LHG

Lihir Reports a Stunning $109.3 Million Profit


Lihir Gold (LGL) has recorded $109.3 million profit for the year 2008. Analysts on average were expecting Lihir, whose main asset is the Lihir gold mine in Papua New Guinea, to report 2008 net profit of $122.13 million, based on Reuters Estimates, against a $24 million loss in 2007. Lihir Gold, the second largest gold mining company said second-half sales rose 64% to $468.9 million from $286.7 million, a year ago. Net profit rose 229.0% to $73.7 million compared to net profit of $22.4 million, a year ago.

AED Oil: Worst Performer for Week 22 of 2008


AED Oil was the overall worst performing stock taking in a 21.14 percent decrease. The technical price chart above is for AED and shows a 10, 100 MA on a candlestick chart, each candle representing 3 trading days. It was a mixture of mining and metal exploration, aviation and resources companies who were among the worst performing stocks for the week 22 of 2008 on the Australian sharemarket: Lihir Gold (LHG), Macquarie Airports (MAP), BHP Billiton (BHP), AED Oil (AED), Minara Resources (MRE), St. Barbara (SBM).

Felix Resources (FLX)


Felix Resources (FLX) was the overall best performing stock taking in a 18.86 percent increase. Among the best performing stocks for the week 21 of 2008 on the Australian sharemarket were a mixture of financial and communication services, energy, gold mining, coal mining, and oil: Computershare (CPU), Paladin Energy (PDN), Lihir Gold (LHG), Felix Resources (FLX), AED Oil (AED), Centennial Coal ( CEY). The best performing stocks for the week 21 managed gains above 8.06 percent by the end of the trading week.

Roc Oil: Worst Performer for Week 14 of 2008


Roc Oil was the overall worst performing stock taking in an 11.92 percent decrease. It was a mixture of property development, mining, financial services, and oil companies who were among the worst performing stocks for the week 14 of 2008 on the Australian sharemarket. Valad Property (VPG), Lihir Gold (LHG), Allco Finance (AFG), Roc Oil (ROC), Equinox Minerals (EQN). These worst performing stocks for the week 14 recorded losses above 6.12 percent by the end of the trading week.

Energy Resources of Australia (ERA) Worst Performing Shares for Week 13


Energy Resources of Australia (ERA) was the worst performer with a negative move of 18.2%. Among the worst performing stocks for the past trading week (week 13 for 2008) on the Australian sharemarket were a mixture of child care services, mining, energy and financial services: ABC Learning (ABS), Lihir Gold (LHG), Fortescue (FMG), Energy Resources Of Australia (ERA), Macquarie DDR Trust (MDT). These worst performing stocks for week 13 of 2008 were ranged from 13.8 percent to 18.2 percent in their losses.

Paladin Energy (PDN) Worst Performer


Paladin Energy (PDN) was the overall worst performing stock taking in 18.33 percent decrease. Among the worst performing stocks for the week 46 of 2007 of the Australian sharemarket were a mixture of energy, petroleum, mining and oil exploration: Paladin Energy (PDN), Woodside Petroleum (WPL), Lihir Gold (LHG), AED Oil (AED). These worst performing stocks for week 46 of 2007 recorded losses above 10.77 percent by the end of the trading week.

Sino Gold (SGX): Winner


Sino Gold (SGX) was the overall best performing stock taking in a 20.67 percent increase. Among the best performing companies for the past week (week 38 of 2007) on the Australian sharemarket were a mixture of oil & gas, metal and mining: Newcrest (NCM), Lihir Gold (LHG), Oil Search (OSH), Sino Gold (SGX), Sally Malay (SMY), Western Areas (WSA). All the above best performing stocks for week 38 managed more than 13.5 percent gain by the end of the trading week. The majority of companies in this list were mining companies.

Which Shares Outperform When The Australian Dollar Rises?


Shares analyst UBS have a look at which shares Outperform when the Australian dollar rises. The analyst: The obvious way to measure a share's currency sensitivity is to look at its EPS sensitivity. However, the shares analyst note that this ignores what else is going on when the Australian dollar (A$) is rising.

Lihir Gold Ltd (LHG) Update


Lihir Gold (LHG) have a maintained Hold rating from Citigroup Investment Research (CIR). Post completion of the LHG/BGF merger, the analyst is incorporating the Ballarat gold mine into their LHG model. Dilution from new stock issued meant that the transaction was NPV destructive; however, their Hold recommendation remains due to the potential for greater things from Lihir Island. NPAT for FY07E and FY08E has changed by -5% and +4%,respectively. Lihir Gold's risk profile has increased; The company previously trading at a discount to its peers due to its single PNG mine status, however, the resource/reserve uncertainty at Ballarat has actually increased the risk profile. The nature of the mineralisation at Ballarat makes production forecasts unreliable thus increasing the risks of LHG missing production guidance targets. Company guidance for Ballarat suggests that the mine will produce 100koz in CY08 ramping up to +200koz in CY09 and 250koz in CY10. CIR are forecasting 65koz, 180koz and 200koz respectively. It is worth remembering that production was supposed to have commenced a year ago. To put the blue sky into context, the project currently has 1.4Moz in resource, of which 1.2Moz are in the lowest confidence inferred category, and no reserves. The LHG acquisition is based on a mining plan that produces 4.8Moz over a 20-year mine life at cash costs below US$220/oz. The company now has several fronts to focus on. The first milestone is the commissioning of the flotation plant (due to commence in April). This will be followed by commercial production at Ballarat (early 2008). Whilst in the background, progress on the Lihir Island expansion to +1Mozpa will be measured against the time frame and costs given in January.

Lihir Gold (LHG) Share Update


Lihir Gold (LHG) has a Neutral 2 share recommendation and a $3.40 share price target according to a share update from analyst UBS. Their price target is based on a premium to NPV of 2.3x and they have a valuation of $1.46 for Lihir Gold. UBS as some commentary: "The upgrade to 23.6Moz reserves is largely due to an increase in gold price assumption from US$380/oz to US$475/oz and a reduction in cut-off grades. The revised estimate accounts for cost benefits expected from geothermal power, and the flotation project currently under construction, but does not account for proposed capacity expansions beyond 1Moz which should increase reserves further." As a result global multiples look attractive: "Although the upgrade is attributable to a change in assumptions, these do come into line with other gold stocks. Newcrest uses A$600/oz (US$420/oz @ 70c) and Oxiana used US$600/oz for Prominent Hill. A common comparable for gold stocks is market cap/reserve oz where the average is US$200/oz which on the old reserves 21Moz valued Lihir at $4.14 and at 23.6Moz reserves values Lihir at $4.65." Finally UBS sums up their share update: "We remain positive on the outlook for gold and expect an average of US$700/oz in 07. We also expect to hear more about the proposed capacity expansion to >1Moz and further reserve upgrades which this project should enable. Next news is the Q4 result and preliminary financials on 30 Jan and the scheme vote by BGF shareholders on Feb 12."

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