ARH 0.00% 0.5¢ australasian resources limited

the king report

  1. 148 Posts.
    Read it and weep folks this is from ARH"s own web page telling us that at much cheaper prices for Iron Ore the company was worth $5.47 and thats with US $ AUD rate of .78c and as the company said in its asx release this does not take into account all of its other prospects.Gotta make ya feel good EH???

    Dividends are A$ 100 million (US$ 78m) after allowing for loan repayments in first year of full operation and cumulative dividends for the first ten years of full operation are A$ 2257 million(US$ 1761m).
    At a discount rate of 8% the NPV after tax in Year 1 for Australasian Resources’ share of the project is A$ 2683 million (US$ 2093m). If the NPV after tax is calculated at Year 5, this increases to A$ 3541 million (US$ 2762m).
    It is assumed that Australasian Resources will have on issue 490 million shares following full project funding on a fully diluted basis. In principle the value of a share is the discounted value (NPV) of the future stream of dividends that it will earn. On this basis the value of the share would be A$ 5.47 (US$ 4.27) per share at the start of the project, rising to A$ 8.71 (US$ 6.80) per share in Year 10.
    An alternative valuation of shares is to consider the price/earnings ratio for companies of the same type and to multiply that ratio by the earnings of the company after tax. Leading financial analysts were expecting a price-earnings ratio for major mining companies of 12.0 over the period to 20084. Using that method of valuation, and recognising that the value of ARH’s shares is effectively 50% of the value of the joint venture’s net profits after tax, the table shows that the share price in Year 10 would be A$ 7.03 (US$ 5.48) per share.
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