$DNN : Denison Mines — Independent Economic Analysis

Long-Term Price Case$65/lb. U308 $65/lb. U308
Flagship ProjectPhoenixGryphon
Project Percentage90% 90%
Mineral Reserves98,460,000 lbs. 98,460,000 lbs.
Shares Outstanding589,100,000589,100,000
Market Cap$342,267,100$342,267,100
Average Annual Production5.966M lbs.7.648M lbs.
LoM10 Years7 Years
Payable Product58.767M lbs.48.817M lbs.
True All-in Cost (TAIC)$39.20/lb.$47.83/lb.
Gross Revenue$3,819,855,000$3,173,105,000
Saskatchewan Revenue Royalties & Surcharges + Resource Credit($276,939,487)($230,050,112)
Total Operating Cost($194,347,597)($567,610,551)
Operating Profit$3,348,567,916$2,375,444,337
Saskatchewan Profit Royalties ($502,285,187)($356,316,651)
Income Taxes($904,113,337)($641,369,971)
Total Capital Costs($425,950,000)($539,660,498)
Net Income (Denison Share)$1,364,597,453$754,287,495
Net Profit Margin36%24%
Absolute Cost Structure (ACS)60%74%
MTQ Score (Higher is Better)0.60.3
True Value$3.60/sh.
True Value Discount (TVD)86%
Cash Flow Multiple10x5x
Net Annual Cash Flow$138,530,520$118,184,544
Future Market Cap Contribution$1,385,305,200$590,922,720
Total Future Market Cap Growth477%

Notes: All Values in U.S. Dollars

We boosted our stake in Denison Mines this morning by 25% following an updated analysis in which the company achieved a maximum in-house Composite Rating of 5. Denison Mines excelled in the following categories: Net Profit Margin (Phoenix), Absolute Cost Structure (Phoenix), True Value Discount, and Market Cap Growth. Our Target, however, has been lowered by 20%, as our updated calculations implied a True All-In Cost (TAIC) that was higher than expected for Phoenix, while Net Profit Margin and Absolute Cost Structure for Gryphon were average.

MTQ Scores & Composite Ratings — Study Group Comparison

1 Comment

Thank You Tom!
On the U tweeter community we very much miss all your insights…. I´ll try to keep track of your analysis looking at your blog. Thanks again for sharing it!!.
Quick question: Do you think that the ISR technique will work for DNN?…and If so, how will the numbers be?…Should you decide to share them, I´ll be most grateful

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