CEY - Centennial Coal

[Julia]

The new issue announcement today is having a negative effect on SP it seems.
Does anyone know the reason for this new issue?

 

[dj_420]

The new issue announcement today is having a negative effect on SP it seems.
Does anyone know the reason for this new issue?

Its the dividend reinvestment program, I have elected to recieve my dividends that way, extra shares without brokerage costs or taxes (until you sell).

 

[michael_selway]

Yeah I am still on board, didnt really have a chance to sell before a massive slump. I am on board at a good price so Ill stick it out.

The sell down in coal stocks has been overdone IMO, especially good ones already in production.

Anyone else still holding?

Yep I, others ones liek NHC & AQA could be a good to look at soon

Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS 6.5 17.1 58.3 76.0
DPS 4.9 10.0 20.0 28.0

thx

MS

 

[Julia]

DJ, does the issue of shares to cater for the DRP usually have this sort of negative effect on the SP? CEY is just not looking good.
Anyone else have any knowledge of why FLX, e.g. has still been rising, but CEY is wallowing?

 

[noirua]

CEY have reduced debts over the past year from $271 million to $149 million and the recent share issue will help reduce this further and push on on further developments.
The company had to sell their Anvil Hill interest to Xstrata due to heavy debt pressures and there appears no way the Directors will put themselves in this position again.
Annual coal sales reached 15.4 million tonnes and this is a good level of production.
Looking good value, imho, and I added just a few yesterday.

 

[singlefished]

Ouch! Only a few short weeks ago we were sitting pretty up over the $6 mark, and today we saw it drop below $4.

Still sitting above my buy in though but after watching the >80% "paper" gain drop back to <15% it is a bit demoralising

Anybody have any good news? or is no news good news? There's not been any company announcements for a few weeks so I'm assuming it's sentimental reaction to (or the crushing reality of) this commodities downturn we're all experiencing.

Or was the build up to a >$6 tag just temporary parking for the many $$$$ that were pulled from other areas of the market over the last few (many) months?

Cheers,
Scotty....

 

[dj_420]

CEY is looking very well placed in comparison to other producers, 20 mt ROM for the last year to date, compared to MCC who had close to 4 mt ROM and the MCC market cap is 2.7 billion compared to CEY 2 billion.

Great results today anyway, nice dividend, anyone else still holding?

 

[noirua]

CEY is looking very well placed in comparison to other producers, 20 mt ROM for the last year to date, compared to MCC who had close to 4 mt ROM and the MCC market cap is 2.7 billion compared to CEY 2 billion.

Great results today anyway, nice dividend, anyone else still holding?

CEY seems to still be suffering from the hangover of the previous weight of debt and lack of confidence brought about after selling Anvil Hill, which has a new name now. Companies, such as Felix Resources, will not reach the production of Centennial until at least 2012.

ROM production can be misleading, however, as it is a mix of rocks and other matter. So, the cleaner the coal is made, at the mine, the better. Far less waste in transporting and the coal sells for higher prices. Still a lot more for CEY to do in improvements here, that will eventually boost profits still further.

 

[noirua]

Everything set fair for booming Centennial: http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aRcAzcvoGD08

 

[dj_420]

CEY starting to look very good in comparison to MCC, CEY had profit of $68 million with PE of 7.48 whilst in comparison to MCC who posted profit of $72 million but currently on PE of around 51, these PE ratio just going by Comsec latest figures.

Certainly makes CEY look very good in driving seat for coal mining company considered to be small to mid cap.

 

[michael_selway]

CEY starting to look very good in comparison to MCC, CEY had profit of $68 million with PE of 7.48 whilst in comparison to MCC who posted profit of $72 million but currently on PE of around 51, these PE ratio just going by Comsec latest figures.

Certainly makes CEY look very good in driving seat for coal mining company considered to be small to mid cap.

yeak still looks good

Earnings and Dividends Forecast (cents per share)
2008 2009 2010 2011
EPS 79.5 65.8 86.1 93.1
DPS 21.0 32.9 41.0 47.0

thx

MS

 

[noirua]

A very good performance by CEY to wipe their face at $5.00. Very strong put through and should be a very interesting hold from here.

 

[michael_selway]

A very good performance by CEY to wipe their face at $5.00. Very strong put through and should be a very interesting hold from here.

Hi yep CEY is doing well

CEY- Earnings and Dividends Forecast (cents per share)
2008 2009 2010 2011
EPS 79.5 65.8 86.2 94.0
DPS 21.0 33.3 47.8 47.0

ERA - Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS 41.7 48.6 90.2 170.5
DPS 20.0 21.3 64.0 91.5


Thx MS

http://www.theaustralian.news.com.au/story/0,25197,24362479-5005200,00.html

Resources are no safe haven, says JPMorgan

INVESTORS looking to shelter from crumbling stock markets through mining shares should buy uranium miner Energy Resources of Australia or Centennial Coal, according to JPMorgan analysts, who advise under-weighting the sector as a whole.

In a report yesterday, JPMorgan said industrial companies looked a better bet than resources, largely because of falling oil prices, indications China's growth might slow and forecasts that interest rates would fall.

"The resources sector is no longer the safe haven it was from the middle of 2007 until halfway through 2008," JPMorgan analyst Paul Brunker said.

JPMorgan ranked Rio Tinto subsidiary ERA, which it rates "neutral", as the least risky buy of nine miners it covers, followed by Centennial.

"ERA's earnings are derived from long-term contracts which in the coming years should benefit as legacy contracts roll off and are replaced by higher-priced contracts," JPMorgan analyst David George said.

Andrew Forrest's Fortescue Metals Group, which would need to raise money for its expansions, was the most risky, followed by Alumina.

Fortescue's expansion to 160 million tonnes of iron ore a year, from its current ramp up to 55 million, could cost north of $7 billion, JPMorgan estimates.

A Fortescue spokesman yesterday said while the cost forecast was not unreasonable, the company intended to fund a "large portion" of it from cash flow, rather than rasing money through equity or debt.

JPMorgan is advising Rio in its defence of BHP Billiton's $US140 billion bid and did not include either miner in its analysis.

But it did suggest Rio was not the best safe haven buy.

"A safe haven ranking system would dictate a company with high debt and gearing, reliant on asset sales to reduce financial leverage, in an environment of falling commodity prices prices would be ranked low on the safe haven list," Mr George said after pointing out he could not rank the big miners.

Rio Tinto currently has about $US42 billion of debt after its $US38 billion Alcan acquisition and is trying to complete an extra $US7 billion of acquisitions this year.

Perhaps reflecting these worries, along with general uncertainties of the deal going ahead, Rio shares were hit harder than BHP's yesterday, falling 4.5 per cent to $102, while the predator's stock ended down 2.1 per cent at $35.65.

The drop means Rio shares are now 2.86 times the value of BHP's, the lowest they have been since a sweetened 3.4-for-one bid was lobbed in February. It also leaves the bid at a 19 per cent premium to Rio's current price.

JPMorgan said the strategy of moving bulk commodity prices to an index system also reduced earnings certainty.

BHP has been pushing for index-based pricing of its iron ore contracts.

Centennial Coal was the second least risky miner, with a lot of domestic contracts meaning it is not hurt by port constraints.

ERA shares ended down 5 per cent, while Centennial finished 3.4 per cent higher. Fortescue lost 6.6 per cent and Alumina finished 8.5 per cent lower.

 

[noirua]

Hi yep CEY is doing well

Earnings and Dividends Forecast (cents per share)
2008 2009 2010 2011
EPS 79.5 65.8 86.2 94.0
DPS 21.0 33.3 47.8 47.0

Thx MS

Interesting article, cheers. Maybe I should have bought more CEY and not MCC. There we goes. Somehow I think, imho, all coal stocks and mining stocks in Aus are dirt cheap at the moment.

 

[noirua]

Sorry to make similar posts on coal stocks, but as soon as CEY reached $3.00 it was time to forget the financial turmoil and add a few more. The yield nearing 7% and should hold Centennial up as people notice and see, the coal sector is mostly damaged at the steel making end.
Fair enough, Europe is expecting a downturn in car sales of around 20% and this needs to be factored into future coking coal prices. CEY has mostly thermal coal though.

 

[noirua]

The view of the analysts on Centennial Coal Ltd.,
http://markets.ft.com/tearsheets/analysis.asp?s=AU:CEY

 

[noirua]

Suncorp Medway increased their holding in Centennial Coal from 5.0669% to 6.0862%. Therefore I've added just a few at this low price hoping we're near the bottom now. PE ratio and earnings yield are looking favourable for those of us who keep the faith that profits and dividends will drop less than the market seems to think.

 

[noirua]

A bit of a puzzle are the second quarter results from Centennial and profits are difficult to work out. Will have to wait until next month.
Coal sales are down between 8% and 12%. Sale of 82% of Tahmoor boosted results last year and without that boost this year, the dividend being retained at present levels must be in doubt.

 

[mitch87]

noirua i see you have made posts on a couple of coal stocks, which one do you think is the best and do you currently hold any of them if you dont mind me asking, cheers.

 

[michael_selway]

A bit of a puzzle are the second quarter results from Centennial and profits are difficult to work out. Will have to wait until next month.
Coal sales are down between 8% and 12%. Sale of 82% of Tahmoor boosted results last year and without that boost this year, the dividend being retained at present levels must be in doubt.

Hey CEY did pretty well today

Earnings and Dividends Forecast (cents per share)
2008 2009 2010 2011
EPS 16.5 47.9 40.2 60.1
DPS 21.0 24.6 21.0 29.0

Date: 28/1/2009
Author: Jamie Freed
Source: The Sydney Morning Herald --- Page: 21
The discrepancy in the demand and prices paid for coking as opposed to thermalcoal is widening, and has ramifications for Australian-listed groups MacarthurCoal and Centennial Coal. The latter produces the thermal coal for power plantsthat has not experienced the same weakening in demand as the coking coalrequired by the troubled steel sector. As a consequence, Centennial'soutput is up and that of Macarthur down. On 27 January 2009 the respectivestocks closed $A0.01 higher at $A2.34 and $A0.05 lower at $A2.91

thx

MS