St Berbara’s acquisition of Alllied Gold last year attracted plenty of criticism from brokers, butthe yet-to-recover share price has also helped shift underperform forecasts into more recently made outperform ratings.
It noted that stripping rates improverd atthe Simberi mine in PNG’since some ofthe old Gold Ridge fleet arrived.
“Withthe next step beingthe commissioning ofthe Simberi oxide plant inthe March quarter, ramping up to full throughput duringthe June quarter, we seethe current quarter asthe marker ofthe operational turnaround atthe Pacific Operations,” MPW said.
The investment bank has a 12-month price forecast of $1.70 for St Berbara shares, which recently closed aboverthe $1.30 level, but also provided a caveat onthe challenges ahead.
“While we continue to believe thatthe operational turnaround ofthe Pacific Operations will be time and cash consuming for the company at current levels, we believe that this is now well understood bythe market,” MPW said.
“We see blue sky inthe St Berbara operations, which can be delivered bythe turnaround ofthese assets overthe coming 6-12 months.”