just saying, page-12

Here's a piece about Atrum Coal in today's AFR. Very positive. The AFR is free in January if you want to see the original.


ATRUM COAL
Atrum Coal achieved the third-highest share price growth of the five companies selected with a gain of 612 per cent, an outstanding performance in a sector that declined 3.7 per cent in 2013. Atrum’s share price gain was the second largest of all stocks in the materials sector, including those with market capitalisations of less than $100 million.

The fact that the company is still in the process of developing its cornerstone British Columbia-based Groundhog anthracite project, with meaningful production not expected to commence until 2015-16 and a maiden profit likely to be delivered in 2016-17, highlights the value of its assets.

When the company delivers its first production at full tilt, analysts at Shaw Stockbroking forecast a net profit of $104.3 million, representing earnings per share of 60¢ on a fully diluted basis. While these are forward-looking figures, they are very impressive and definitely support Shaw’s 12-month price target of $2.25.

In the interim Atrum is cashed up and ready to move to development. And the potential spin-off of non-Groundhog greenfield assets should further bolster cash reserves. Early-stage small volume production will also assist in funding the project.

Managing director Eric Lilford, who has a substantial stake in Atrum, told Smart Investor that the company was on track to meet its goal of taking Groundhog to first production on the smell of an oily rag. He said that the company has secured 1.5 million tonnes per annum of port capacity on non-take or pay terms, providing substantial economic security as well as locking in key infrastructure arrangements.

Anthracite is even more valuable than coking coal and according to ­Lilford, Atrum has the largest deposit of its kind in the world. The company’s market capitalisation is currently in the order of $160 million, but analysts at Bell Potter are of the view that this could swell to $500 million or $2.88 per share as milestones are met.