Central Asia Metals' (CAML) half-year numbers were characteristically strong for a company at the foot of the global cost curve for copper production. In fact, there was just one major disappointment in a period in which copper sales jumped 24 per cent to 6,355 tonnes, fully absorbed unit cash costs fell 48 per cent to just 97¢ (73p) per pound and the cash profit margin widened to 56 per cent, and that was at an average copper price of $4,903 a tonne.
Of course, that was out of the company's hands, as was the beneficial devaluation of the Kazakh tenge. An area where Central Asia retains control - the interim dividend - once again saw shareholders awarded a payout equivalent to more than a quarter of revenues.
The balance sheet is only set to strengthen. Once the expansion programme at the Kounrad copper dump concludes later this year, capital expenditure will drop sharply and expand the cash reserves. That could also lead to the development of the group's Copper Bay site in Chile, although chief executive Nick Clarke will only sanction projects that are accretive on a cash profits basis.
Analysts at Peel Hunt are forecasting adjusted pre-tax profits of $27.7m and EPS of 15.7¢ for the December year-end, rising to $32.7m and 19.3¢ in 2017.
CENTRAL ASIA METALS (CAML) | ||||
|---|---|---|---|---|
| ORD PRICE: | 173p | MARKET VALUE: | £193m | |
| TOUCH: | 173-180p | 12-MONTH HIGH: | 185p | LOW: 121p |
| DIVIDEND YIELD: | 5.9% | PE RATIO: | 9 | |
| NET ASSET VALUE: | 100¢* | NET CASH: | $30.2m | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2015 | 30.3 | 10.1 | 4.98 | 4.5 |
| 2016 | 30.9 | 15.0 | 9.57 | 5.5 |
| % change | +2 | +48 | +92 | +22 |
Ex-div: 6 Oct Payment: 28 Oct £1 = $1.33 *Includes intangible assets of $40.2m, or 36¢ a share. | ||||
