I did some estimating based on the sensitivity analysis contained in the annual report.
Hudbay earned C$85,218,000, C$1.04 basic and C$.70 diluted per share in 2005.
There were 85,631,503 basic and 124,540,000 diluted shares
Average prices received for zinc, copper, gold & silver were US$.65/lb, 1.67/lb, US$445/oz & 7.66/oz, respectively.
My guesses for Q1 2006 averges were .95, 2.15, $550 and 9.66, respectively.
If these had been the averages for 2005, Hudbay would have earned an extra C$157.1 million to total C$242.318million, C$2.885 basic and C$1.969 diluted per share.
Just to show how dramatic the price increases have been, I used the exit numbers for today and redid the calculation. Closing prices today for zinc,copper, gold & silver were US$1.293, 2.6067, $587.80 & 12.05.
If these turned out to be the average for the whole year, 2005 profits would have been C$401.418 million with C$4.77 basic and C$3.28diluted per share.
Hudbay closed today at $11.05. P/E ratio is 15.8 times TTM eps. If Q1 commodity prices hold thru 2006, the p/e would drop to 5.6 and if today's prices were the average, p/e would drop to 3.4.
This sensitivity analysis is looking backwards at 2005 production. However Hudbay has several positive events coming up in 2006. They will reopen the Balmat mine in NY State in Q2. This is a higher cost mine but will add 30,000tonnes/yr zinc production so 2006 will have additional zinc depending on the rampup time needed to get the mine to full production rates.
Hudbay also bought a copper refinery that should shave costs by a few pennies eps.
I am guessing that zinc will actually go higher than today's 1.29 price for the rest of 2006. I think it could be at $2 by year end. Similarly I expect gold to be higher. Silver and Copper may be peaking here but it's hard to tell.
Overall any way that I look at Hudbay, I think it's an amazing bargain. I don't think most investors are giving them credit for producing 100,000 oz of gold and 1.4 million oz of silver. The p/e for precious metals producers in this range are typically in the 30's IF they are even profitable.
I remain in the TABLE POUNDING MODE for HUDBAY MINERALS, INC.
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