Basically half the company is ours as UNV is a chess depository 1:1. (Original calcs already took this into account, just didnt show the workings)
Have the 6 months report open now so will use more exact numbers and see if we can establish a valuation for the company moving forward to 2020 and 2021.
Shares Outstanding 522 Million
Based on the July to Dec 18 Operations Numbers as follows:
Just noticed as well, they virtually didint pay any tax this 6 months due to deductions as per note 18.
July to Dec 2018
2.97 mt sold for rev of 200,744,000 = 67.6 Aud/tonne
NPAT for period = 66,999,000
Less Gain on Bargin Purchase = 26,244,000
Net Profit from Operations = 40,755,000
Plus Add tax back = 1,441,000
Net Operating Profit = 42,196,000
CZA Tax Rate 28%
NPAT Actual = 30,381,120
Finished Cost Per Tonne = (200,744,000 - 30,381,120) / 2.97mt = 57.3 Aud/tonne
So assuming they meet there targets which are
- 2019 = 6mta
- 2020 = 8mta
- 2021 = 10mta
And they keep the same cost structure ( I realise there will be some cost savings as production ramps up, but the majority of costs with coal production are variable not fixed, so I think this is a conservative estimate) then
2019 - 6 mta, operating profit 60.8mil, UNV Australia Profit = 30.4mill. EPS = 30.4mil/522mil shares = 5.8 cents2020 - 8 mta,operating profit 81.1mil, UNV Australia Profit = 40.5mill. EPS = 40.5mil/522mil shares = 7.7 cents2021 - 10 mta, operating profit 67mil, UNV Australia Profit = 101.3mill. EPS = 50.6mil/522mil shares = 9.7 centsBased on the EPS estimates and looking at other peers in the Market predict UNV share price to be in the following range given that PE will fluctuate between 6 and 10. Doubt we will see higher then 10 because of the geographical location.
2019, PE Ave of 6 to 11, price = 35 to 58 cents2020, PE Ave of 6 to 11, price = 46 to 77 cents2021, PE Ave of 6 to 11, price = 58 to 97 centsSome observations
- An additional 1.2 Million tonnes from UBUNTA should come online subject to the coal supply agreement, ~6 to 12 months away
- No real detail provided on qty of coal to be added from ELOFF and PAARDEPLAATS projects part of NBC
I'm going to hold as I believe the current value is somewhere between 40 and 45 cents. If they unlock the additional tonnage from UBUNTA and reach 8mta by 2020 (Only 14 months away) then we should see a price close to 60 to 65 cents.
Coking Coal Project - Should be Fast Tracked
Just a note to all, the real value with UNV is unlocking the coking coal project which seems like they will need a partner based on current financial situation. I know the dividends are great however I would prefer that UNV holds all dividends and builds cash equity to self fund the Berenice and Cygnus project. There is over 1 billion tonnes in place. Sales per tonne fluctuates for coking coal between 100 and 250 dollars (USD).
Assuming mining costs are similar to thermal coal production.
A mine with 5 mta
Sale Price of 150 aud/tonne
Cost Price of 57 aud/tonne
Revenue = 750million
Costs = 285million
Profit = 465Million
UNV 50% = 232Million
EPS = 232/522 = 45 cents per share
Would give us a share price of $3.2 to $4 per share (USD). Convert to aussie do the maths.
If management can get a plan together and have sufficient equity UNV could be a serious game changer for all of us within 4 to 6 years.
