Skip to main navigation or content
Prosperity Minerals has been growing strongly on the back of the booming Chinese cement and iron ore markets. Its 100 per cent-owned Yingde Dragon Mountain cement production plant performed better than expected - with operating profits of $35.4m - as rising cement prices more than offset 30 per cent input coal price inflation to improve margins overall. The plant also benefited from residual heat electricity generation, which reduced energy costs and kept production lines open despite power shortages across China.
Advertising
Meanwhile, its share of profits from stakes in Prosperity Conch Cement and Shanghai-listed Anhui Chaodong Cement grew 469 per cent to $18.2m. Prosperity has arranged $100m in loan notes to finance expansion of its cement production operations, and is also considering demerging the cement business as a way of unlocking further shareholder value.
High freight rates meant profits from its iron ore trading business rose by just 4 per cent, to $17.3m, but management has plans to improve performance by sourcing raw material from closer geographies. Overall cash generation was strong, though, supporting an attractive dividend yield - the group has offered holders the opportunity to take the 12¢ final payment as shares.
| PROSPERITY MINERALS (PMHL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 114p | MARKET VALUE: | £147m | |
| TOUCH: | 110-118p | 12-MONTH HIGH: | 196p | LOW: 114p |
| DIVIDEND YIELD: | 8.0% | PE RATIO: | 5 | |
| NET ASSET VALUE: | 201¢ | NET DEBT: | 29% | |
| Year to 31 Mar | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2007 | 331 | 45.9 | 37 | 18 |
| 2008 | 508 | 59.3 | 42 | 18 |
| % change | +53 | +29 | +14 | - |
Ex-div: 20 Aug Payment: 5 Sep £1 = $1.97 |
||||
Click here for a guide to the terms used in IC results tables
Booming Chinese demand for construction materials bodes well for Prosperity, so a PE ratio of 5 - a discount to the sector - doesn't reflect growth prospects. Good value.
Last IC view: No previous view.
The only way to access our daily share tips, analysis and profit making tools is with an IC Advantage subscription, and you can purchase yours here.
Profit from our latest investment - Subscribe to IC Advantage today
Promotional Feature
We all want our pets to live long and happy lives. One of the easiest ways to help your four-legged friend get over life's many hurdles is to get them covered with pet insurance.
by Sainsbury's
Promotional Feature
Holidays to Turkey tend to focus on the country's magnificent coastline. Dotted with coves and lined with sandy beaches, Turkey is a sun-worshipper's paradise.
by TUI
© The Financial Times Limited 2008. All rights reserved. "Investors Chronicle", "FT" and "Financial Times" are trademarks of The Financial Times Limited. No part of these web pages may be reproduced or transmitted to or stored in any other website or other form of electronic retrieval system, without prior permission in writing from the editor.
Warning: Do remember, particularly if you are new to stock market investment that the prices of shares and other investments can fall sharply. You may not get back the money you originally invested. The material here is for general information only and is not intended to be relied upon for individual investment decisions. Take independent advice before making such decisions. This site is aimed at UK residents only. To read more please see our Important Warning
-IC-1.5.0d-prod - 07/10/2008 17:37:17 - FurseJ
