Auriant Mining

OMX: AUR

SEK313.7m market cap

SEK3.18 last close

Auriant Mining is a Swedish junior gold mining company focused on Russia. It has two producing mines (Tardan and Solcocon), one advanced exploration property (Kara-Beldyr) and one early stage exploration property (Uzhunzhul).

Investment summary

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. Production guidance of 900–940kg Au for FY20 compares with production of 689kg in FY19, 115kg in January 2020 alone (1,380kg annualised) and our forecast of 953kg.

Y/E Dec
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2018A 17.4 (1.7) (10.2) (10.8) N/A 7.6
2019A 29.8 7.2 (2.2) (1.2) N/A 3.5
2020E 51.3 26.8 16.3 6.0 5.4 2.0
2021E 43.0 19.9 12.5 5.0 6.5 3.0
Industry outlook

On the basis that Auriant raises US$40m in equity at a price of SEK3.69/share, we estimate that it is capable of generating average cash flows of US$49.2m and EPS of 21.0c 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, the company is actively managing its dispute with Rosprirodnadzor (reported 20 August).

Last updated on 03/04/2020
Share price graph
Balance sheet
Forecast net debt (US$m) 47.9
Forecast gearing ratio (%) 194
Price performance
%
1m
3m
12m
Actual (13.8) (8.9) 30.3
Relative* 6.2 17.7 49.3
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