Latest Research

Dacian Gold (DCN) - Clearing The last Hurdle To Production

Dacian Gold LogoDacian Gold (DCN) has completed a $110m equity raising comprising a Placement and Institutional Entitlement Offer to raise $92.2m, followed by a 1:3.1 fully underwritten Retail Non-Renounceable Entitlement Offer to raise approximately $17.6m at a price of $2.00 per share. Proceeds from the equity raise will be used to fund the construction of the Mount Morgans Gold Project and for exploration and working capital. The equity raising, coupled with the existing $150m debt facility announced in late 2016, sees DCN fully funded to first production in early CY18. Ore mining will commence in November with first gold production in 1QCY18. We believe DCN has successfully overcome the funding risk hurdle and is now on track to deliver first gold within 12 months whilst maintaining an aggressive exploration program. We maintain our BUY recommendation and target price of $3.00ps ($3.35 prior).

read more...

Doray Minerals (DRM) - Impairments And Impediments

Doray Minerals LogoDoray Minerals (DRM) reported its full year result with a net loss of $35m after a non-cash impairment charge of A$46.8m on the Andy Well and Deflector assets. Revenues of $70.2m were 4% less than the previous period and were 23% less than Argonauts forecasts due to the awaited sale of the copper-gold middlings (worth up to $15m at current spot prices). Our recent site visit to Deflector confirmed the operation is running well and above nameplate throughput capacity. We believe the stock trades at a discount to its peers due to the near term re-financing of its debt facility and the ongoing high cost production issues at Andy Well. We maintain our HOLD recommendation and revise our target price to $0.38ps ($0.59 prior) pending the resolution of short term impediments including the re-negotiation of debt and the sale of the copper-gold middlings.

read more...

Orbital Corporation (OEC) - REMSAFE Needs A Spark

Orbital Corporation LogoReasonable performances from most segments were offset by a surprisingly weak result from Safety & Productivity (REMSAFE) and, although there is little change to our group FY17 forecast, we have pared back growth assumptions for this segment. Our positive view on the long term potential for OEC’s technologies is unlikely to be reflected in share price gains while near term earnings are so weak. Hold maintained.

read more...

Gascoyne Resources (GCY) - Dollars For Dalgaranga

Gascoyne Resources LogoGCY announced it has successfully completed a bookbuild to raise up to $50m at a placement price of $0.50ps and an additional $5m via a Share Purchase Plan (SPP). The funds will be applied towards the development of the Dalgaranga Gold Project as well as exploration and working capital. Argonaut sees this as the successful first de-risking step along the path to production for GCY. We believe a number of key value catalysts will occur in the short term including i) the completion of debt financing ii) a maiden resource and reserve for Gilbeys South, iii) an upgrade to the mine plan to include the updated Gilbey’s South ores and; iv) the award of Engineering, Procurement and Construction (EPC) contracts to commence construction of the project. BUY recommendation maintained and target price of A$0.86ps ($0.75 prior).

read more...

Global Construction (GCS) - Balance Sheet Strength Underpins Growth

Global Construction Services LogoGCS’s first half results were broadly in line with our forecasts, demonstrating continued performance in tough market conditions in WA. During the period, GCS also delivered on its geographical diversification strategy, acquiring a controlling stake in Gallery Facades – a company with operations focused on the East Coast. GCS maintained a disciplined approach to capital management, ending the half year with a net cash position of $14m. The balance sheet strength and Gallery Facades acquisition provide comfort around forecast future growth, and lead to an increased valuation of $0.75 (prior $0.65).

read more...