The loss of the Ghana Manganese Company (GMC) contract had previously been flagged, but the extent of the earnings impact surprised us. With developments at Boungou and Bissa “not material” to prior NPAT guidance, the $20-25m downgrade appears to have been meaningfully impacted by the loss of this contract. While PRN is a large, diverse business and we expect an ongoing transformation of AMS, risks (particularly in Africa) and the underappreciated materiality of certain individual contracts give us pause. We downgrade to HOLD (prior BUY) on a revised blended valuation of $1.95 (prior $2.20).
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