fair value for AGO, page-4

So according to my predictions last week & the actuals I was almost spot on & slightly conservative:-
Rev: up from A$372mil to 498mil, my call $490M (1% difference)
Margin: up from 30m to 102mil, my call $64M (40% higher)
EBITDA: up from 20.5 to 66.2mil, my call $42M (50% higher)
EBIT: up from -26.8m to 25.38, my call $22M (10% diff)
statutory PAT: up from -114 to 18.91 mil, my call +$22M (5% diff)
Cashflow: up from 14.1 to A$94.4 mil, my call +$100Mpa (5% diff)
Shipment: 8.1 MT correct (0% diff)
Av PIO: A$61/t, actual $66 even better (9% diff)
Full Costs/AISC: A$51.75/t, actual 52.30, close to spot on (2% diff)
Debt payments, +$22M extra, none extra, surprising
Profit after Tax 22M (after impairments & writedowns), actual $18.9M, similar (10% diff)

On current IO price, this means  a running margin now -
94/0.77 = 122 x0.57=$70 - $52.30 = $17.70 per WMT x 16Mpa=
$283Mpa free cashflow or $24M per month

With annual sales of AUS$996M pa, free cashflow of $283M pa, strong margin of (17.7/52.3) = 34%, lowering costs and surplus cash
One has to compare it to MINRES which has double the sales income, quadruple the cash and no debt with a $2.1B MCap. On this basis AGO ought to be valued at a MCap of $1B triple the current AGO Mcap or 11c

Thats right 11c!

To get there and match MINRES it needs to
- pay off all debt
- increase cash at bank
- increase production at this margin
- lower costs slightly more
AGO can do it and its undervalued, expect a run to 5c again if IO price stays around here.