Q2-2010 Highlights
- In July 2010, we visited the MVC facility located 90 kilometerssouth of Santiago, Chile.
- Amerigo’s net revenues (revenues net of smelter and refinerycharges) increased from $29.66 million in Q1-2010, to $32.43million in Q2-2010, an increase of 9.4%. Revenues increased ascopper sales increased QOQ from 8.5 mm lbs, to 11.4 mm lbs(versus our estimate of 11.2 mm lbs), and as molybdenum salesincreased from 0.14 mm lbs, to 0.16 mm lbs (versus our estimateof 0.16 mm lbs).
- ARG’s cash costs (including royalties) dropped QOQ from$2.66, to $2.49 per lb, as a result of the increase in production.
- We have not made any material changes in our revenue and EPSestimates. Our net profit forecasts for 2010, and 2011, are $13.94million (EPS: $0.08), and $21.55 million (EPS: $0.13),respectively.
- ARG’s current forward P/E and P/S are just 8.4x, and 0.90x,versus the trailing Metals and Mining industry average multiplesof 20.5x, and 1.3x, respectively. Subsequent to Q2, ARG shares started trading on the Lima StockExchange.
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