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Amerigo Resources Ltd T.ARG

Alternate Symbol(s):  ARREF

Amerigo Resources Ltd. is a Canada-based copper producer. The Company owns a 100% interest in Minera Valle Central S.A. (MVC), a producer of copper concentrates. MVC, located in Chile, has a long-term contract with the El Teniente Division (DET) of Corporacion Nacional del Cobre de Chile (Codelco) to process fresh and historic tailings from El Teniente. The Company operates in one segment, the production of copper concentrates under a tolling agreement with DET.


TSX:ARG - Post by User

Comment by sclardaon Aug 17, 2022 9:48pm
174 Views
Post# 34903796

RE:dividend

RE:dividendAurum1983 wrote

Any chance that they will cancel/suspend the dividend?

-------------------------------------------------------

It all depends on where copper prices go from here. At the current copper price of around $3.60 ARG should have annual  EBITDA of aprox. $35 million US or aprox.  $42 million Cdn. From that we have to subtract income taxes, interest etc.  They should be netting aprox. $32 million Cdn. The 3 cent quarterly dividend costs ARG aprox.  $20 million Cdn. per year. If copper prices stay at these levels they should be able to continue with the current dividend as they are still banking aprox. $1 million Cdn. per month after paying the dividend. They should also have enough money to buy back  $1 million Cdn. per month in shares. They also have aprox. $53 million US in cash and $27 million US in debt so they have a  nice cash cushion and the loan repayments  are  spread out over a few years. 

The price of copper makes all the differance.  At $3 copper they are basically breaking even. At $4 copper they should have EBITDA of aprox. $54 million US. That is a lot of money for a company with
a market cap. of under $200 million cdn.

Personally i sold some shares awhile back around the current shareprice and have been slowly buying back some of those shares as i have faith that copper prices will rebound as they have been doing and i am happy to recieve my 10% plus dividend  every quarter.

Good luck to all.


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