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mining co valuation methods

  1. probing

    2,572 posts.
    Would like to hear how mining sector "Copperites" value a company based on production data.

    Am interested in what range of "multiples" of pre or after tax profit would be considered as normal within the industry

    Eg.

    Mine life 5 years
    Treatment rate 1 mtpa
    Average LoM grade 1.93 g/t
    Gold contained 310,900 oz
    Gold recovered 289,200 oz
    Plant recovery 93%
    LoM gold price $584/oz (US$330/oz)
    LoM Exchange Rate US56.5c
    Direct cash costs $404/oz (exclusive of Perth office costs)
    Cost of production $24.4/t
    Capital cost $5.1m
    Working capital $3.7m (2 months of 1st year total operating
    costs)
    Total start-up capital $8.8m
    LoM revenue $169m
    LoM net cash flow $26.3m
    NPV @10% discount $14.5m (after tax)
    IRR 87% (after tax)
    Cum Cash Positive After 15 months (after tax), after 11 months
    (before tax)

    Abbreviations used above are defined as:

    LoM = Life of Mine
    IRR = Internal Rate of Return
    NPV = Net Present Value
    mtpa = Million Tonne per Annum
    Cum = Cumulative
    $ = Australian Dollar
    US$ = United States Dollar

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