PINL:VLTAF - Post by User
Post by
4x4on Mar 23, 2012 12:22pm
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Post# 19710206
Scotia Capial....12 month target $3.00
Scotia Capial....12 month target $3.00 .Volta increased resources at Kiaka (Burkina Faso) by 18% to 5.0 Moz..Measured and indicated resources increased nicely by 33% to 4.0 million ounces while inferred resources decreased due to the conversion to M&I resources (Exhibit 1). Resource additions came primarily from depth and the north end of the Kiaka main ore body.
.In conjunction with updating our model to incorporate the new resource estimate, we have made modelling changes to reflect our expectations for the release of the upcoming pre-feasibility study. Notably, we increased our throughput rate to 12.0 mtpa and now expect LOM production and total cash costs of 335 koz at US$689/oz (Exhibit 3).
.Our valuation has remained virtually unchanged with an updated NAV3% of C$3.00 (C$3.05 previously).
.We rate Volta 1-SO. Volta trades cheaply at 0.38x NAV versus peers at 0.70x NAV and offers compelling upside. We note the new resource estimate does not include the newly discovered high-grade zone to the south of the deposit. Along with the release of the pre-feasibility we look forward to seeing more results from this zone in months to come.
Leily Omoumi, MBA (Scotia Capital Inc. - Canada)