Analysis of OZ Minerals and Resolute Mining Financial Performance

Running head: BUSINESS FINANCE
Business finance
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1BUSINESS FINANCE
Introduction
The main purpose of the report is to focus on the background of OZ Minerals and
Resolute Mining that will include the company’s competitive advantages, core activities and
the market under which the companies operate. Through the financial data obtained from the
financial statement of the companies the report will interpret the financial position of the
companies through various ratios like solvency ratio, profitability ratio and market value
ratios. Further, it will analyse the monthly share movements obtained from the ASX website
for comparing those with All Ordinaries Index (Asx.com.au 2018). Further, using the
constant dividend growth rate model the report will compute the latest stock price of the
companies for comparing it with the current stock price of the market. Finally, based on the
interpretation and analysis the report will provide recommendation regarding the
performances which in turn will assist in decision making.

2BUSINESS FINANCE
Table of Contents
Introduction................................................................................................................................1
1. Description of companies...................................................................................................3
2. Computation and analysis of the performance ratio...........................................................4
3. Graphs and comparison for share price movements...........................................................8
4. Share valuation...................................................................................................................8
Conclusion..................................................................................................................................9
Recommendation........................................................................................................................9
References................................................................................................................................10

3BUSINESS FINANCE
1. Description of companies
OZ Minerals is the Australian based mining company that is concentrated on copper.
The company was established during 2008 through merger of 2 Australian businesses for
non-ferrous metals named as Zinifex and Oxiana. The entity has the growth strategy that is
focussed on value creations for the shareholders (Ozminerals.com 2018). On the other hand,
Resolute Mining is the proven producer for gold with experience of more than 25 years. It
has experience in gold exploration, production, innovation and development. The company
has 9 gold mines all over Africa and Australia that produces more than 8 million ounces of
gold (Resolute 2018).
Core activities –
OZ Minerals operates and owns copper-silver-gold mine at the Prominent Hall and at
present they are developing one of the biggest copper gold resources at Carrapateena in
Australia. It is focussed on creation of the pipeline for opportunities. They are committed to
capital discipline, safety and their values underpin everything they do. They operates through
various mines those include Prominent Hall, Carrapateena, Antas, West Musgrave,
Centrogold and Pedra Branca. They have extensive experience in exploration in international
sites as well as Australia. Central part of their strategy is to grow through exploration for
adding value to the entity (Ozminerals.com 2018). On the other hand, Resolute Mining
operates 2 mines – Ravenswood Gold Mine in Queensland, Australia and Syama Gold Mine
in Mali, West Africa. It is one of the largest producers for gold listed under ASX with
production of more than 300,000 ounce of gold (Resolute 2018).
Competitive advantages –
OZ Minerals is one of the leading companies in Australian mineral sector. During the
past years the company redefined the ways for carrying on the business under the material
industry. Whereas the global copper levels are declining OZ Minerals produces higher grade
of copper with low level of impurities. Further, it takes short time for transit that helps in
planning the certainty for the customers (Ozminerals.com 2018).
On the other side, Resolute Mining Limited is one of the leading material companies
in Australia. Further, it has acquired 15% stake in Canadian public entity through the
transaction for an amount of $ 22.5 million. This investment will provide opportunities in