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Annual Financial Results Released by Zinc Mining Company

Streetwise Reports, Streetwise Reports
0 Comments| March 22, 2018

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Trevali Mining Corp. (TV:TSX; TV:BVL; TREVF:OTCQX) recently released its audited annual financial results for 2017. The company had net income of $20.2 million, or $0.03 per share, and EBITDA of $101 million on total revenues of $330.5 million. Fourth quarter net income was $25.2 million, or $0.03 per share, and EBITDA was $56.3 million on net concentrate sales revenues of $188.8 million.

Paradigm Capital analyst Jeff Woolley said of the results, "With both zinc and lead fundamentals currently strong, we forecast Trevali to generate substantial free cash in 2018 of $185M or $0.22/sh (+300% y/y). With only $160M in total debt, the company is well positioned to evaluate additional growth opportunities. Enhanced exploration programs at all the mines will seek to add tonnes to the resource base to extend mine life or potentially support mill expansions down. However, we believe Trevali is better positioned than ever to pursue additional acquisitions."

"Trevali's growth story is coming together at a most advantageous time in the market as supply constraints drives zinc higher. Trevali's two legacy mines are operating well and generating positive free cash flow, while the recently acquired African mines from Glencore have more than doubled the production base and we estimate will more than triple the consolidated free cash generation making Trevali a "go-to" name for investors seeking zinc/lead exposure," Woolley noted.

In a March 15 research report, analyst Brian MacArthur of Raymond James wrote, "2017 & 4Q17 production results were pre-released and in-line with our estimates. 4Q17 production came in at ~105 mln lbs of payable zinc, 13.5 mln lbs of payable lead and ~397 Koz of silver and 4Q17 EPS came in at $0.03, below RJL and consensus estimates of $0.05. Trevali repaid ~$40 mln in debt during the quarter and had ~$158 mln in total debt (including finance leases) at quarter end, in addition to ~$144 mln in working capital and ~$97 mln in cash."

"Given Trevali's high leverage to the zinc price and solid balance sheet, we continue to believe that the company offers investors one of the best st options on zinc, one of our preferred commodities, and rate the shares Outperform," stated MacArthur.

In its release, Trevali noted a number of financial highlights for 2017:
  • Concentrate sales revenue of $330.5 million, up approximately 220% versus 2016
  • EBITDA of $101 million, up 141% from $42 million in 2016; and annual net income of $20.2 million or $0.03 per share
  • Income from mine operations of $86.1 million, up 203% from $28.4 million in 2016
  • Total cash position of $97.3 million and working capital of $144 million.




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