Centamin - cracking Interims. A review by Nigel Somerville...

Dream on Metro Bank. Read from Chris Bailey HERE

Fully-listed Egyptian gold-miner Centamin (CEY) - in which I own shares - has released its half-year results to the end of June and they look great. And the interim dividend has been hiked by 50% to 6 US cents per share (as predicted in these parts), with the cheque arriving on 11 September a couple of weeks earlier than last year. Yum-yum...

Gold smashes through $2000 – and still more to come says Nigel Somerville HERE

With the gold price having been very strong all year these were always going to be good numbers but cash costs and all-in costs are comfortably within guidance and gold production for the year remains on track for between 510,000-525,000 oz. The average gold price received during H1 came in at $1657 against which cash-costs of $642 and all-in costs of $899 meant that Centamin has been piling up the cash very nicely. With the yellow stuff now up to around $2000 things are looking good for the full year, even if the Egyptian state’s cut is rising to 50% from 45%.

Read HERE: Loungers – argues sales ‘encouragement’, but still early days...

In terms of cashflow, after profit-share and royalties the result was $102 million added to the coffers, out of which the hiked dividend costing $69 million will be met. And with gold now higher, it all looks great for another dividend hike at the full-year: 9 US cents anybody? That would suggest a dividend yield of an attractive over 5%.

The Investment Outfit that Dumped Ceres Cost Me a Packet (on Paper). But It Does Seem to be On the Ball says Malcolm Stacey HERE

Centamin’s balance sheet looks very strong: there is no debt, no hedging, net current assets sat at $412 million and with a post-tax and post royalty profit of $74.8 million that suggests a PE of over 20. But the kicker is that with the gold price now and not a cloud on the horizon as opposed to $1657 over the H1 period, margins over the all-in cost are now much higher. Roll on the FY results! The numbers have gone down well enough, setting sail into record high territory on the way towards my current target price of 250p.

Video HERE: WARNING Red-Hot Gold Stocks Will Cool Off in August

Filed under: Centamin, Metro Bank, gold, Loungers, Ceres, gold stocks, Nigel Somerville

2020-08-05 12:48:49

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