I have been buying CII mainly for 3 reasons;
– They are a Phosphate Producer.
– They are actively looking for further Phosphate opportunties.
– They have a 38% interest in Phosphate Resources who produce 700,000tpa. Last half they had revenue of $37M, resulting in a nett profit of $2.9M.
My rough workings for this year are:
700,000t P2O5 * $350t = $245,000,000
Costs $36M*2*15% = $ 83,,000,000
Tax @ 40% $ 72,000,000
NETT $ 90,000,000 *38% = $34,000,000 for CII
Now with 73M shares that equates to 46.5 eps.
Please note this is very rough and I would be happy to have input as I keep shaking my head thinking I have done something wrong. I also allowed an extra 15% in the costs over last years.
I have emailed the company to try and find out if sales are at a contracted price or spot, but I have not had a reply yet.
Also the mine life is 5-7 years and it looks like this will not be extended, but they are appealing it.
It is tightly held with the top 20 holding 84% at Dec 2007.
I am interested to hear other comments as this ones seems to have fallen under the radar to some extent.