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Emailed the company re the capacity confusion (on Hot Copper anyway) Shanes reply:
"To clarify - yes, the plant is now upgraded to an annual capacity of 4,500tpa, but production mix can be split between HPA for the sapphire industry - e.g. 100% at 4,500tpa, or up to 1,500tpa for the Lithium-ion battery sector - in such a case production for the sapphire industry will be reduced to 3,000tpa. So we now have flexibility of product mix, but limited to overall annual output of 4,500tpa"
The BFS uses a conservative $us23k per tonne so an addition of $us11.5m of revenue -maybe more if the mix is as above - obviously costs will go up and appears the capex will to- so additional finance costs - but looks really good to me.
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@yabster - and if I did read right it was at the behest of the financiers to increase the output capacity. Seems as if the Germans have done their homework on this one (and no one should be surprised about that).
Current MC just a smidgens over 40mil.
Last edited by silu; 15-09-2017 at 04:51 PM.
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Yes due diligence done but int phrase re "no fatal flaws" but could be a lot of injuries on the way to nameplate.A good few steps up the hill, now we await the next one in a few months.
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Good presentation for this weeks investor conference:
https://www.google.de/url?sa=t&rct=j...uuUKcjOJhrnoPg
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"Prediction is very difficult, especially about the future" (Niels Bohr)
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Muti-Bagger if it all come off ....which IMHO I'm confident it will when you add in demand and advantages over peers >>>>>a core long term HOLD for me ...unless mgmt or market do something stupid
"With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future." — Carlos Slim Helu
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Originally Posted by JBmurc
Muti-Bagger if it all come off ....which IMHO I'm confident it will when you add in demand and advantages over peers >>>>>a core long term HOLD for me ...unless mgmt or market do something stupid
All looks good, but the nameplate production and when the HPA4 kicks in bothers me, can they control costs while it ramps up.
Also not happy with there scattergun approach to cap raising, burn rate needs to come down before I buy back in.
I'll pay more when things start to move in the right direction
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Originally Posted by shasta
All looks good, but the nameplate production and when the HPA4 kicks in bothers me, can they control costs while it ramps up.
Also not happy with there scattergun approach to cap raising, burn rate needs to come down before I buy back in.
I'll pay more when things start to move in the right direction
You want to expand on your comments?
What's wrong in your view with the intended production capacity? As far as I remember - the number is quite stable for years ... but has in the last design be upgraded from 4000 t/a to 4500 t/a. What is your concern?
Ah yes - and what do you mean with HPA4 kicking in? I assume you mean HPA 4N? Do you believe they can't deliver on the promised purity? Why?
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"Prediction is very difficult, especially about the future" (Niels Bohr)
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Certainly. If you refer to the Jan 19th investor information pack, page 18 the ramp up of production shows the 4,000tpa of the HPA 4N not until year 4/5 with the 1st 3 years a blend of Smelter grade and 3N product.
The disparity in pricing means any increase in costs and the figures get ugly quickly. Reading the first part of the presentation the revenue figure $92m (4,000*$23,000) isn't likely until year 4 at least.
For a long life 30+ year project, the IRR of 33% isn't earth shattering, and with all mining companies, delays, increase in costs, are inevitable.
I still like the company, just a few concerns about the timing of getting to the $$$ they are stating, plus any technical issues getting the HPA 4N purity at scale.
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Originally Posted by shasta
Certainly. If you refer to the Jan 19th investor information pack, page 18 the ramp up of production shows the 4,000tpa of the HPA 4N not until year 4/5 with the 1st 3 years a blend of Smelter grade and 3N product.
The disparity in pricing means any increase in costs and the figures get ugly quickly. Reading the first part of the presentation the revenue figure $92m (4,000*$23,000) isn't likely until year 4 at least.
For a long life 30+ year project, the IRR of 33% isn't earth shattering, and with all mining companies, delays, increase in costs, are inevitable.
I still like the company, just a few concerns about the timing of getting to the $$$ they are stating, plus any technical issues getting the HPA 4N purity at scale.
Thanks for your reply, and - fair enough.
It would be interesting to understand why they think (or thought in January) that it takes 4 to 5 years to optimise their process - even if they call their assumptions "conservative".
On the other hand - most of the output is still HPA 4N (but admittedly starting with only 50% of nameplate capacity).
Will be interesting to see whether they change these graphs as one of the outcomes of the current export credit approval process. Obviously - they changed already the design and increased the nameplate capacity. It looks like the bank does a lot of due diligence, including further investigations into the process. I guess whatever they learn now they don't need to learn anymore in the completed factory, i.e. confident they will be able to ramp up faster after this process.
All good old-fashioned derisking.
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"Prediction is very difficult, especially about the future" (Niels Bohr)
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Member
I've also just jumped on board this morning after watching these for a little while.
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