Is Semafo a great company?Yes, no doubt.
Mana is a great mine and that is what matters. Mana is the kind of asset that could fit into a IamGold. The other two mines would not.
The MCAP for Semafo is today around 1100 million CAD$ and for this one gets a producer of 250-300k ounce with a reasonable minelife if one includes M&I resources+ P&P. The growth potential seems limited if 300k is reached. That could of course (and should) be changed if the company aquires another property or producer. As with so many other producers the lack of ability to do this is strange. It isn´t exactly getting cheaper by the day.
Not putting a visible growth strategy towards becoming say a 400-500k ounce producer is the about the only bad thing I can say about the management. What a difference it would have made if they would have been the one aquiring the old Orezone even if they would have paid shares that were much cheaper than today. Still the management seem to be above average.
No hedges and cash costs at a reasonably good level.
I have read two analytical recent research reports on Semafo. BMO and CIBC.
One has SMF as market performer one as market outperform. None of the analysts managed to give a correct number of shares when calculating the MCAP... The correct number is easily to find at the webpage.
What one should know about Semafo Mana is that this is 90% owned by Semafo, 10% by the government and has financed its Mill etc with loans from Semafo.
My estimate based on information from the management is that these loans and adjusted for further expansion at Mana will be repaid during 2010 and 2011. Basically that means that after this the government owns 10% of all value, production and reserves that come out of the Mana project. This might show up as lower production numbers and reserves/resources OR as an increased total cash cost from 2012.
Conclusion, Semafo is slightly cheaper than its peers (especially NewGold) but one would like to see them buying something good soon.
I do not own any Semafo shares, I simply researched them when I looked at the peer group of OGC which I do own but will not discuss at this board.
Feel free to comment about my views of Semafo or inbox me any questions.