1Q12 FD EPS $0.01. "TCM reported 1Q12 FD EPS of $0.01, which
included F/X gains and a larger than expected income tax recovery.
Excluding F/X, we estimate TCM reported an adjusted loss of $0.03,
which compares to our estimate of a loss of $0.08 and consensus
loss of $0.06."
Q1 Expectedly Weak; Operating Results Announced on April 19th.
"Compared to our EPS, higher sales and income tax recovery and
lower exploration and interest expense were partially offset by
higher operating expenses and depreciation (net +$0.05/share).
Sales of $114Mln were better than expected on higher moly sales
from purchased concentrate (2.6Mln lbs vs. our 1.3Mln lbs). Mgmt
noted that they expect operating performance in 1H12 to be less
than in 2H12, with production increasing in 2H12 due to the
anticipated ramp-up of production from the newly completed mill at
Endako along with improved ore accessibility at the Thompson Creek
mine. Mgmt reaffirmed FY12 production guidance (26-28Mln lbs moly)
and once gain reiterated that cash costs are tracking to the higher
end of the FY12 guidance range of $7.75-9.00/lb moly, largely due
to inflationary pressures on energy and consumables."
Expecting additional financing. "TCM has current cash of $163Mln
and a debt/equity ratio of 21%. Mgmt noted that they expect to
secure additional financing to meet liquidity needs, and would
expect to secure an amendment to the existing Credit Agreement. We
estimate TCM will need to seek all options to fund Mt. Milligan
construction costs through a combination of (i) current cash; (ii)
proceeds from its gold stream transaction; (iii) further debt and
equity financing; and (iv) internal cash generation. We continue to
model $600Mln of incremental capital required (debt/equity: 67/33)
over the next two years with the peak debt/equity ratio increasing
to 45% by end-2013."
Valuation: "Our revised TP of C$9.00 (from C$9.50) is based on
0.9x our revised cash-adjusted NAVPS of C$9.68 (from C$9.97). Our
NAVPS declines 3% on a lower than expected end-1Q12 cash