So I punched in your numbers ($4140/oz) into my model and got largely the same result (EBITDA $2,108M vs your $2,066). Taking expected quarter values ($5100/oz, $16,000/Tonne Cu) I'm getting EBITDA of $2991M (this will be for a full year at this, not expecting this FY25 but is my base case for FY26 until they put out guidance).
Jun QTR if they hit similar production (180k gold, 19k copper), and hit capex guidance etc I'm expecting about $280M Group Cash flow (Mar - $207M)
EVN dividend policy is 50% of cashflow. If we look at the full year as being $760M (if they hit my estimate of $280M for Jun QTR) 50% pay-out implies 19c for FY dividend or a $0.12c final dividend taking into account the $0.07 already paid. This will be the bulk of the cash from the qtr paid out ($238M) in dividends and we won't see net debt drop below $1B this FY (but will be close).
Looking at FY26, if we just assume it is going to look like four times the Jun QTR, we have the aforementioned nearly $3B EBITDA, $1,120M in Group cashflow and FY26 dividends of 28c assuming spot stays static. At $7.80 a share that's 5.5 times EV/Cashflow. (I dislike PE for mining companies due to high depreciation and funny business).
If we further assume no growth (there will be) by the end of FY27 we will have a debt free company and more cash than they knows what to do with.
Selfishly what I would REALLYlike to see at the FY results is the institution of a buyback. Instead of a 12c final dividend, keep a 7c final dividend and redirect the difference into a $100M buyback. No one is going to quibble about a 14c total div payment.
EVN is my largest holding, however (and I lucked out here) bought my first parcel of NST as a result of their buyback program at $7.30 (wish I did more then...) EVN has the cashflow, we are undervalued IMO and we can bring in a small buyback and maintain a healthy dividend payment to keep the boomers happy while still sticking to the existing policy of 50% cashflow returned to shareholders.
I severely doubt JK is reading hot copper posts in his spare time, but mate if you are... Do a buyback.
Add to My Watchlist
What is My Watchlist?
