The operating earnings margin increased to 53% from 49% in FY18 while net mine cash flow was a record $540m. Costs are expected to lift slightly, with the exception of Mungari. Results were slightly below expectations.
Morgans maintains an Add rating and reduces the target to $3.17 from $3.20. The main risk the broker envisages is the gold price, with operating risk ameliorated by the portfolio of producing mines.
Target price is $3.17.Current Price is $2.76. Difference: $0.41 – (brackets indicate current price is over target). If EVN meets the Morgans target it will return approximately 13% (excluding dividends, fees and charges – negative figures indicate an expected loss).