Yahoo Finance Black Rock Mining Limited (ASX:BKT): When Will It Breakeven?
With the business potentially at an important milestone, we thought we'd take a closer look at Black Rock Mining Limited's (ASX:BKT) future prospects. Black Rock Mining Limited engages in the exploration and development of graphite projects in Tanzania. On 30 June 2022, the AU$161m market-cap company posted a loss of AU$6.1m for its most recent financial year. Many investors are wondering about the rate at which Black Rock Mining will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.
See our latest analysis for Black Rock Mining
Expectations from some of the Australian Metals and Mining analysts is that Black Rock Mining is on the verge of breakeven. They anticipate the company to incur a final loss in 2023, before generating positive profits of AU$4.5m in 2024. Therefore, the company is expected to breakeven roughly 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 109% year-on-year, on average, which is rather optimistic! If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
We're not going to go through company-specific developments for Black Rock Mining given that this is a high-level summary, but, bear in mind that by and large metals and mining companies, depending on the stage of operation and metals mined, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.
Before we wrap up, there’s one aspect worth mentioning. Black Rock Mining currently has no debt on its balance sheet, which is rare for a loss-making metals and mining company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
Next Steps:
This article is not intended to be a comprehensive analysis on Black Rock Mining, so if you are interested in understanding the company at a deeper level, take a look at Black Rock Mining's company page on Simply Wall St. We've also compiled a list of relevant factors you should further examine:
Historical Track Record: What has Black Rock Mining's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Black Rock Mining's board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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