The Aim 100 2018: 100 to 91

The Aim 100 2018: 100 to 91

100. Base Resources

An unfortunate ticker aside, there’s a lot about Base Resources’ (BSE) investment case that looks good on paper. Kwale, the group’s ageing mineral sands project in Kenya, is currently throwing off cash. In the six months to December, zircon prices were sufficiently high for Base to both cut A$51.7m (£28.2m) from its debt pile and pay for a costly stage-two optimisation programme, which should – touch wood – wring out the last of the project’s ore reserves by 2022. So long as titanium dioxide feedstocks remain in a structural supply deficit, there should be plenty more cash generation in the years until then. Analysts at Numis expect post-tax profit of A$59.6m this year, and A$57.4m in the 12 months to June 2019.

For those investors who were wondering what Base plans to do over the next decade, the group now has an answer – the Toliara Sands project in Madagascar, which Base acquired for a minimum $75m. The bad news, in our book, is the risk involved in relying on a project that is not forecast to enter production until mid-2021. Hold. AN

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