSE Poly K will need to "bulk up" and this will take 2-3 years
V. Nesis is committed to staying with Poly K
The Omani's want nothing to do with the Russian entity. AIX listing was also based on a commitment to dispose of Russian assets and needs to be followed through on. Even if the asset is not sold at good value it needs to be done.
The dividend payment will be subject to a discussion with the Omani's and only after the disposal of Russia assets.
Expression of thanks to colleagues at Poly.R who are dealing with all the "crap".
Https://www.polymetalinternational.com/en/investors-and-media/news/press-releases/31-01-2024/
Many thanks for the detailed reply John.
Thanks for this analysis John.
Have you attempted to estimate the future dividend based on Kazakhstan only ?
GM to allow remaining MOEX shareholders to exchange for AIX shares.
https://www.polymetalinternational.com/en/investors-and-media/shareholder-centre/general-meetings/#id-617010
This is a newish video on Poly.K. from the company.
https://www.youtube.com/watch?v=cS2KO4RboBE
Yes I think it is just sit and wait at the moment.
If anyone is interested to have a bash at valuing the share (including the potential sale of russian assets div) then It's always interesting to read.
PE Ratio
Earnings 6 7 8
$250m 3.16 3.68 4.21
$300m 3.79 4.42 5.05
$350m 4.42 5.16 5.89
This is a matrix of SP values based on PE ratios.
The debt is going to be very low so maybe earning of $300m-$350m ?
SP of $4.5 - $5.5 ?
Is there an estimate of the EBITDA for Kaz alone?
$400m ?
The confidential Kremlin decree, seen by the Financial Times, would give the Russian state priority rights to buy any western asset for sale at a “significant discount” so they could be sold at a profit.
Putin’s order to his cabinet, signed last week, also requires all private Russian buyers of western assets to be fully Russian-held or in a process to exclude all foreign shareholders, further complicating any exit procedure.
Https://www.ft.com/content/cd627211-68f6-4dfa-8a04-3344deee2e85
According to the board today there will be news next week on the timeline / path ahead.
Current bid price on AIX is $3.60 ?
617.6 RUB on MOEX