Almonty Industries Inc. (NASDAQ:ALM) began a 36-month share-repurchase authorization on August 24 that permits the company to buy up to 14.4 million common shares, representing approximately 5% of shares outstanding as of August 14, for as much as US$300 million.
The headline amount overstates what Almonty Industries Inc. (NASDAQ:ALM) would spend at its current valuation. At the August 24 closing price of $18.28, repurchasing the full 14.4 million shares would cost approximately $263.2 million before transaction costs. The share limit would become the binding constraint unless the average purchase price exceeds roughly $20.83.
The buyback is financially plausible because Almonty Industries Inc. (NASDAQ:ALM) ended June with C$1.23 billion of cash. First-half operating cash flow reached C$31.6 million, compared with a C$14.9 million outflow a year earlier, while second-quarter revenue increased to C$43.0 million from C$7.2 million.
Sangdong is also moving beyond construction. Almonty Industries Inc. (NASDAQ:ALM) began feeding stockpiled ore into the processing plant in June to produce saleable tungsten concentrate. Phase I is designed for approximately 640,000 tonnes of annual ore throughput, and the planned Phase II expansion could increase capacity to approximately 1.2 million tonnes.
If management is correct that the market undervalues Sangdong's future cash flow, retiring shares before the mine reaches full output could increase each remaining shareholder's participation in that growth. Almonty Industries Inc. (NASDAQ:ALM) also has flexibility to spread purchases across three years rather than committing the entire amount immediately.
#million #phase
The headline amount overstates what Almonty Industries Inc. (NASDAQ:ALM) would spend at its current valuation. At the August 24 closing price of $18.28, repurchasing the full 14.4 million shares would cost approximately $263.2 million before transaction costs. The share limit would become the binding constraint unless the average purchase price exceeds roughly $20.83.
The buyback is financially plausible because Almonty Industries Inc. (NASDAQ:ALM) ended June with C$1.23 billion of cash. First-half operating cash flow reached C$31.6 million, compared with a C$14.9 million outflow a year earlier, while second-quarter revenue increased to C$43.0 million from C$7.2 million.
Sangdong is also moving beyond construction. Almonty Industries Inc. (NASDAQ:ALM) began feeding stockpiled ore into the processing plant in June to produce saleable tungsten concentrate. Phase I is designed for approximately 640,000 tonnes of annual ore throughput, and the planned Phase II expansion could increase capacity to approximately 1.2 million tonnes.
If management is correct that the market undervalues Sangdong's future cash flow, retiring shares before the mine reaches full output could increase each remaining shareholder's participation in that growth. Almonty Industries Inc. (NASDAQ:ALM) also has flexibility to spread purchases across three years rather than committing the entire amount immediately.
#million #phase
2 months ago
