Hartleys: Date 1 August 2008 ASX Code AGO Share Price 266cps Valuation 505cps Market Cap (fully diluted) $762.6m ($892.4m) Issued Capital (fully diluted) 286.7m shares (335.5m) Cash (as at 30 June 2008) $143m Management David Nixon (Chairman) David Flanagan (Managing Director) David Hannon (Non-Exec. Director) Jyn Sim Baker (Non-Exec. Director) Geoff Clifford (Non-Exec. Director) Top Shareholders IMC Group Australia (19.9%) LinQ Resource Fund (6.4%) Black Rock (6.2%) Resources Analyst Andrew Muir Ph: +61 8 9268 3045 [email protected] Atlas Iron Limited (“Atlas”, “AGO”, “Company”) continues to advance its Pilbara iron ore projects with a 68% increase in its hematite resources, a 54% increase in its magnetite resource, a 37% increase in the Pardoo reserve, an initial reserve for Abydos, and the completion of its prefeasibility study into the development of Abydos. The resource upgrade to Ridley magnetite was close to our expectations, though the new exploration target size has surprised on the upside, and indicates the potential of the deposit. Likewise the increase in DSO resources is good news; however, we note that a majority of this increase has come from lowering the cut off grade, particularly at Pardoo. As drilling continues, we expect these resources and reserves to continue to increase, with more updates due before the end of the year. These positive announcements come on the back of news that the development of Pardoo has been delayed by approximately two months due to an appeal to the Environmental Protection Authority. We will be looking for the finalisation of this appeal by the Appeals Convenor within the next month, which should pave the way for ministerial approval. We also expect the signing of an agreement with Fortescue Metals Limited (“FMG”) that will allow Atlas to use FMG’s berth for exporting Pardoo DSO during the first year of operation. Other news in the coming months includes further upgrades to the Ridley resource, the completion of the Ridley PFS and partner selection, as well as further DSO upgrades and the commencement of mining at Pardoo. We continue to rate Atlas Iron Limited as a Speculative Buy.
AGO Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held