Hey guys, just thought ide do a bit of a projected company future outlook/cash flow report for MYG to give a few guys some ideas about where MYG are heading etc.
This article is my opinion only and should not be taken as any type of financial advice. Please do your own research as per normal.
For use in this article, years stated are for calendar year(1st January - 31st December). Information used to start off 2013 year was projected cash at end of December qtr 2.7 million - plus added $2.0 in cash received from Sandstorm on 28/11/2012. Leaves us with 4.7 million in cash. Shares on issue include the issue of around 40million shares to be issued to Sandstorm for the $4.5million equity portion of the project finance from them - leaving us with around 510million shares on issue.
2013 Year
Cash On Hand 1st January: $4.7million Share Price 1st January: 11.0cents (510 million Shares) Market Capitalisation: 56.1million Debt: $11million
Year In Review:
-Mutiny starts plant construction after receiving balance of initial Sandstorm deposit of 7.5million. The balance of $29million is received from Sandstorm after final permitting is received and full project funding has been announced.
-Project funding with Credit Suisse is announced. Major points of this funding agreement are $50million for Deflector development. On top of project funding, they cover the cost of Accommodation Village via a leasing agreement.
-Mutiny enters into a hedging agreement to hedge a further 50000 oz of gold at around $AU1700 per ounce.
-In February a $3 million drilling campaign is kicked off to test extensions to Deflector. It is highly successful and will help boost Mutiny's production profile in the future.
-55 million options are exercised at 5cents on 23rd July - putting a further $2.75million into the cash pool.
-60million options are exercised at 14cents on 27 November giving the company a further $8.4million in cash.
-Deflector plant construction is completed on time and budget and first mining begins last quarter 2013.
Cash On Hand 31st December: $7.5million Share Price 31st December: 15.0cents (630 million Shares) Market Capitalisation: 94.5million Debt: 61million
2014 Year
Cash On Hand 1st January: $7.5million Share Price 1st January: 15.0cents (630 million Shares) Market Capitalisation: 94.5million Debt: $61million
Year In Review:
-Production starts at Deflector and first gold is poured. Cash flow is tight as gold recoveries are low due to initial mining of oxide ore. But even with mining of oxide ore, Mutiny still making nice margins.
-Mutiny produces around 45000 gold equivalent ounce for year. Gold price for 2013 averages around the $1650 per ounce mark. Sales revenue taking into account hedging and Sandstorm deal equates to $70 million. Total operating costs for mining operation is $52million. Admin costs total $5million for year.
-10million options exercised at 15cents. $1.5million in cash added to company coffers.
-Mutiny Kick off a major drilling campaign to further test extensions to Deflector. $6 million is spent on this 6 month campaign.
-$5million loan repayment made off Credit Suisse debt during year. $2.5 million charged in interest.
Cash On Hand 31st December: $11.0million Share Price 31st December: 19.0cents (640 million Shares) Market Capitalisation: 121.6 million Debt: 58.5million
2015 Year
Cash On Hand 1st January: $11.0million Share Price 1st January: 19.0cents(640 million Shares) Market Capitalisation: 121.6million Debt: $58.5million
Year In Review:
-Production is operating at 100% planned. Underground mining starts later in the year. Any initial problems encountered have been smoothed out. Better recoveries are experienced and higher grade ore is mined. Underground development costs of around $25million to be paid from company funds.
- Mutiny produces 75000 oz of gold for year. Average world gold price is assumed at $AU1700. Sales revenue taking into account hedging and Sandstorm deal equates to $117 million. Total operating costs for mining operation is $65million. Admin costs total $5million for year.
-Early in the year, Mutiny announces a small drill campaign of around $1-2 million to follow up on big drill campaign last year. It is to prove up further resources and reserves. Company announce significant resource and reserve increases during year after previous 2 major campaigns, and announce production guidance from 2016 year will be 100000+ ounces per year. This will require a capital outlay of some $35million, of which $4 million will come as part of Sandstorm Gold agreement.
- To help support the ramp up of production, a $10million loan facility is set up with a financial institution.
-Interest Charged on debt to be $4.0million for year.
Cash On Hand 31st December: $10.0million Share Price 31st December: 25.0cents (640 million Shares) Market Capitalisation: 160.0 million Debt: 72.5 million
2016 Year
Cash On Hand 1st January: $10.0million Share Price 1st January: 25.0cents(640 million Shares) Market Capitalisation: 160.0million Debt: $72.5million
Year In Review:
-Plant expansion is completed in 1st qtr. Underground mining is in full effect. High grade underground ore is hitting plant.
-With plant expansion, Mutiny is able to produce 100000 ounce of gold for year. World average gold price is assumed at $1750. Sales revenue taking into account hedging and Sandstorm deal equates to $158 million. Total operating costs for mining operation is $95million. Admin costs total $6million for year.
- Mutiny Gold announce they will take up the option to repay Sandstorm $25.0million to lower the amount of gold to be sold to Sandstorm at $500 ounce to just 7.5% of gold produced.
-Mutiny spend $6million on exploration for year, further increasing resources and reserves at Deflector. Mine life now extended to 10 years.
-Mutiny repays $20million of Credit Suisse debt. $4.0 million interest charged.
-Company Tax Payable Estimated At around $4million.
Cash On Hand 31st December: $12.0million Share Price 31st December: 28.0cents (640 million Shares) Market Capitalisation: 179.2 million Debt: 56.5 million
2017 Year
Cash On Hand 1st January: $12.0million Share Price 1st January: 28.0cents(640 million Shares) Market Capitalisation: 179.2million Debt: $56.5million
Year In Review:
- High grade underground ore continues to feed Mill. More deeper higher grade Deflector ore is being processed. Mutiny could easily have started mining from other nearby open pit deposits by now, but ill assume Deflector feed is 100%.
-Mutiny Gold produces 105000 ounces of gold. World average gold price is assumed at $1775. Sales revenue taking into account hedging and revised Sandstorm deal equates to $181 million. Total operating costs for mining operation is $95million. Admin costs total $6million for year.
- Flushed with Cash, Mutiny commence a ramped up ongoing exploration campaign mid-year. $10million is spent on exploration for remainder of year.
-Mutiny will need to pay in the vicinity of around 13-14million in income tax.
-Mutiny opt not to repay 100% debt, they payback $45million of debt. Interest charged of around $3million.
-Mutiny announce maiden dividend of 2.0cents per share.
Cash On Hand 31st December: $10.0million Share Price 31st December: 35.0cents (640 million Shares) Market Capitalisation: 224.0 million Debt: $14.5 million
2018 Year
Cash On Hand 1st January: $10.0million Share Price 1st January: 35.0cents(640 million Shares) Market Capitalisation: 224.00million Debt: $14.5million
Year In Review:
- Underground mining at Deflector continues to prove to be of very high grade. Increases grade of mines ore ups rate of production slightly.
- Mutiny Gold produces 110000 ounces of gold. World average gold price is assumed at $1750. Sales revenue taking into account hedging and revised Sandstorm deal equates to $183 million. Total operating costs for mining operation is $95million. Admin costs total $8million for year.
-Mutiny continue a year round exploration campaign. $15million is spent on Deflector extensions, Deflector resource and reserve drilling, as well as major money on other deposits such as Golden Stream, Rocksteady, Michaelangelo, Monarch and King Solomon. Also prelim work done on Brandy Hill Iron deposit, and their prospective Widgie South Nickel tenement.
-Mutiny complete payout of all company debt during year. Interest Charges of around 1 million for year. $15.5million debt facility paid out.
-Mutiny up their dividend to 3cents per share for year. $19million paid out in dividends.
- Income tax expense for year estimates at approximately $12million.
Cash On Hand 31st December: $28.0million Share Price 31st December: 40.0cents (640 million Shares) Market Capitalisation: 256.0 million Debt: NIL
2019 Year
Cash On Hand 1st January: $28.0million Share Price 1st January: 40.0cents(640 million Shares) Market Capitalisation: 256.00million Debt: NIL
Year In Review:
-Massive exploration campaigns over last 18 months have resulted in major increases to resources and reserves at Deflector. Increased production profile of 135000 per year scheduled. Capital Costs to increase plant size to be around $25million - to be paid from company funds. Life of Mine for Deflector substantially increased also.
-Other Gullewa deposits have initial resources confirmed. Studies to include these resources into future production profile also completed. Ore Feed from these deposits also increases Mutiny's Mill mine Life.
- Mutiny Gold produces 115000 ounces of gold. World average gold price is assumed at $1775. Hedging agreements have now been fullfilled. Sales revenue taking into account revised Sandstorm deal equates to $194 million. Total operating costs for mining operation is $100million. Admin costs total $8million for year.
- Mutiny continues year round exploration campaigns on all deposits. $15million spent on exploration during year.
- Company is cashed up and looking for acquisitions to support company expansion.
-Dividend increases to 4.0cents per share. $25 million paid out in dividends.
-Company tax estimated to be $16million.
Cash On Hand 31st December: $33.0million Share Price 31st December: 48.0cents (640 million Shares) Market Capitalisation: 307.2 million Debt: NIL
2020 Year
Cash On Hand 1st January: $33.0million Share Price 1st January: 48.0cents(640 million Shares) Market Capitalisation: 307.2million Debt: NIL
Year In Review:
-Full ramp up for plant expansion achieved. Mill feed from other Gullewa open pit deposits commenced to support expanded production. Note: Deflector could easily support this increase alone with future exploration.
-Mutiny Gold produces 135000 ounces of gold. World average gold price is assumed at $1800. Sales revenue taking into account revised Sandstorm deal equates to $230 million. Total operating costs for mining operation is $115million. Admin costs total $10million for year.
-Mutiny continues to pump money back into exploration to increase investor returns. More money to be spent on other deposits in the Gullewa tenements other than Deflector as they try to prove up a resource to support a further 10-15year mine cycle. $15million spent on exploration.
-Mutiny continues to make a priority the increase of returns to shareholders via dividends. Ups Dividend to 5cents a share. $32million paid out in dividends.
-Tax payable estimated at $20million.
Cash On Hand 31st December: $71.0million Share Price 31st December: 55.0cents (640 million Shares) Market Capitalisation: 352.0 million Debt: NIL
In summary, we are projecting to be a big-time gold company by year 2020. In my projections - you can see i have not been overly bullish/bearish on the gold proce, and kept it pretty steady of the projected time line.
Also - i have not included any potential revenue from White Wells project. As per ASX announcement dated 16/1/2012 - Cobra mining has notified Mutiny that they intend to start a mine at White Wells. Mutiny will be paid $750,000 upon all permits being given. Mutiny will receive 21% off all profits from the White Wells project mined by Cobra. White Wells currently has a resource of 113,000 ounces.
In my projections, i have tried to follow likely events that will occur based on my opinions, and also information released via the company over past ASX announcements. I am assuming figures released in company announcements are accurate and that the company can deliver on these targets.
I have not really made any assumptions regarding future revenue from future exploration and other corporate transactions. I have tried simply to project the future of the Gullewa tenement which MYG is currently focused on.
I have projected that at the End of 2020, not only will Mutiny be highly cash up and debt free, they will paying out a high return of dividends and still have a long projected mine life going forward. This obviously is reliant on their exploration expenditure proving up a resource and reserves on their current or future tenements.
Hopefully readers can find this of some use.
MYG Price at posting:
9.8¢ Sentiment: LT Buy Disclosure: Held
(20min delay)