Independence Group NL

IGO Details

During Q3FY17, Independence Group NL (ASX: IGO) reported revenue decline of 35% qoq at $83.9 million, impacted by lower less zinc concentrate shipments and no copper concentrate shipment from Jaguar. However, Tropicana gold sales were in line with expectations and Long continued to deliver by maintaining strong sales volume. NPAT increased to $12.3 million, led by $4.4 million before tax mark-to-market investment revaluation gains, and the non-recurrence of a A$3.9 million acquisition stamp duty tax expense in the December 2016 quarter. Further, cash flows from operating activities increased by $6.0 million to A$23.4 million, primarily due to the non-recurrence of the prior quarter’s stamp duty taxes paid; $52.5 million assessment for the Sirius Resources NL’s Nova acquisition, and a A$5.7 million payment in relation to the completed duties assessment for the 2011 acquisition of Jabiru Metals Limited’s Jaguar Operation. IGO continued to fund the Nova Project build and ramp up from existing cash reserves and cash flow from operations, with $35.6 million spent during the Quarter. As a result, there were no further debt draw-downs during the Quarter and drawn term debt remains at $200 million.

Over the past one month, the stock has moved up by 21%29.30% (as on June 08, 2017) and still seems to be on the strong momentum. We give a “Buy” recommendation on the stock at the current price of $ 3.39

Caltex Australia Limited

CTX Details

During May 2017, Caltex (ASX: CTX) has completed the acquisition of Milemaker Petroleum’s retail fuel business assets in Victoria for $95 million. The acquisition brings 46 Milemaker sites into the core Caltex network in Melbourne. Further, the company will invest in the network to deliver an enhanced fuel and convenience offer to customers across Melbourne. Importantly, Milemaker has a competitive pricing strategy and allows motorists to avail cheaper fuel.
 
On refinery margins front, the April unlagged CRM stood at US$15.74/bbl, above the prior month (March 2017: US$11.26/bbl) and prior year monthly comparative (US$8.80/bbl). The unlagged Caltex Singapore Weighted Average Margin was US$13.64/bbl, which is above the prior month (March 2017: US$12.04/bbl) and the prior year (April 2016: US$10.69/bbl). Importantly, higher petrol and diesel refiner margins in the last week of April drove an unfavorable US ($0.41)/bbl pricing lag (March favorable pricing lag: US$0.39/bbl). Further, the April 2017 realized CRM was at US$15.32/bbl including the pricing lag, above the March 2017 CRM of US$11.65/bbl and prior year comparative (March 2016: US$8.37/bbl). Sales from production in April 2017 of 525 ML were below the prior month (March 2017: 534 ML) and prior year comparative (March 2016: 554 ML). For the four months to 30 April 2017, the average realized CRM was US$13.05/bbl (2016 US$10.01/bbl), while CRM sales from production totaling 1,984 ML (2016: 1,997 ML).
 
Over the past three months, the stock has moved up by 16% (as on June 08, 2017) and currently trading at higher levels. We give a “Hold” recommendation on the stock at the current price of $ 32.17

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