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General Information

Fortescue Metals Group Ltd
FMG
http://www.fmgl.com.au
Steel
5,340
3,114

Current Price Data+

Current Price Open High Low Last Close Volume Price Movement
$1.72 $1.78 $1.79 $1.72 $1.82 23955838 $0.11 ( 5.77% )
  • +Security prices are delayed by least 20 minutes and are indicative only.

Current Broker Consensus Recommendation

Hold
02/07/2015
5

Company Overview

Business Description
Fortescue Metals Group Ltd (FMG) is an iron ore production and exploration company with assets located in the Pilbara region of Western Australia. FMG currently holds reserves of 2.34 Bt of hematite ore within its operating Chichester and Solomon Hubs, with FY13 total ore mined and ore shipment of 94.6Mt and 80.9Mt respectively. Total resource base currently stands at 15.6Bt from both operating and development properties.
Strategy Analysis
Fortescue's goal is to become a low cost iron ore miner in the Pilbara region of WA. From an initial base of 40 million tonnes a year, the company expanded to 55 million tonnes a year in fiscal 2012. The next planned step is to 155 million tonnes at a cost of just over USD 10 billion including the new mining fleet. Fortescue aims to exit December 2013 at a production rate of 155 million tonnes per annum. Further expansions beyond 155 million tonnes will be considered but Fortescue aims to strengthen its balance sheet before undertaking any significant new capital expenditure. Fortescue Metals Group reported NPAT down 40% to US$478.0m for the half-year ended 31 December 2012. Revenues from ordinary activities were US$3.3bn, down 2% from the same period last year. Diluted EPS was 15.35 US cents compared to 25.71 US cents last year. Net operating cash flow was US$479.0m compared to US$1.19bn last year. No dividend was declared. FY13 guidance of total shipped tonnes remains between 82wMt and 84wMt. Solomon's Firetail mine is now expected to achieve a 20Mtpa run rate during April 2013 after a severe rain event caused a minor delay in construction. This will increase the company's production capacity to 115Mtpa.

Financial Summary

Year to Jun NPAT EPS EPS chg (%) PER DPS Yield (%) Franking (%)
2016 F 300.6 9.6 -42.7% 17.9 5.0 2.9% 100.0%
2015 F 524.6 16.7 -81.9% 10.2 9.2 5.4% 100.0%
2014 A 2,888.2 92.6 84.6% 5.3 20.0 4.1% 100.0%

Peer Comparison

Company Mkt Cap EPS Growth (%) P/E (%) Dividend Yield (%)
2014 A 2015 F 2016 F 2014 A 2015 F 2016 F 2014 A 2015 F 2016 F
Arrium (ARI) $397M -0.6786 0.0000 0.0000 0.5646 0.0000 54.0000 57.93% 0.00% 0.00%
BlueScope Steel (BSL) $2,029M 0.0000 0.9771 0.2612 32.8154 16.5973 13.1598 0.00% 2.19% 2.39%
Fortescue Metals (FMG) $5,667M 0.7497 -0.8651 -0.3704 1.9515 14.4674 22.9798 11.66% 3.15% 3.18%
Mount Gibson Iron (MGX) $218M 0.0351 0.0000 0.0000 2.2650 0.0000 0.0000 20.00% 0.00% 0.00%
Sims Metal Management (SGM) $2,157M 3.0215 0.3972 0.4416 31.2834 22.3900 15.5310 0.95% 2.44% 3.21%

Financial Summary

Earnings P/E Ratio P/B Ratio P/E Growth
Company 0.75 13.60 0.66 0.00
Market 0.90 15.60 1.33 1.24
Sector 0.72 11.80 0.66 0.34

Directors

Name Position Start Date
Mr Nev Power Chief Executive Officer, Executive Director 01/09/2011
Mr Peter Meurs Executive Director 22/02/2013
Mr John (Andrew) Henry Forrest Non-Executive Chairman, Non-Executive Director 18/07/2003
Ms Elizabeth Anne Gaines Non-Executive Director 22/02/2013
Dr Geoffrey (Geoff) William Raby Non-Executive Director 18/08/2011
Mr Cao Huiquan Non-Executive Director 27/02/2012
Ms Sharon Warburton Non-Executive Director 13/11/2013
Dr Jean Baderschneider Non-Executive Director 19/01/2015
Mr Mark Bradley Barnaba Non-Executive Director, Lead Independent Director 19/02/2010
Mr Owen Hegarty Non-Executive Director, Vice Chairman 13/10/2008

Management

Name Position
Stephen Pearce Chief Financial Officer
Ian Wells Company Secretary
Mark Thomas Company Secretary,Head of Infrastructure Service
Nick Cernotta Director Operations

Substantial Shareholders

Holding Name
1,033,479,247 (33.19%) Minderoo Group Pty Ltd
458,405,492 (14.72%) Hunan Valin Group

Calendar of Events

Date Event
14 April 2016 Report (Quarterly)
16 February 2016 Report (Interim)
28 January 2016 Report (Quarterly)
15 October 2015 Report (Quarterly)
15 September 2015 Report (Annual)
19 August 2015 Report (Prelim)
15 July 2015 Report (Quarterly)
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