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“W Resources making large strides” Northland Capital Partners

Northland Capital partners view on W Resources PLC LON:WRES: W Resources made large strides towards the development of the hard rock La Parrilla Tungsten project in 2015 and despite the large amount of work involved the LBT remained relatively low. 2016 will see the completion of the V2 feasibility study for the project and maiden hard rock production for the Company.

LBT remains level at £0.6m
n  LBT remained level at £0.6m in FY15 from FY16 but below our forecasts of £0.7m.

n  Net debt reduced to £0.3m in FY15 compared to £2.1m in FY14 and a significant improvement on our forecasts of £2.8m.

n  Forecasts updated, rating and price target maintained.

Year end Dec Revs (£m) Adj. EBITDA (£m) Adj. PBT (£m) Tax (%) Adj. EPS (p) PER (x) Div (p) Net cash (£m) Yield (%)
2014A  1.0 (0.5) (0.6) (0.0) NEG (2.1)
 2015A  0.1 (0.4) (0.6) (0.0) NEG (0.3)
2016E† (0.4) (0.6) (0.0) NEG (10.1)
2017E†† 11.5 0.7 0.7  0.0 NEG (15.4)

Source: Northland Capital Partners Limited. * Northland Capital Partners acts as Joint Broker † assumes a £10.9m debt finance package is secured, †† assumes a £4.1m debt finance package

 

Northland Capital partners view: W Resources made large strides towards the development of the hard rock La Parrilla Tungsten project in 2015 and despite the large amount of work involved the LBT remained relatively low. 2016 will see the completion of the V2 feasibility study for the project and maiden hard rock production for the Company.

Disclaimer: Statements in this article should not be considered investment advice, which is best sought directly from a qualified professional.