Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: pezz who wrote (14791)	2/10/2002 8:09:50 PM
From: Moominoid	Read Replies (2) \| Respond to of 74559

YTD is the last 12 months or Jan+Feb?! Everyone - check Lihir Gold (LHG.AX) cres.anu.edu.au Price moves very closely with the gold price. Here is the Investor Web Report - so this could be a good short if one thinks the gold price is going down. But I wouldn't invest in a PNG goldminer like this! Market Review: LHG has posted a strong performance over the past quarter, recording a 41.4% price movement for the period, against the All Resources Index return of 23.0%. Within LHG's industry grouping, Gold, the performance was worse, with the industry sector recording a better 43.1% return. As a matter of interest, Climax Mining Ltd was the best performer within the sector over the last quarter, recording a 131.4% price rise in share price terms. Financial Results: LHG's last recorded result, for the half year period to 30 June, was an adjusted Net Profit After Tax of $21.0m. This was up 127.1% on last year's result, with $9.2m earned for 1H00. Important aspects of the result included an 11.1% increase in sales to $116.8m, a 42.1% decrease to $1.1m in other revenues, a 120.4% decrease in net interest costs to an income of $1.1m, a 5.3% increase in depreciation and amortisation cost of $17.1m. Other important points included a fall in the EBLITDA margin, at 31.6% against last year's 34.4%. Total assets fell 36.7% to $581.8m, with net debt to equity of 2.2% against the previous corresponding period's 14.0%. Free cash-flow was stronger at $38.1m against $30.6m in 1H00. View Point: Papua New Guinean gold miner Lihir Gold recently announced that it had lifted interim net profit by 1.9% to $US21 million in the six months to June 30 2001, on the back of revenue that rose by 9.1% to $US116.81 million. InvestorWeb believe that a pick-up in the price of gold and the continued slowdown in the global economy will also have beneficial effect for Lihir going forward. The world's largest gold miner, Anglo Gold, has publicly said that it believes the gold price will head north in the future because it considers it is no longer profitable for producers to hedge because of higher lease rates: once producers stop hedging, the gold price will go up. InvestorWeb maintains a hold recommendation on LHG at current levels due to its recent strong uptrend and our belief that it is fully priced at current levels. ------------------------------------------------------------------------ Key Points: * Relatively Low Return on Equity at -25.9% * Relatively Poor Return on Assets at -17.3% * Expensive on Relative Forecast PER Multiples * Relatively Expensive when measured by Price to Net Assets * Relatively Poor Interest Cover * Expensive with a Relatively Poor Cash Flow Ratio Activities: The company is primarily involved in the development and production of one of the world's largest gold deposits in Papua New Guinea.