Last close As at 05/08/2026
AUD1.47
▲ 0.05 (3.53%)
Market capitalisation
AUD1,934m
Research: Metals & Mining
Alkane Resource’s FY23 financial results were broadly in line with our forecasts, with profit after tax totalling A$42.5m (compared to our forecast of A$44.0m) and EPS of 7.10c (cf 7.38c). Cash flows from operations exceeded our forecasts (A$95.5m cf A$75.6m) as a result of an increase in deferred tax liabilities, albeit this was balanced by higher exploration capex of A$58.1m to result in a net cash flow of A$4.1m (cf A$2.4m). Following FY23 production of 70,253oz at an all-in sustaining cost (AISC) of A$1,602/oz, FY24 guidance for Tomingley is 60,000–65,000oz at an AISC of A$1,750–2,100/oz. Our forecasts remain largely unchanged in the aftermath of Alkane’s FY23 results. We maintain our valuation.
Alkane Resources |
The Bodas continue to grow |
FY23 financials |
Metals and mining |
25 August 2023 |
Share price performance
Business description
Next events
Analysts
Alkane Resources is a research client of Edison Investment Research Limited |
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Alkane Resource’s FY23 financial results were broadly in line with our forecasts, with profit after tax totalling A$42.5m (compared to our forecast of A$44.0m) and EPS of 7.10c (cf 7.38c). Cash flows from operations exceeded our forecasts (A$95.5m cf A$75.6m) as a result of an increase in deferred tax liabilities, albeit this was balanced by higher exploration capex of A$58.1m to result in a net cash flow of A$4.1m (cf A$2.4m). Following FY23 production of 70,253oz at an all-in sustaining cost (AISC) of A$1,602/oz, FY24 guidance for Tomingley is 60,000–65,000oz at an AISC of A$1,750–2,100/oz. Our forecasts remain largely unchanged in the aftermath of Alkane’s FY23 results. We maintain our valuation.
Year end |
Revenue (A$m) |
PBT* |
EPS* |
DPS |
P/E |
Yield |
06/22 |
165.0 |
52.1 |
3.68 |
0.00 |
18.1 |
N/A |
06/23 |
190.0 |
60.6 |
7.10 |
0.00 |
9.4 |
N/A |
06/24e |
172.4 |
63.0 |
7.34 |
0.00 |
9.1 |
N/A |
06/25e |
229.3 |
80.6 |
9.39 |
0.00 |
7.1 |
N/A |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
Potential to be a tier one asset
Drilling at the Boda, Boda Two and Boda Three deposits is complete, with final assay results expected in September, and further drilling is now solely focused on the Kaiser deposit. Current feedback from the Boda Two and Three deposits suggests a greater upside than previously estimated following positive results in favourable geology. Mineralisation at depth remains open down dip and along strike, sitting outside of the western boundary of the current Boda mineral resource estimation. Further drilling is required to build on the new assay data. As per our last note, we expect Alkane to produce an updated mineral resource estimate for Boda, including Boda Two and Three, in Q4 CY23 and for Kaiser in Q1 CY24. Following completion of the Boda exploration programme, Alkane believes the system could represent a possible tier one gold-copper project.
Valuation: A potential valuation of A$2.27/share
Following its results, our valuation of Tomingley remains unchanged at A$0.60/share. Liquid assets in the form of Alkane’s holdings in Calidus and Genesis contribute a further A$0.03/share, with Boda and Kaiser estimated at a combined US$174.8m (US$0.29/share or A$0.44/share) to Alkane, either as an in-situ resource or as a development project. This represents a total value estimate for Alkane of A$1.06/share. We also estimate a potential A$0.52/share additional upside in the event of further exploration success in the Northern Molong Porphyry Project at the Boda Two and Three deposits. Including all other contingent assets (and using current metals spot prices cf Edison’s more conservative long-term prices), this takes Alkane’s valuation to potentially as high as A$2.27/share. Otherwise, in Alkane, investors can buy a profitable, cash generating company at a rating of US$23.05 per resource ounce – ie little more than that of a cash consuming explorer.
Exhibit 1: Financial summary
A$’000s |
2018 |
2019 |
2020 |
2021 |
2022 |
2023 |
2024e |
2025e |
|||
Year end 30 June |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
|||
INCOME STATEMENT |
|||||||||||
Revenue |
|
|
129,973.6 |
93,994.9 |
72,549.0 |
127,833.0 |
165,010.0 |
190,527.0 |
172,421.5 |
229,304.3 |
|
Cost of Sales |
(51,080.9) |
(53,656.4) |
(32,868.0) |
(45,313.0) |
(67,527.0) |
(83,496.0) |
(87,880.1) |
(127,631.8) |
|||
Gross Profit |
78,892.7 |
40,338.5 |
39,681.0 |
82,520.0 |
97,483.0 |
107,031.0 |
84,541.4 |
101,672.5 |
|||
EBITDA |
|
|
70,378.7 |
32,971.7 |
29,412.0 |
70,527.0 |
87,498.0 |
94,924.0 |
72,434.4 |
89,565.5 |
|
Normalised operating profit |
|
|
31,658.3 |
25,808.8 |
20,171.0 |
49,940.0 |
53,821.0 |
59,246.0 |
61,989.4 |
79,120.5 |
|
Reported operating profit |
31,658.3 |
25,808.8 |
20,171.0 |
49,940.0 |
53,821.0 |
59,246.0 |
61,989.4 |
79,120.5 |
|||
Net Interest |
(579.0) |
(418.8) |
389.0 |
(2,741.0) |
(1,662.0) |
1,341.0 |
1,001.2 |
1,457.0 |
|||
Joint ventures & associates (post tax) |
0.0 |
0.0 |
0.0 |
(870.0) |
(20.0) |
0.0 |
0.0 |
0.0 |
|||
Exceptionals |
0.0 |
0.0 |
(646.0) |
1,741.0 |
48,334.0 |
0.0 |
0.0 |
0.0 |
|||
Profit before tax (norm) |
|
|
31,079.3 |
25,390.0 |
20,560.0 |
46,329.0 |
52,139.0 |
60,587.0 |
62,990.5 |
80,577.5 |
|
Profit before tax (reported) |
|
|
31,079.3 |
25,390.0 |
19,914.0 |
48,070.0 |
100,473.0 |
60,587.0 |
62,990.5 |
80,577.5 |
|
Reported tax |
(6,919.9) |
(2,266.1) |
(6,569.0) |
(14,503.0) |
(30,222.0) |
(18,137.0) |
(18,897.2) |
(24,173.3) |
|||
Profit after tax (norm) |
24,159.4 |
23,123.9 |
13,991.0 |
31,826.0 |
21,917.0 |
42,450.0 |
44,093.4 |
56,404.3 |
|||
Profit after tax (reported) |
24,159.4 |
23,123.9 |
13,345.0 |
33,567.0 |
70,251.0 |
42,450.0 |
44,093.4 |
56,404.3 |
|||
Minority interests |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Discontinued operations |
0.0 |
0.0 |
(583.0) |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Net income (normalised) |
24,159.4 |
23,123.9 |
13,991.0 |
31,826.0 |
21,917.0 |
42,450.0 |
44,093.4 |
56,404.3 |
|||
Net income (reported) |
24,159.4 |
23,123.9 |
12,762.0 |
33,567.0 |
70,251.0 |
42,450.0 |
44,093.4 |
56,404.3 |
|||
Basic average number of shares outstanding (m) |
506 |
506 |
547 |
595 |
596 |
598 |
601 |
601 |
|||
EPS – basic normalised (A$) |
|
|
0.05 |
0.05 |
0.03 |
0.05 |
0.04 |
0.07 |
0.07 |
0.09 |
|
EPS – diluted normalised (A$) |
|
|
0.05 |
0.04 |
0.02 |
0.05 |
0.04 |
0.07 |
0.07 |
0.09 |
|
EPS – basic reported (A$) |
|
|
0.05 |
0.05 |
0.02 |
0.06 |
0.12 |
0.07 |
0.07 |
0.09 |
|
Dividend (A$) |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
0.00 |
|||
Revenue growth (%) |
10.3 |
(-27.7) |
(-22.8) |
76.2 |
29.1 |
15.5 |
(-9.5) |
33.0 |
|||
Gross margin (%) |
60.7 |
42.9 |
54.7 |
64.6 |
59.1 |
56.2 |
49.0 |
44.3 |
|||
EBITDA margin (%) |
54.1 |
35.1 |
40.5 |
55.2 |
53.0 |
49.8 |
42.0 |
39.1 |
|||
Normalised operating margin (%) |
24.4 |
27.5 |
27.8 |
39.1 |
32.6 |
31.1 |
36.0 |
34.5 |
|||
BALANCE SHEET |
|||||||||||
Fixed assets |
|
|
138,275.0 |
172,196.0 |
129,077.0 |
203,161.0 |
257,497.0 |
304,826.0 |
318,451.0 |
317,576.0 |
|
Intangible assets |
93,136.0 |
103,894.0 |
32,745.0 |
57,794.0 |
98,498.0 |
161,310.0 |
171,310.0 |
181,310.0 |
|||
Tangible assets |
36,266.0 |
51,038.0 |
62,322.0 |
99,411.0 |
107,386.0 |
111,104.0 |
114,729.0 |
103,854.0 |
|||
Investments & other |
8,873.0 |
17,264.0 |
34,010.0 |
45,956.0 |
51,613.0 |
32,412.0 |
32,412.0 |
32,412.0 |
|||
Current assets |
|
|
93,306.0 |
76,501.0 |
59,096.0 |
33,054.0 |
98,190.0 |
107,364.0 |
121,547.4 |
182,093.9 |
|
Stocks |
19,153.0 |
4,816.0 |
7,647.0 |
11,648.0 |
17,952.0 |
21,906.0 |
6,613.4 |
8,795.2 |
|||
Debtors |
2,030.0 |
1,998.0 |
2,940.0 |
1,894.0 |
2,344.0 |
5,167.0 |
4,251.5 |
5,654.1 |
|||
Cash & cash equivalents |
72,003.0 |
69,582.0 |
48,337.0 |
18,991.0 |
77,894.0 |
80,291.0 |
110,682.5 |
167,644.6 |
|||
Other |
120.0 |
105.0 |
172.0 |
521.0 |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Current liabilities |
|
|
(27,430.0) |
(21,762.0) |
(14,238.0) |
(18,179.0) |
(25,297.0) |
(43,701.0) |
(27,416.0) |
(30,683.3) |
|
Creditors |
(9,299.0) |
(8,007.0) |
(9,425.0) |
(11,082.0) |
(13,708.0) |
(23,508.0) |
(7,223.0) |
(10,490.3) |
|||
Tax and social security |
(6,929.0) |
(9,317.0) |
0.0 |
0.0 |
(1,001.0) |
(7,283.0) |
(7,283.0) |
(7,283.0) |
|||
Short-term borrowings |
0.0 |
0.0 |
(2,090.0) |
(3,294.0) |
(5,930.0) |
(7,371.0) |
(7,371.0) |
(7,371.0) |
|||
Other |
(11,202.0) |
(4,438.0) |
(2,723.0) |
(3,803.0) |
(4,658.0) |
(5,539.0) |
(5,539.0) |
(5,539.0) |
|||
Long-term liabilities |
|
|
(13,647.0) |
(13,059.0) |
(19,522.0) |
(26,471.0) |
(61,516.0) |
(68,492.0) |
(68,492.0) |
(68,492.0) |
|
Long-term borrowings |
0.0 |
0.0 |
(4,515.0) |
(5,922.0) |
(9,116.0) |
(6,175.0) |
(6,175.0) |
(6,175.0) |
|||
Other long-term liabilities |
(13,647.0) |
(13,059.0) |
(15,007.0) |
(20,549.0) |
(52,400.0) |
(62,317.0) |
(62,317.0) |
(62,317.0) |
|||
Net assets |
|
|
190,504.0 |
213,876.0 |
154,413.0 |
191,565.0 |
268,874.0 |
299,997.0 |
344,090.4 |
400,494.6 |
|
Minority interests |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Shareholders' equity |
|
|
190,504.0 |
213,876.0 |
154,413.0 |
191,565.0 |
268,874.0 |
299,997.0 |
344,090.4 |
400,494.6 |
|
CASH FLOW |
|||||||||||
Operating cash flow before WC and tax |
69,941.3 |
33,135.8 |
28,173.0 |
72,065.0 |
137,248.0 |
95,354.0 |
72,864.4 |
89,995.5 |
|||
Working capital |
(9,498.0) |
(5,172.0) |
(3,481.0) |
(2,840.0) |
(776.0) |
(3,948.0) |
(76.9) |
(317.1) |
|||
Exceptional & other |
1,277.0 |
1,454.0 |
3,704.0 |
4,632.0 |
(48,334.0) |
3,500.0 |
0.0 |
0.0 |
|||
Tax |
(6,919.9) |
7,047.9 |
(249.0) |
0.0 |
0.0 |
(701.0) |
(18,897.2) |
(24,173.3) |
|||
Net operating cash flow* |
|
|
54,800.5 |
36,465.7 |
28,147.0 |
73,857.0 |
88,138.0 |
94,205.0 |
53,890.3 |
65,505.1 |
|
Capex |
(9,224.0) |
(19,621.0) |
(46,122.0) |
(59,477.0) |
(42,581.0) |
(33,695.0) |
(14,500.0) |
0.0 |
|||
Acquisitions/disposals |
0.0 |
4.0 |
(20,068.0) |
1,522.0 |
619.0 |
4.0 |
0.0 |
0.0 |
|||
Net interest |
(579.0) |
(418.8) |
389.0 |
(2,741.0) |
(1,662.0) |
1,341.0 |
1,001.2 |
1,457.0 |
|||
Equity financing |
(5.0) |
0.0 |
39,442.0 |
(31.0) |
(4.0) |
(20.0) |
0.0 |
0.0 |
|||
Exploration and Evaluation |
(10,969.0) |
(11,578.0) |
(20,132.0) |
(26,642.0) |
(40,935.0) |
(58,105.0) |
(10,000.0) |
(10,000.0) |
|||
Other |
(4,317.0) |
(7,442.0) |
(9,522.0) |
(18,129.0) |
49,659.0 |
368.0 |
0.0 |
0.0 |
|||
Net cash flow |
29,706.4 |
(2,590.1) |
(27,866.0) |
(31,641.0) |
53,234.0 |
4,098.0 |
30,391.5 |
56,962.1 |
|||
Opening net debt/(cash) |
|
|
(41,969.0) |
(72,003.0) |
(69,582.0) |
(41,732.0) |
(9,775.0) |
(62,848.0) |
(66,745.0) |
(97,136.5) |
|
FX |
311.6 |
169.1 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Other non-cash movements |
16.0 |
0.0 |
16.0 |
(316.0) |
(161.0) |
(201.0) |
0.0 |
0.0 |
|||
Closing net debt/(cash) |
|
|
(72,003.0) |
(69,582.0) |
(41,732.0) |
(9,775.0) |
(62,848.0) |
(66,745.0) |
(97,136.5) |
(154,098.6) |
|
Source: Company sources, Edison Investment Research. Note: *Net operating cash flow excludes net interest, which can be found in isolation three lines lower.
|
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Research: Healthcare
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