Stanmore Coal (SMR) produced a stellar December Q with ROM coal production of 799kt and total sales of 573kt, up 60% and 80% respectively. This result comes after a successful transition from Isaac Plains (IP) to Isaac Plains East (IPE) mining area. ROM coal production was at a 3.2Mtpa annualised run rate versus the nameplate throughput for the Coal Handling and Wash Plant (CHPP) of 3.5Mtpa. Cash decreased from $19.3m at the end of September to $9.6m. This follows a heavy build in working capital, which has since unwound leaving a current cash balance of ~$31.2m (no debt). Golden Investments issued a third and final takeover offer, which is now unconditional, with an unchanged all-cash price of $0.95/sh. Given the independent expert’s valuation of $1.48-1.90/sh, we do not believe the bid will be successful. BUY recommendation with a revised $1.75 target price.
To access our Stanmore Coal report please log in under the Client Area Log In at the bottom of this page.
Argonaut’s Client Area allows you to view delayed share prices, access Argonaut’s wealth of Research as well as create custom portfolios and set up company watch lists.
If you would like to access our research please contact us to create an account.
