Highlights from the research:Once in production, annual...

Highlights from the research:

Once in production, annual attributable EBITDA of >$60m suggest PMY could demand a 3-4x EV/EBITDA implying a share price of >$0.08/sh on a fully developed basis.

At this stage we don’t consider the expansion potential which, if sufficient resource is defined, could significantly enhance the valuation.

The key assumption in this process is the ability to successfully beneficiate the ore. The PFS assumed an uplift factor of 2.12x for an ore loss of 10%.
- The sensitivity on the uplift factor is large – if a 2.5x uplift could be achieved the pre tax NPV would increase to >$300m.
- Actual is much better = 3.36x in fresh ore and 2.15x in the oxide (83% of the ore is 'fresh')

We see potential upside for the Indicated resource to increase to >15mt which could justify a plant expansion to 1.5mtpa, producing ~ 45-50kt of Pb and 1.6moz of Ag pa and similar margins.