Stocks’ Details

Woodside Petroleum Limited

Decent First Half Year Performance: Woodside Petroleum Limited (ASX: WPL) is a large-cap company with the market capitalization of circa $34.34 Bn as of August 23, 2018. Recently, the group delivered the first half-year 2018 performance in which sales revenue increased by 27 per cent and amounted to $2,251 Mn in 1HFY18 as compared to the prior corresponding period. It was mainly driven by the high volume and value growth during the period. Resultantly, NPAT grew by 11 per cent to $541 Mn in 1HFY18 from the prior corresponding period which was at $511 Mn. Based on the decent performance, the Board of Directors declared fully franked interim dividend of US 53 cents per share for its shareholders and it will be payable on September 20, 2018 with the record date of August 24, 2018. According to the report, the group expects investment expenditure to be in the range of $2,000 million to $2,050 million for the full year, which includes the acquisition of an increased interest in Scarborough in the first half. Moreover, the production costs per barrel of oil equivalent across all operating assets for 2018 are expected to be between $5.50 and $5.80.


1HFY18 Financial Highlights (Source: Company Reports)

Meanwhile, WPL stock has risen 28.93% in the past six months as on August 22, 2018 and currently trades near its 52-week high. Based on the foregoing, we maintain our “Hold” recommendation on the stock at the current price of $ 35.810, considering robust financials with low gearing and strong liquidity position.
 

Ramelius Resources Limited

Update on Mt Magnet Resource & Reserve: Ramelius Resources Limited (ASX: RMS) reported new drill results from Eridanus at Mt Magnet in July’18 and a maiden resource a week later in August. Assays from infill RC drilling include 37m at 2.5 g/t from 23m and 20m at 22.0g/t from 74m. The company anticipated indicated resources of 123kozs (2.8Mt at 1.3 g/t) at Eridanus. Further, the extension drilling is continuing with the goal of a reserve estimate by December 2018. Additionally, for FY 19, annual group gold production is expected to be between 200-220,000 ounces at an AISC of A$1,150-A$1,250/oz. Moreover, the group estimates a maiden reserve for the planned Hill 60 and Shannon underground developments at Mt Magnet came in at 24kozs and 54kozs, respectively.


Ore Reserve (Source: Company Reports)

Meanwhile, the stock has fallen 18.64% in the past three months as on August 22, 2018 and is trading at a reasonable P/E level of 13.83x among its peer group. By looking at its June Quarter activity report and presumption to maintain ability to deliver gold production at or above its guidance, we give a “Speculative Buy” recommendation on the stock at the current price of $ 0.490.
 

Evolution Mining Limited

Looks at higher levels: Evolution Mining Limited (ASX: EVN) delivered annual group gold production of 801,187 ounces at an All-in Sustaining Cost (AISC) of A$1,645/oz against the production of 844,124 ounces at an AISC of A$ 1,641/oz in FY17. Resultantly, revenue increased by 4 per cent and amounted to $1,540.4 Mn in FY18 from the sale of 798,101 ounces of gold at an average realized price of A$1,564/oz compared to the previous year. It was largely due to a full 12-month sales contribution from Ernest Henry totalling A$347.4 million and was partly offset by the impact of the disposal of the Edna May Operation during the same period. EBITDA stood at $795.08 Mn in FY18 against the prior year, exhibiting 11.4 per cent growth on Y-o-Y basis. EBITDA margin expanded by 337 bps and recorded 51.6% in FY18 against 48.2% in FY17. Based on topline growth, the group recorded NPAT growth of 21% in FY18 on a Y-o-Y basis. Additionally, for FY 19, annual group gold production is expected to be between 720,000 – 770,000 ounces at an AISC of A$850 – A$900 per ounce.


FY18 Key Financials (Source: Company Reports)

Meanwhile, the stock has fallen 12.06 per cent in the past three months as at August 22, 2018 and is trading mid of 52-week level with a market capitalization of circa $4.7 Bn. As of now, we maintain our “Expensive” recommendation on the stock at the current market price of $ 2.750.


Comparative Price Movement Chart (Source: Thomson Reuters)

 
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