Auriant Mining

OMX: AUR

SEK530.7m market cap

SEK5.38 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. In Q120 (the first full quarter of CIL operations) this change resulted in an increase in metallurgical recoveries of c 40pp to 91.7% and an approximate halving in cash costs to US$476/oz sold. At the same time, Auriant 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. Official production guidance of 900–940kg Au for FY20 compares with our updated full-year forecast of 960kg (cf 953kg previously).

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 13.4
2019A 29.8 7.2 (2.2) (1.2) N/A 6.2
2020E 57.0 29.3 15.8 9.9 5.8 3.2
2021E 43.0 19.9 13.1 5.8 10.0 4.6
Industry outlook

On the basis that Auriant raises US$40m in equity at SEK4.40/share, we estimate that it is capable of generating average cash flows of US$49.4m and EPS of 23.0c pa in the period FY25–33. Discounted at 10% pa, we value the resulting (maximum potential) stream of dividends to shareholders at US$0.83/share. This almost doubles to US$1.45/share in the event the gold price remains at c US$1,705/oz.

Last updated on 15/07/2020
Share price graph
Balance sheet
Forecast net debt (US$m) 40.8
Forecast gearing ratio (%) 137
Price performance
%
1m
3m
12m
Actual 25.1 32.8 99.3
Relative* 14.3 9.1 80.4
52-week high/low SEK5.6/SEK2.7
*% relative to local index
Key management
Peter Daresbury Chairman
Sergey Ustimenko CEO
Katerina Popova Head of PR&IR