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Allied Gold

May 2011

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • AGLD
  • Price:
  • 41p
Perhaps with one eye on the problems at its Simberi gold mine in Papua New Guinea, Allied has shored up its balance sheet by placing 156.3m new shares at 38.5p a share, raising gross proceeds of A$93.8m (£60.1m). Around A$50m will retire debt, while a further A$15m will fund the replacement of Simberi's diesel fuel electricity generation with heavy fuel oil to reduce power costs by 25%. The balance will fund Simberi's expansion as well as exploration and working capital needs. Encouragingly, production at Simberi has now re-commenced, while commissioning is progressing at its second mine in the Solomon Islands.Although the new shares have diluted eps forecasts to 1.9 cents for this year, rising to 9.8 cents (6.3p) for the year st ...

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