Red lake was the biggest non-performer for me last quarterly. So...

Red lake was the biggest non-performer for me last quarterly. So much so that I actually think EVN is at risk of missing guidance if there is no improvement to RL for the March Q. Will be watching RL very closely in the coming March Q around 18/04/2024.

Despite a big miss at Red Lake Dec Q, EVN maintained its plan to hit the lower end of a forecast 789,000oz +-5% (750,000oz at the low range) in FY24. I've discounted my expectations already as I think EVN will only deliver 725,000oz in this financial year worse case.

Despite my discounting with current spot prices (A$3,500/oz gold and US$4/lb copper on a 30% Cu profile) it will mean a lift in earnings per share for EVN from 19.7c to 22.7c in FY2024!

FY2025 29.2c to 35.8c EPS if Cu and Au prices stays at current levels FY25. To put that into perspective Operating EBITDA would peak at $1.78b in FY25, more than double 2023 levels. The net debt would also fall to $1.2Bn or 40% Debt to Equity.

For me there is renewed optimism in my EVN holding even if they miss guidance for FY24. FY25, if current Au and Cu stays at these elevated levels and EVN hits 35.8c EPS then at $4.50 a pop EVN is only trading at 12.56 PE and that is historically cheap for EVN. $7 a pop would bring it closer to historical average of 18 PE.