Comparing Yellow Cake with Yellow Cake

I like the uranium theme.

Today, Australian listed uranium mining explorer and producer, Paladin announced a $200 capital raise which is equivalent to 10% of its market cap.

In March 2021, the company raised $192 million.

Nothing like raising enough capital to equal something close to 25% of your market capitalisation within a 12 month period.

So I kept my analysis about the merit of the latest capital raising simple.

At a market capitalisation of A$2.15 billion and trading at 78 cents, Paladin is the same market cap as when the stock was $2.50 in 2011…..due to share issuance.

and then I look at their resources and reserves

and then I compared it to the national producer of Kazakhstan….who is considered an industry leader

Kazataprom (supplies 40% of the world’s uranium for contract nuclear power generation)

Market Cap A$10.2 billion equiv.

Revenue A$680 million equiv.

EBITDA $285 million equiv.

 Measured Mineral Resources of 700.9Mt grading 0.058%U and containing 406.6ktU, 

 Indicated Mineral Resources of 710.2Mt grading 0.052%U and containing 369.1ktU, 

 Inferred Mineral Resources of 13.6Mt grading 0.063%U and containing 8.6ktU. 

 Aggregated Mineral Resources of 1,424.7Mt grading 0.055%U

source: https://www.kazatomprom.kz/storage/71/uk31126_kap_2022_cpr_letter.pdf

Paladin

Market Cap A$2.1 billion

Revenue Nil

EBITDA Negative

 Measured Mineral Resources of 131Mt

 Indicated Mineral Resources of 77Mt

 Inferred Mineral Resources of 7.7Mt

 Aggregated Mineral Resources of 215.7Mt

Paladin grade data is fragmented, so I’ll assign a weighted average of 0.063%

source: https://www.paladinenergy.com.au/wp-content/uploads/2020/11/Mineral-Resources-Ore-Reserves-30-June-2020.pdf

March 31, 2022

by Rob Zdravevski

rob@karriasset.com.au