Emerging Companies: Altona Mining Ltd (AOH)

|

Published 20-FEB-2014 00:00 A.M.

|

2 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.


Click Here to View Latest Articles

Overview: Altona Mining Limited ("AOH", the Company") is an Australian minerals Company focused on copper. Its most advanced asset is the Outokumpu Project in SE Finland, which hosts a polymetallic ore reserve of 4.2MTand a 0.7MTpa processing plant. Altona commenced metal production at Outokumpu in 2012. At an earlier stage of development is the Company’s Roseby Copper Project near Mt Isa in Queensland, Australia. A Bankable Feasibility Study completed in May 2012 delineated copper-gold reserves of 53MT.

Catalysts: Altona generated its maiden profit in FY13 as Outokumpu became operational. With borrowings cut in half to US$10 m during the last quarter, and management upgrading production guidance, the Company’s transition to a ‘self-funding’ status is expected to drive interest. Securing mine life extensions at Outokumpu and a development partner for Roseby are major value catalysts. The Kylylahti orebody at Outokumpu remains open at depth, with recent extension drilling returning its best-ever intercept, 108 metres at 2.4% copper and 1g/t gold. At Roseby, discussions have commenced with China-based development partners.

Hurdles: Roseby’s commercial potential became uncertain following Xstrata’s withdrawal from a development partnership in 2013. Cash flow remains subject to metal price fluctuations and there is no guarantee that deeper extensions of the Kylylahti orebody will be economically minable.

Investment View: Altona has a balanced portfolio of development and production assets with leverage to copper prices in low-risk jurisdictions. We are attracted to the Company’s operational record in Finland, strengthening its financial position, and strategic positioning of the Roseby Project. Subsequent to Xstrata’s withdrawal, Chinese investment in the Mt Isa region has increased significantly, including $1billion in construction funding for the adjacent Dugald River Project. Expecting a new partner to drive growth, we commence coverage with a ‘buy’ recommendation.



General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.

 

Discover Undervalued
Stocks with Wise-Owl

Join thousands of other Investors following our stock commentary for Free

X