Investors shouldn't focus too much on these full-year figures from iron ore developer, Bellzone - developments at its Forecariah joint venture in Guinea are of more interest, where the company is now ready to begin shipping ore. And with broker Canaccord Genuity estimating that the Forecariah project could be worth 56p a share alone, the shares look too cheap.
While mine and infrastructure construction was completed at Forecariah on time, Bellzone could do little but stockpile ore as it waited for Guinea’s mining ministry to award a mining permit. But, despite having taken longer than anticipated, that authorisation was finally granted on 21 May. Importantly, Bellzone has $120m (£75m) of cash left on its balance sheet, as of 16 May - so there shouldn't be a need to raise more capital and Forecariah is fully financed. Moreover, management expects to release a full feasibility study in the coming months for its larger Kalia iron ore project, also in Guinea. Bellzone hopes to start production there in 2014, ramping up to a rate of 50m tonnes per year by 2018.
BELLZONE MINING (BZM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 23p | MARKET VALUE: | £ 171m | |
| TOUCH: | 22.8-23p | 12-MONTH HIGH: | 55.3p | LOW: 17.8p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 31¢ | NET CASH: | $153m | |
| Year to end-Dec | Turnover (A$m) | Pre-tax profit (A$m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2008 | nil | -15.1 | -3.64 | nil |
| 2009 | nil | -16.5 | -3.93 | nil |
| (US$m) | (US$m) | (¢) | (¢) | |
| 2010 | nil | -24.1 | -4.81 | nil |
| 2011 | nil | -46.4 | -6.92 | nil |
| % change | - | - | - | - |
Ex-div:- Payment:- £1=$1.58 | ||||
