This should run hard tomorrow but it does not inspire me. MGO...

This should run hard tomorrow but it does not inspire me.

MGO would be lucky to produce at AUS$1.15 lb.

My guess work.

110,000 tonnes per annum copper equivalent expanding to 220,000 tonnes per annum



498 million shares on issue, with cash reserves of approximately A$24 million



Capital estimate of approximately US$1Bn or AUS$1.2B.



2013 commissioning



Annual revenue at US$2.85lb and 85 cent exchange rate = US$812M



Costs AUS$1.15lb. EBITA = AUS$530M NPAT = $300



Raise $600M at 50 cents per share. Shares on issue at production = 2,000 million.



EPS = 15 cents 2013 share price target = $1.50



Gain per annum on 15 cents buy today = 200%+ on based production of 110,000 tonnes per annum



Then double rate of production to 220,000 tpa for double the EPS.




However, I think this is risky.

I doubt they can produce at AUS$1.15 per pound.

If copper is US$2.50 lb and costs $1.50lb, margin is $1.45 lb

EBITDA is $350M. NPAT = $200M EPS on 2,400 million shares = 10 cents or less. Maybe 8 cents.

DYOR. BYOB.