Proactive investorsLogo Proactive Investors UK Website

Search field

1 year chart

digital-look imported chart image

1 day chart

digital-look imported chart image
Epic & Msn data
Epic RRS
Time: 16:35:17
Mid Price: 4984.00
Change Today: 8.00 Ascending
Change % Today: 0.16 Ascending
Fifty Two Week High: 5345.00
Fifty Two Week Low: 2823.00
Market Capital: 4488.61
Period & price data
Period Price
Now: 4984.00
3 Months ago:
6 Months ago:
1 Year ago:
Additional information
Additional Information
Market: LSE, NASDAQ
Sector: General Mining - Gold
Epic: RRS
News: Latest news
Web Site: Randgold Resources
Other Articles: 10-11-200903-11-200902-11-2009

Randgold Resources

Randgold Resources is a gold focused mining and exploration focused on discovering world-class gold deposits and converting them into profitable mines.
 
Major discoveries to date include the 7.5 million ounce Morila deposit in southern Mali, the 7 million plus ounce Yalea deposit at Loulo in western Mali and the 4 million plus ounce Tongon deposit in the Côte d'Ivoire.
 
The company recently decided to proceed with the development of a mine at its Tongon project. First gold production is scheduled for the fourth quarter of 2010.
 
Randgold Resources has an extensive portfolio of organic growth prospects, constantly replenished by its wide-ranging exploration programmes in the major gold regions of Mali, Senegal, Burkina Faso, Côte d'Ivoire, Ghana and Tanzania.
Tuesday, November 03, 2009

Randgold Resources’ projects and developments are moving ahead at a rate of knots

by Fat Prophets company news image

A further indication that equity markets are returning to ‘normality’ is a growing level of M&A activity.  African focussed gold miner Randgold Resources (LSE, RRS) has not missed the boat acquiring Moto Goldmines, a move which has bolstered the group’s gold reserve base at a time when the price of gold looks set for further strength.

Moto’s main draw is its namesake project located in the Democratic Republic of Congo or DRC.  As per an optimised feasibility study carried out in March this year, the project boasts ‘probable’ mineral reserves of 5.5 million ounces of gold and 20 million ounces of resources.

This proved the trigger for a flurry of corporate interest and prompted Randgold’s near US$500 million part equity, part cash offer.  Encouragingly, the takeover sees Randgold partner once again up with Anglogold Ashanti, with whom it has previously combined at the Morila mine in Mali; the doubling of the intellectual capital in our view will drive the Moto project forward with greater success.

The project itself is considered one of the biggest and best that Africa has to offer. Just how big is best demonstrated by the fact that the planned mine life is currently estimated at 16 years.  And although located in the DRC (which is regarded as a high risk mining area), we believe the acquisition will prove a shrewd piece of business. 

Elsewhere, Randgold’s projects and developments are moving ahead at a rate of knots.

Third quarter production numbers are due out shortly however if this years second quarter performance is anything to go by, Randgold’s flagship Loulo mine (located in Mali) will post another quarter on quarter output jump. Randgold’s other producing mine, Morila (also in Mali) may have been successfully converted from a mining operation to stockpile treatment however it will contribute to earnings for some time yet.

Although Moto may be the big money signing receiving all the attention, Randgold has plenty of home grown projects waiting to break into the first team and become earnings accretive. 



In the Ivory Coast, the Tongon project is on track to begin gold production in the fourth quarter of 2010.  At the last time of asking probable reserves stood at 3.16 million ounces.  In addition, earlier this year the Randgold announced a 3.4 million ounce inferred resource at the Massawa target in Senegal.  A pre feasibility study is set to follow before the year end.
  
Focussing on the balance sheet, gearing in terms of long term debt is extremely low.  Earlier this year the company bolstered its balance sheet through an equity placing. As at the halfway point of the year the company boasted a cool US$220 million in cash. 

From a valuation perspective a forward earnings multiple of 77 times is high.  That said this drops to 38 in 2010 and gold miners have traditionally traded on premium ratings.  In addition, the company’s growth pipeline and tremendous track record provide justification and evidence that long term earnings are well supported. 

To access more complimentary research reports from Fat Prophets click here.

Fat Prophets NewsNow icon AddThis Feed Button
Register here to be notified of future Randgold Resources articles.
View all Fat Prophets articles here

Other Randgold Resources articles

More articles ►

Other Randgold Resources news

More news ►

Investors interested in Randgold Resources recently viewed


No investment advice

The Company is a publisher and is not registered with or authorised by the Financial Services Authority (FSA). You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.