The company has achieved first production at Poplar Grove and this will ramp up over 2019. First sales of coal to a contracted buyer are slated for the end of the month.
Macquarie observes that current sales agreements have significantly more risk in the first two years of operations. The broker estimates that 90% of 2019 production is contracted for sale, with LG&E accounting for 70%.
A smooth ramp-up is needed to satisfy the current contracted sales level. Outperform rating maintained. Target is $0.27.
Sector: Energy.
Target price is $0.27.Current Price is $0.14. Difference: $0.13 – (brackets indicate current price is over target). If PNL meets the Macquarie target it will return approximately 48% (excluding dividends, fees, and charges – negative figures indicate an expected loss).
