Good ResultsThink hard on this for future - forget about Didipio
4th Quarter
99.155 gold ounces produced ( lets assume that means sold, averaged over time)
AISC of 1,075 consolidated ( that means all expenses excluding interest and income taxes and lcapital costs of new ounce exploration, not replacement ounces). Basically the cost of running the existing company like it is,in perpuity, without adding in interest and income taxes.
Assume the company made the current price of gold $1,835 per ounce
That means a spread of 760 x 99,155 or 75 million +
Multiply that by 4 you get 300 million
Subtract 200 million times 3% for interest and banking fees and say 10 million for income taxes ( There would probably be no income taxes if Didipio writedowns and with all the exploration costs) Note direct taxes are included in AISC)
So you get 300 million less 16 million or 284 million cash generated.
Enterprise value in US$ ( net debt plus share value) rougly $1,400 million
That means a 4.93 payback of enterprise value, assuming no new developent costs , and company can duplicate 4th quarter results and gold stays at current level.
I understand that company is in high grade now but is also working with Covid.
There is no reason that the company cannot mine almost 400,000 ounces per year at that AISC in the future years, it should do better. It should have ample cash to fund its
developements with the renewed bank facilities and internally generated funds ( an understandable concern in 2020)
I feel better about this investment than I have since I invested in it.
I invested in it as I thought its valuation gave me a free option on Didipio, and I feel that way again, with a little to spare.