DCF Studio

    BGL.AX · ASX · Basic Materials

    Bellevue Gold Limited

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    AUD -0.88

    Market price

    AUD 1.61

    Implied upside

    -154.6%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case

    AdjustedSome line items were not reported and have been derived. Each one is labelled in the workings below.
    AdjustedOnly 2 year(s) of history available to anchor assumptions on.
    AdjustedFree cashflow is negative in at least one forecast year, so terminal value carries most of the valuation.
    AdjustedCapital expenditure runs at 77.7% of revenue against depreciation of 9.0%. A perpetuity has to be a steady state, so the terminal year uses maintenance capex at depreciation and then charges the reinvestment terminal growth requires (g/ROIC of NOPAT). The bridge is shown under Terminal Value.

    Current EV/EBITDA of 22.1x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    AUD -0.88-154.6%
    Exit multiple
    AUD 7.47+362.8%
    Market price
    AUD 1.61

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (AUD). Outflows negative.

    -2085965553-10429827770FY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayAUD
    LineFY26FY27FY28FY29FY30CAGR
    RevenueAUD 758.8mAUD 1.1bnAUD 1.7bnAUD 2.6bnAUD 3.8bn+50.0%
    EBITAUD 161.2mAUD 241.8mAUD 362.7mAUD 544.0mAUD 816.0m+50.0%
    NOPATAUD 112.8mAUD 169.2mAUD 253.9mAUD 380.8mAUD 571.2m+50.0%
    Add depreciation & amortisationAUD 68.4mAUD 102.6mAUD 153.8mAUD 230.8mAUD 346.1m+50.0%
    Less capital expenditureAUD -589.8mAUD -884.7mAUD -1.3bnAUD -2.0bnAUD -3.0bn+50.0%
    Less increase in working capitalAUD -3.5mAUD -5.2mAUD -7.8mAUD -11.7mAUD -17.6m+50.0%
    Free cashflow to firmAUD -412.0mAUD -618.1mAUD -927.1mAUD -1.4bnAUD -2.1bn-50.0%
    Discount factor0.94320.83920.74660.66430.5910-
    Present valueAUD -388.7mAUD -518.7mAUD -692.2mAUD -923.8mAUD -1.2bn-33.5%
    Present Value Of The ForecastAUD -3.8bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate5.35%Australian Government 10-year (RBA F2)
    Equity risk premium6.00%Market assumption
    Beta1.380Reported 1.567, pulled toward 1.0 (Blume)
    Cost of equity13.63%Risk-free + beta x equity risk premium
    Cost of debt5.35%Floored at the risk-free rate (implied cost of debt was lower)
    Market capitalisationAUD 2.4bn87.6% of capital
    Total debtAUD 342.3m12.4% of capital, book value as a proxy
    Tax rate30.0%Effective, capped at statutory
    WACC12.40%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareAUD -0.88

    -289% of EV

    Forecast FCFF, final year
    AUD -2.1bn
    Capex at depreciation, working capital in reinvestment
    AUD 571.2m
    Less reinvestment at g/ROIC (20.2% of NOPAT)
    AUD -115.2m
    Capitalised
    AUD 456.0m
    ROIC (WACC floor)
    12.4%
    Terminal value, undiscounted
    AUD 4.7bn
    Terminal value, discounted
    AUD 2.8bn
    Enterprise value
    AUD -965.2m
    Less net debt
    AUD 190.7m
    Equity value
    AUD -1.2bn

    Exit at 20.0x EBITDA

    Value per shareAUD 7.47

    138% of EV

    Terminal value, undiscounted
    AUD 23.2bn
    Terminal value, discounted
    AUD 13.7bn
    Enterprise value
    AUD 10.0bn
    Less net debt
    AUD 190.7m
    Equity value
    AUD 9.8bn

    Sensitivity

    Value per share (AUD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    10.40%-0.45-0.43-0.42-0.41-0.39
    11.40%-0.70-0.69-0.68-0.67-0.66
    12.40%-0.90-0.89-0.88-0.87-0.86
    13.40%-1.06-1.05-1.04-1.03-1.02
    14.40%-1.19-1.18-1.17-1.16-1.15

    Outlined: this model. Green text: above today's price of 1.61. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputModelImpliedGap
    EBIT margin21.2%39.4%+18.2pp
    Discount rate12.4%6.5%-5.9pp
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.