# RSP - Resource Pacific Holdings



## nizar (17 February 2006)

Has anybody done some research on this coal miner??

Some background:

Resource Pacific Limited holds title to a number of mining leases and sub-leases in the Hunter Valley region of New South Wales, predominantly beneath the mined-out Ravensworth and Ravensworth South open cut coal mines and the operating Narama open cut mine.

The company owns and operates the Newpac No.1 Colliery, which is the largest remaining semi-soft coking coal reserve in the region.

During 2004, the company is mining semi-soft coking coal from its North Western Block at Newpac, on a bord and pillar basis. The mine has commitments from several large Asian steel mills for the majority of its forecast coal output for the 2005 financial year.

The company aims to produce 4 million tonnes per annum (mtpa) of primarily export coking coal by 2007, from the development of a longwall mine based on the Expanded Case Mine Plan. If market conditions do not allow the company to implement the expanded case, it aims to implement its Base Case Mine Plan, which should allow the company to produce 2.4 mtpa by 2006.

In the period to 30 June 2005, the company plans to complete its evaluation of the most appropriate method of developing the Southern Block at Newpac.

On 13 August 2004, the company entered into an agreement with subsidiaries of BHP Billiton to purchase their 53.4% interest in the Ravensworth Coal Terminal Joint Venture.

Only 1 broker covering:

SB citigroup have initiated coverage with a Buy, High risk recommendation, with a price target of $1.82

Last trade was $1.18

OMG look at those forecasts!!!!

and dividends coming...

Earnings and Dividends Forecast (cents per share) 
Curr 2006 2007 2008 
EPS 1.5 1.4 16.5 39.3 
DPS --  0.0  0.0  8.4


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## michael_selway (18 February 2006)

nizar said:
			
		

> Has anybody done some research on this coal miner??
> 
> Some background:
> 
> ...




hehe yes, fwd 2008 PE of 1.19/0.393 = 3!

However its still developing i guess, 2005 amd 2006 negligle returns

Also Coal Prices, not sure what it wil be like in 2007/2008 when there production is at full cpacity. So atm u can say its speculative

Theres another very low foreward PE, FLX which also produces coal. But again both are "still developing"

----------------------------------

http://www.globalcoal.com/

 NEWC Index 
20-Jan-06 44.51 
27-Jan-06 46.18 
03-Feb-06 47.87 
10-Feb-06 50.02 
17-Feb-06 47.78

NEWC Index 
Oct-2005 40.89  
Nov-2005 37.32  
Dec-2005 39.16  
Jan-2006 43.73  

http://www.aireview.com/index.php?act=view&catid=8&id=3567

Citigroup Sees Return Of 57% From Resource Pacific

February 16 2006 - Australasian Investment Review

A whopping 57% expected total return is what analysts at Citigroup are flagging for Resource Pacific (RSP).

No surprise then that they have initiated coverage on the stock with a Buy, High Risk recommendation and a target of $1.82. 

The company owns and runs the Newpac colliery in the Hunter Valley, the analysts say, which currently produces 0.9Mtpa as a border and pillar operation. 

Development of the longwall unit, which the analysts say is set for commissioning in Jan 2007, "will lift output to around 4.2Mtpa of semi-soft coking coal and export thermal coal."

The analyst say resources at the mine cruelty stand at 255Mt, with a reserve component of 73Mt, enough to sustain a mine life of 20 years. 

Citigroup is forecasting FY06 profit of around $4m, FY07 of $19m and FY08 of around $60m. 

The company is currently trading at a PE multiple of 7.6x FY07 earnings forecasts and 2.4x FY08, compared to Australian coal sector averages of 8.9x and 6.6x respectively.


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## haemitite (25 July 2006)

19th July - Citigroup revised target is 1.91 (RSP currently 1.18)

Broker report below

”  Production and sales were in-line with our expectations. Full year ROM production of 787kt was achieved after a June quarterly contribution of 209kt. Subsequent saleable coal production amounted to 562kt (June quarter 143kt) with full year sales of 615kt (June quarter 131kt). 
”  Sales could have been higher if coal loading had not been delayed at the port of Newcastle. At the end of June the company had 106kt of product available for shipment, which will now be deferred into July. 

”  Importantly, the tail gate development drive is due to be completed by the end of September and all longwall components are now in Australia ready for compatibility testing in August/September. This should allow for the underground installation of the longwall during the second quarter of FY07e. Initial production from the longwall is targeted for January and remains on track. 

”  Underground development continues to highlight favourable mining conditions and a 1,000m exploratory drillhole has confirmed the potential of the first longwall block. 

”  Earnings for FY06e have been downgraded from a $3m profit to a $2.3m loss due to the deferred coal shipment and increased production costs from the development drives. We have also downgraded FY07e and FY08e NPAT from $21.7m to $19.5m (-10%) and $61.2m to $54.8m (-10%) respectively. However, the massive upgrade to production and earnings from the longwall commissioning means the stock remains a Buy/High Risk (1H) with a target price of $1.91 (previously $2.16).


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## haemitite (12 September 2006)

Citigroup valuation up to $2.43. I hope that longwall installation proceeds smoothly..... 

”  Resource Pacific reported a full year FY06a loss of $3.18m, marginally worse than our -$2.2m estimate (consensus -$1m) and implying a June half loss of $3.23m.  

”  Revenue was better than forecast at $56m vs our $48m estimate, however, costs were higher due to emphasis on development (higher cost product) and higher costs of sales attributable to spot coal purchases made to meet lost production over the Christmas period. 

”  Gearing stands at 25% (nd/eq) but with cash of ~$54m the company should comfortably complete the longwall installation with first production in January'07. 

”  A new contract for 1.75mt of coal over five years has been signed with Bhushan Steel & Strips and port allocation for the first two years longwall production has been obtained through PWCS. 

”  RSP remains an FY07 story. Longwall development and refurbishment of the coal prep plant are on schedule. We forecast production to increase from 787kt in FY06a to 3.77mt in FY08e. 

”  FY07e and FY08e earnings improved ~3% and ~5% respectively after inclusion of the FY06a results. Of greater significance was the increase in NPV to $2.70 (previously $2.10) after the forecast period was rolled forward ”  Our Buy (1H) recommendation has been retained but with an improved target price of $2.43 (previously $1.91).


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## stockpile (13 February 2007)

Will feature in tomorrow's media coverage, MD comments that they have created a good platform for growth and should meet its production targets after completing the expansion at its Hunter Valley mine.


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## michael_selway (13 February 2007)

stockpile said:
			
		

> Will feature in tomorrow's media coverage, MD comments that they have created a good platform for growth and should meet its production targets after completing the expansion at its Hunter Valley mine.





Hi not bad

*Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS -2.4 1.5 21.8 21.9 
DPS 0.0 0.0 5.5 5.5 * 
thx

MS


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## haemitite (29 March 2007)

Back to no 1 on Citigroups recommendations, 2.12 target in their latest top 20 report (curently 1.36).

No associated detailed research.


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## michael_selway (15 September 2007)

haemitite said:


> Back to no 1 on Citigroups recommendations, 2.12 target in their latest top 20 report (curently 1.36).
> 
> No associated detailed research.




They keep changing their forecasts

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 2.7 17.8 29.0 32.7 
DPS 0.0 0.0 10.4 11.0 

EPS(c) PE Growth 
Year Ending 30-06-08 17.8 9.7 566.7% 
Year Ending 30-06-09 29.0 6.0 62.9% *

I wonder if RSP has a limited mine life?

thx

MS


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## Go Nuke (26 September 2007)

oooh a takeover offer!

Looks like  I bought and sold at just the right time

Any thoughts on this?


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## rhen (27 September 2007)

Today's Money Morning quote:
_In other resource news, Coal miner New Hope is making a AU$591 million bid for Resource Pacific. The hostile offer sent Resource Pacific shares up 28%. Expect another offer from a third party._
and read
http://www.bloomberg.com/apps/news?pid=20601081&sid=aq6DlogzDITw&refer=australia
I own shares in RSP


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## Go Nuke (27 September 2007)

rhen said:


> Today's Money Morning quote:
> _In other resource news, Coal miner New Hope is making a AU$591 million bid for Resource Pacific. The hostile offer sent Resource Pacific shares up 28%. Expect another offer from a third party._
> and read
> http://www.bloomberg.com/apps/news?pid=20601081&sid=aq6DlogzDITw&refer=australia
> I own shares in RSP




I did own shares.
Bought on Friday and sold at 2.43 on Monday

I actually had a sell at the old resistance of $2.20 but someone wanted to pay more hence the gap up.

It was fine with me


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## rhen (28 September 2007)

Congrats GN. Anyone taking a profit deserves congrats, but I'm hoping a new party does come into play...and that more profits come available.
We recently observed CSM and its share price activity, as just one example.
Citigroup's recent report (13/9) notes a valuation of $2.41 and "with large reserves and the potential for significant production upgrades in the future, ...possibility to be targeted by a larger coal player..."
Anyone interested could do well to read this report:
http://www.resourcepacific.com.au/investors/research-reports
Whether or not RSP attracts further interest, the company has the fundamentals to provide positive outcomes, but it's not an investment for the risk averse
rhen


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## michael_selway (29 October 2007)

rhen said:


> Congrats GN. Anyone taking a profit deserves congrats, but I'm hoping a new party does come into play...and that more profits come available.
> We recently observed CSM and its share price activity, as just one example.
> Citigroup's recent report (13/9) notes a valuation of $2.41 and "with large reserves and the potential for significant production upgrades in the future, ...possibility to be targeted by a larger coal player..."
> Anyone interested could do well to read this report:
> ...




Hi ir doesn look pretty fully valued at around $2.50 it is on now

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 2.7 15.4 22.5 22.7 
DPS 0.0 0.0 10.4 11.0 *

thx

MS



> Date: 22/10/2007
> Author: Jamie Freed
> Source: The Sydney Morning Herald --- Page: 27
> Australian mining company New Hope has applied to the Takeovers Panel to delay avote by Resource Pacific shareholders. New Hope is hoping to acquire theQueensland group, however Resource is currently finalising plans to launch arights issue, which would help it resist the New Hope offer. New Hope believesshareholders should be given accurate information that would allow them tocompare the benefits of the takeover with the consequences of the rights issue.Rival bidders are expected to emerge for Resource Pacific


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## michael_selway (4 December 2007)

Go Nuke said:


> I did own shares.
> Bought on Friday and sold at 2.43 on Monday
> 
> I actually had a sell at the old resistance of $2.20 but someone wanted to pay more hence the gap up.
> ...




Hm its goen crazy again

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 2.7 13.0 25.2 26.0 
DPS 0.0 0.0 7.9 10.6 *




> 4 December 2007
> Dear Shareholder,
> You will be receiving New Hope Corporation's bidder's statement. Your board is currently
> evaluating the bid in detail and we will send you shortly our formal recommendation with our
> ...


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## rhen (8 December 2007)

rhen said:


> Congrats GN. Anyone taking a profit deserves congrats, but I'm hoping a new party does come into play...and that more profits come available.
> We recently observed CSM and its share price activity, as just one example.
> Citigroup's recent report (13/9) notes a valuation of $2.41 and "with large reserves and the potential for significant production upgrades in the future, ...possibility to be targeted by a larger coal player..."
> Anyone interested could do well to read this report:
> ...




The odds are reasonably good that the activity from the burley in the water will attract bigger fish now. Only time will tell. 
This is a positive:
http://www.resourceinvestor.com/pebble.asp?relid=38539
Xstrata has been outbid before and I, personally, hope an aussie comes to the rescue again.
rhen


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