Resolute Mining Limited

RSG Details
· Rising gold prices drove the stock momentum: Resolute Mining Limited (ASX: RSG) stock surged over 3.2% on February 17, 2017 driven by the gold price movement. The group delivered a decent first half performance which achieved 170,558oz gold production during the year to date. The group shipped 164,826oz of total gold. All-In Sustaining Cost during the period was A$992/oz. For full year of FY17, the group expects a total gold production of 300,000oz with total gold shipped guidance of 325,000oz. On the other hand, the group expects a higher All-In Sustaining Cost of A$1,280/oz or US$934/oz. Some concerns do prevail around costs and gold prices. Further, RSG expects to have 20% lower mill feed grades at sulphide and oxide plant and this might result in gold production returning to normal guidance levels at Mali. Similarly, mine production from Mt Wright is also expected to be lower.

· Recommendation: We maintain our “Expensive” recommendation on the stock at the current price of – $ 1.78

Village Roadshow Ltd

VRL Details
· Weak first half results led the stock lower: Village Roadshow Ltd (ASX: VRL) stock fell over 5.6% on February 17, 2017 (post an initial fall of 13%). This came at the back of weak results from the group. VRL reported an attributable net loss of $6.7 million against $3.5 million of 1H16. Cinema Exhibition segment’s EBITDA fell to $32.4 million during the period as compared to $37.6 million of the prior corresponding period (pcp). The group witnessed a slight loss in market share due to rising competition while Hobart was closed for refurbishment. Moreover, the segments also witnessed higher costs, due to newly opened sites which are building momentum.  Film distribution fell $10.8 million in 1H17 from $14.8 million in 1H16. Overall, the group’s PBT fell to $27.1 million during the period from $28.8 million in the pcp.  Dreamworld world tragedy impact persists as the attendance by the core local Queensland market fell significantly hurting even food and beverage, retail and other in-park revenue. Season Pass sales also declined due to the tragedy while the Wet’n’Wild Las Vegas closed for CY16 season in late September 2016 As a result, VRL expects a weak FY17 EBITDA against the prior corresponding year which is again subject to June 2017 VIP pre-sales performance.

· Recommendation: VRL stock fell over 46.2% in the last one year (as of February 17, 2017) placing the stock at reasonable levels. Given the group’s revamping efforts, investors can leverage the subdued levels of the stock. The group’s efforts to attract customers, major promotions, development of new products with the potential to generate revenue in the future and restructuring efforts are still expected to benefit VRL in the long term. Further, VRL now aims to reduce its unacceptable level of gearing, and accordingly, is taking up measures including not paying any interim dividend for FY17 and potential asset sales. We maintain our “Buy” recommendation on the stock at the current price of - $ 3.56

 
Long term vision for Cinema Exhibition (Source: Company Reports)

Disclaimer
 
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd currently hold positions in:  BHP, BKY, KCN, PDN, and RIO. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.