Market cap of $250 million and cash of $124 million. I ignore...

Market cap of $250 million and cash of $124 million. I ignore the listed assets.

Doubling the half year profit of $12 million they are earning $24 million pa.

The current tin price in $A is around that in the June quarter and so above the half year average. So at the current tin price they might earn around $16 million in the current half as a rough estimate, or $28 million for the year. This is probably conservative as they flag higher production this half year.

So on the enterprise value of $126 million they are trading at 4.5 earnings.

The alternative is to say NPAT (not that they pay tax given the tax losses) of around 3 cps on a share price of 27.5 cps and a PE of 9.

Given the tax losses, cash flow is probably a better guide. They increased cash by $10 million in the half year, after spending around $20 million on plant and development. There are only $8 million in capital spending commitments outstanding in the accounts, so the increase in cash could jump in the current half year, perhaps to $20 million. That is not much different to the profit figure above, but suggests the cash balance could be close to $145 million by year end even without much production increase. The enterprise value would be only $100 million and they would be trading at near 3 times cash flow and earnings (of around $30 million) by year end at the current share price.

If you annualised the second half profits/ cash flow and assume higher production in 2024 at the current tin price they are even cheaper as the cash build rapidly reduces the enterprise value.

So very cheap, but what is going to change the share price while a major holder is selling? The next quarterly may show a jump in production and the cash balance, but it is hard to see even that doing much for the share price, until the share overhang is gone. I leave it as a hold (and hope).