Peel Hunt Note Highlights 26th April 202126 Apr 2021 14:45
This has just come out from Peel Hunt. A small increase in the target price, but decent analysis on what the Company is doing at the moment.
CEY’s strong Q1 production report was a good sign that management is looking to run Sukari on a more consistent basis throughout the year. Visibility on the mine plan and strong operatin practices were evident. We increase our target 3% to 150p on account of the stronger than forecast cash balance. Buy
A solid Q1 but leaving 2021 production unchanged Centamin reported stronger than expected Q1 production of 104k oz, vs consensus at 93k oz and PHe on the low end with 77k oz. Revenue, costs, capex and FCF also beat for the quarter. Despite the broad strength in numbers to start
the year, CEY maintained guidance. We have similarly left our production and P&L forecasts unchanged, leaving potential to beat year-end guidance in H2.
Cash balance stronger than expected, reinforcing USc9 dividend forecast
Total liquidity was reported at a strong US$331m vs our US$284m forecast. The
Q1 cash beat was due partly to lower capex, which we have added back to the rest of 2021. We now forecast a 2021 net cash balance some 15% higher than previously, which should give investors confidence about Centamin’s ability to pay at least our USc9 dividend forecast for the year
arget price bumped to 150p, maintain Buy rating
On the back of the stronger cash balance at Q1 and also for the full year 2021, we have bumped our target price by 3% to 150p (from 145p). With 28% potential upside to our revised target price we maintain our Buy. We expect Q2 production of 95k oz (guidance of 95-100k oz), before increasing again in Q3 to +100k oz
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