Freegold Ventures

CN: FVL

CA$18m market cap

CA$0.1 last close

Freegold’s focus is on copper and gold exploration near Fairbanks, Alaska. It holds both the Golden Summit project (on which a PEA was completed in January 2016) and the Shorty Creek copper–gold porphyry project, where potential by-products include gold, silver, cobalt and tungsten.

Investment summary

Tetra Tech’s preliminary economic assessment of Golden Summit demonstrated a post-tax internal rate of return of 20% and a net present value (NPV) of US$188m (US$0.99 per existing Freegold share) at a gold price of US$1,300/oz. At US$1,400/oz the NPV was US$265m (US$1.40/sh) and, at a US$1,500/oz Au, we estimate that it would be US$342m (US$1.81/sh). Fully diluted, we value the stream of dividends from the development of the Golden Summit project (at a 10% discount rate) at US$0.13/share currently. However, this increases to c 18.8c/share in the event that Freegold is able to double its oxide resource to 1.2Moz; there is also potential to identify areas that host higher grade material.

Y/E Dec
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (c)
P/E (x)
P/CF (x)
2017A 0.0 (0.6) (0.6) (0.4) N/A N/A
2018A 0.0 (0.8) (0.8) (0.4) N/A N/A
2019E 0.0 (0.8) (0.9) (0.5) N/A N/A
2020E 0.0 (0.8) (1.3) (0.7) N/A N/A
Last updated on 13/09/2019
Industry outlook

FVL (as operator) has commenced drilling at Shorty Creek where South32 is providing up to US$30m in funding for a 70% interest in the project. In addition to the targets already drilled, FVL is focusing on the outlying areas of the project with the intention of proving up its district scale potential.

Last updated on 13/09/2019
Share price graph
Balance sheet
Forecast net debt (US$m) 1
Forecast gearing ratio (%) 3
Price performance
%
1m
3m
12m
Actual 26.7 90.0 46.2
Relative* 24.2 85.0 40.2
52-week high/low C$0.1/C$0.0
*% relative to local index
Key management
Gordon Steblin CFO
Alvin Jackson VP Exploration & Development
Kristina Walcott President & CEO