“Meanwhile, we expect more capex from flotation facility construction and additional operating expenses from a planned dual primary listing in Hong Kong,” he adds.
CNMC reversed out of the red in the 4Q ended December with earnings of US$1.3 million ($1.7 million) on the back of a decline in management remuneration and employee benefits, compared to a loss of US$1.9 million in the corresponding quarter a year ago.
However, full-year earnings fell 69.4% to US$2.8 million in FY17, from US$9.1 million a year ago.
Revenue continued to fall for CNMC in 4Q17, slipping by 6.2% to US$4.9 million amid below-average production at its flagship Sokor gold mine in Malaysia’s Kelantan state and a drop in sales volume.
CNMC says production has been affected since 4Q16 due to lower ore grades in certain parts of Sokor.
Chen notes that the trial operation of CNMC’s carbon-in-leach (CIL) plant have yielded satisfactory results so far.
“Production at CIL plant [is] expected to kick-start in 2Q18,” says Chen. “With the help of the plant and available high-grade ore stockpiled, it is expected to see a significant improvement of output volume this year.”
Meanwhile, the analyst is also positive on CNMC’s on-going exploration on the Sokor, Pulai, and KelGold projects.
As at 2.35pm, shares of CNMC are trading half a cent up at 26.5 cents, implying an estimated price-to-earnings ratio of 21 times for FY18.
