Skip to main content
Resources

Boss Energy Ltd (BOE): 4QFY24 highlights

Reading between the lines

BOE finished the quarter having produced 57,364lbs of U3O8 through to the drying and packaging circuit, with 28,844lbs drummed from its Honeymoon uranium project. The material was produced via the 16 operating wells and single ion exchange (IX) column. Total flow through the IX column was 327,000 m3 over the quarter, with average uranium tenor of 80mg/l and a recovery of 99.65%. Comparing to the figures in the enhanced feasibility study, which estimated a flow rate of 1,560m3/hr for the 3 IX columns (520m3/hr per column = ~1M m3 per Qtr at 90% availability) and a 47mg/l tenor from the PLS provides the indication that operationally, Honeymoon is doing better than anticipated. The question is, what has the market factored in and where are we in reference to that?

Go with the flow

We’ve run two scenarios, assuming flow rates remain constant, with the exception of lower tenors of 47mg/l in the pregnant leach solution (PLS) and lower recovery (95%). The difference in each scenario is timing of commissioning, defined as filling the IX columns with PLS. Under the first scenario, we assume commissioning at the beginning of the quarter, similar to IX 1 which was commissioned in early Apr-24, and the second scenario we assume a mid-quarter commissioning. The greatest variability outside commencement of commissioning will be the PLS tenor and recovery. Should the current conditions hold, BOE is in a comfortable position to beat guidance and consensus for FY25 production, in our opinion. Visible Alpha production consensus is 850Mlbs for FY25, scaling from 103klbs in Sep-Q to 321klbs in Jun-25.

Investment Thesis – Buy, Target Price $5.75/sh

Our target price decreases to $5.75/sh (previously $5.90/sh), on incorporation of the quarterly result. We continue to see value in BOE at these levels, with the market remaining cautious on production and uranium prices over FY25. BOE needs to rebuild the momentum and faith in the market, which in our opinion will occur over the next six months as they prove the ramp up of Honeymoon and Alta Mesa.

To read the full report click the button below.

View Detailed Report
Authored by Regan Burrows – Analyst – at Bell Potter Securities, 25 July 2024
Important Disclaimer—This may affect your legal rights: Because this document has been prepared without consideration of any specific client’s financial situation, particular needs and investment objectives, a Bell Potter Securities Limited investment adviser (or the financial services licensee, or the proper authority of such licensee, who has provided you with this report by arrangement with Bell Potter Securities Limited) should be consulted before any investment decision is made. While this document is based on the information from sources which are considered reliable, Bell Potter Securities Limited, its directors, employees and consultants do not represent, warrant or guarantee, expressly or impliedly, that the information contained in this document is complete or accurate. Nor does Bell Potter Securities Limited accept any responsibility to inform you of any matter that subsequently comes to its notice, which may affect any of the information contained in this document. This document is a private communication to clients and is not intended for public circulation or for the use of any third party, without the prior approval of Bell Potter Securities Limited. In the USA and the UK this research is only for institutional investors. It is not for release, publication or distribution in whole or in part to any persons in the two specified countries. This is general investment advice only and does not constitute advice to any person.
Disclosure of Interest: Bell Potter Securities Limited receives commission from dealing in securities and its authorised representatives, or introducers of business, may directly share in this commission. Bell Potter Securities and its associates may hold shares in the companies recommended.