Auriant Mining

OMX: AUR

SEK330.5m market cap

SEK3.35 last close

Auriant is a Swedish gold company, focusing on exploration and production in Russia. It has two producing mines (Tardan in Tyva and Solcocon in Zabaikalsky), one advanced exploration property (Kara-Beldyr in Tyva) and one early-stage exploration property (Uzhunzhul in Khakassia).

Investment summary

After seven years of gold production via other methods, Auriant’s Tardan plant has been remodelled to a single carbon-in-leach process, which is forecast to improve metallurgical recoveries and reduce total cash costs by approximately a third each from 18 November when it was commissioned. At the same time, it is completing a DFS on Kara-Beldyr and, combined, the two are expected to achieve management’s goal of c 3t (96.5koz) of gold output pa from FY24 (cf guidance of 700–750kg in FY19e and 900–940kg in FY20e).

Y/E Dec
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (c)
P/E (x)
P/CF (x)
2017A 33.5 8.8 (3.1) (5.8) N/A 1.3
2018A 17.4 (1.7) (10.2) (10.9) N/A 8.2
2019E 33.2 8.8 (0.1) 1.8 19.6 2.8
2020E 56.2 31.2 21.3 9.7 3.6 2.1
Industry outlook

On the basis that Auriant raises US$40m in equity at a price of SEK3.50/share, we estimate that it is capable of generating average cash flows of US$48.5m and EPS of 19.8c pa in the period FY25–33. Discounted at 10% pa, we value the resulting (maximum potential) stream of dividends to shareholders at US$0.72/share. In the meantime, Auriant is actively managing its dispute with Rosprirodnadzor (reported on 20 August).

Last updated on 19/02/2020
Share price graph
Balance sheet
Forecast net debt (US$m) 75.2
Forecast gearing ratio (%) 352
Price performance
%
1m
3m
12m
Actual 1.5 (1.5) 26.4
Relative* (2.8) (11.8) 1.3
52-week high/low SEK4.0/SEK2.2
*% relative to local index
Key management
Peter Daresbury Chairman
Sergey Ustimenko CEO
Katerina Popova Head of PR&IR