Thanks for the great analysis. I would have thought majority of...

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at6568

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02/03/23

14:08

Post #: 66562934
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Originally posted by paulgf: ↑

I wouldnt think this has caused recent weakness. More to do with the good run up and a period of consolidation as all shares do. The met coal price has come off fractionally too, was heading to $ 400 USD per Ton but now back sitting closer to $ 350 / Ton. This issue about the buyback in GEAR is really background noise in my view to Stanmore itself. This Raper guy has a fair argument but its between him, the Singapore regulators and GEAR. To the extent Asic is probing if insider trading laws have been breached is probably not a bad thing as will ensure probably higher transparency by SMR board going forward.

Raper's estimate is well off in my view of his assessment of earnings this year of $ 800 M - $ 1.20 BN. They will blow that away in heartbeat if the coking coal price stays where it is. We are around $ 350 USD per tonne. Lets be conservative and say $ 300 USD average across the whole year ( Stanmore runs on the singapore financial year of Jan to Dec , to align with its major shareholder GEAR) , which @ 0.70 AUD/USD = $ 428 per Ton .

Take off the ridiculous Qld govt royalty which on those figures would be about $ 100 / Tonne and you still have $ 328 price net of royalty - $ 130 per tonne in cash costs to mine to give a margin somewhere around $ 200 per tonne, maybe just under. On 12.50 MT annual production that is $ 2.50 BN and allowing for corporate tax comes back $1.75 BN, or about $ 2.00 per share in earnings, way above Raper's estimates. His estimate of a possible dividend I think is about right though if you work on a 25 % payout ratio which is where I think they will initially head to to allow something to be held back for possible capex and M&A. That would give around 50 cents per share.

One thing to remember with Gear is that they are a non - resident shareholder , hence they dont get the benefit of the franking credit applied of 30 % for tax paid by the company to the ATO. Its just a dead weight tax loss to them. They are not subject to however additional income tax or withholding tax on it on it in Australia and the Singapore FTA with Australia would prevent double taxation in Singapore. So the Gear shareholders have no "additional" incentive to want a higher payout ratio say compared to an aussie retail investor who wants to use those franking credits to even claw back some of the coy tax paid as it might be higher than their marginal rate. So if there are M&A opportunities likely GEAR controlled board more interested in those and growing company then feeding themselves back large dividends in the long run.

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Thanks for the great analysis. I would have thought majority of retails who bought into SMR aren't really income seeker but growth focus? We all know this stock should be at least $5....

SMR Price at posting: $3.72 Sentiment: Buy Disclosure: Held
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(20min delay)
Last $1.89		Change 0.005(0.27%)		Mkt cap ! $1.687B

Open	High	Low	Value	Volume
$1.86	$1.89	$1.84	$859.2K	459.4K

Buyers (Bids)

No.	Vol.	Price($)
8	3912	$1.89

Sellers (Offers)

Price($)	Vol.	No.
$1.89	13437	15

View Market Depth

No.	Vol.	Price($)
16	6840	1.880
20	14725	1.875
20	27777	1.870
15	55940	1.865
9	32844	1.860

Price($)	Vol.	No.
1.885	8237	9
1.890	14595	15
1.895	12716	10
1.900	21981	10
1.905	45363	10

Last trade - 12.09pm 20/06/2025 (20 minute delay)

SMR (ASX) Chart

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