It has been a long and bumpy ride for readers who followed our original buy advice on copper-gold explorer Bezant Resources (BZT), but it's all coming to a head soon.
In less than three months, Bezant could receive a huge $63m (£39.8m) payout from major gold miner Gold Fields should it exercise its option to buy the Mankayan project in the Philippines before 31 January 2013. Management have said they will return around half of the proceeds directly to shareholders if the deal goes through. That means shareholders stand to receive as much as 30p a share in a dividend next year.
Yet Bezant's malingering share price, currently 25p, suggests the market isn't counting on Gold Fields exercising the option. Indeed, if it doesn't, Bezant would be left with only a few million pounds in its treasury and an early-stage group of properties in Argentina, where investor sentiment is unfavourable at the moment following the recent renationalisation of YPF.
Bezant's management say they are in constant contact with Gold Fields and were greatly encouraged by the major miner's $220m investment earlier this year to acquire 40 per cent of the adjacent Far Southeast project. And while there remains the small possibility the option agreement will simply be extended, Bezant's future should be decided shortly - for better or for worse.
BEZANT RESOURCES (BZT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 25.5p | MARKET VALUE: | £16m | |
| TOUCH: | 25-25.5p | 12-MONTH HIGH: | 32p | LOW: 21.5p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 20p | NET CASH: | £4.3m | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | nil | -6.90 | -18.7 | nil |
| 2009 | nil | -1.77 | -4.5 | nil |
| 2010 | nil | -1.61 | -3.7 | nil |
| 2011 | nil | -1.55 | -2.9 | nil |
| 2012 | nil | -1.84 | -2.8 | nil |
| % change | - | - | - | - |
