Endomines - Trending in the right direction
The company’s fundamentals are moving in the right direction while the gold market remains hot. We revise our TP to EUR 6.5 and upgrade our rating to HOLD.
A Finnish mining company with diversified project portfolio
Endomines is a mining company active in exploration, development and mining of gold deposits in Finland and in the United States. The company’s current strategic focus is on the Finnish operations where it produces gold concentrate in its processing facility in Pampalo and conducts exploration both in Pampalo and other parts of the Karelian Gold Line. Endomines is currently promoting its non-core US deposits located in Montana and Idaho through a partnership model, in addition, we consider divestments likely if the company finds a willing buyer.
Production and resources growing, strong market supports
Endomines’ production grew 49% y/y to 12,790 ounces in 2023. With the change in mining method for Pampalo UG mine and opening of Hosko, the company aims to increase gold production further by 15-35% in 2024 compared to last year. In addition to production, Endomines has been able to increase its resources in the Karelian Gold Line. Endomines currently has a total ore reserves of 32,200 ounces in Pampalo and resources of over 310,000 ounces in the Karelian Gold Line. The company aims towards one-million-ounce gold mineralization in the Karelian gold line with various potential exploration areas for example in the Southern part of the gold line. While production and resources are trending up, the gold market remains hot trading at historically high levels. With the strong gold market and expected growth in production, we now estimate net sales of EUR 31.4m and EBIT of EUR 6.5m in 2024E.
HOLD (SELL) with a TP of EUR 6.5 (5.6)
The company’s share price has declined slightly since we downgraded our rating ahead of the H2 2023 report. Since then, the gold market has strengthened considerably, and the company’s fundamentals have moved in the right direction. We continue to base our valuation on the lower range of our SOTP-model. We increase our TP to EUR 6.5 and rating to HOLD.
Endomines is a mining company active in exploration, development and mining of gold deposits in Finland and in the United States. The company’s current strategic focus is on the Finnish operations where it produces gold concentrate in its processing facility in Pampalo and conducts exploration both in Pampalo and other parts of the Karelian Gold Line. Endomines is currently promoting its non-core US deposits located in Montana and Idaho through a partnership model, in addition, we consider divestments likely if the company finds a willing buyer.
Production and resources growing, strong market supports
Endomines’ production grew 49% y/y to 12,790 ounces in 2023. With the change in mining method for Pampalo UG mine and opening of Hosko, the company aims to increase gold production further by 15-35% in 2024 compared to last year. In addition to production, Endomines has been able to increase its resources in the Karelian Gold Line. Endomines currently has a total ore reserves of 32,200 ounces in Pampalo and resources of over 310,000 ounces in the Karelian Gold Line. The company aims towards one-million-ounce gold mineralization in the Karelian gold line with various potential exploration areas for example in the Southern part of the gold line. While production and resources are trending up, the gold market remains hot trading at historically high levels. With the strong gold market and expected growth in production, we now estimate net sales of EUR 31.4m and EBIT of EUR 6.5m in 2024E.
HOLD (SELL) with a TP of EUR 6.5 (5.6)
The company’s share price has declined slightly since we downgraded our rating ahead of the H2 2023 report. Since then, the gold market has strengthened considerably, and the company’s fundamentals have moved in the right direction. We continue to base our valuation on the lower range of our SOTP-model. We increase our TP to EUR 6.5 and rating to HOLD.