A2m PE and price Forecast with increasing sales, page-56

I’d like to take a mo to clear up, in a neutral way, the “Synlait operating at full capacity” statements kicking about.

Hope, this also offers some perspective for those trying to feel out more exactly how much further upside there is, and just how much a2 platinum production growth we should expect within the FY16 year.

What Synlait actually said was,  

“Three dryer operation (D1, D2 and D3) operating at near capacity”

This was clarified further at the agm as follows;

“Total sales volumes set to grow from 97,800MT in FY15 to an estimated 122,500MT in FY16”

That was a very recent estimate made by SML, at the agm, a few weeks ago. They also told us;

“Dryer three commissioned in late September 2015, within budget, increasing total production capacity from 90,000MT to 140,000MT per annum”

Thus as at FY16, in August 2016, SML are telling us that they expect the Dunsandel plant will be operating at a capacity of;

122,500 / 140,000  =  87.5%

My estimate for a2 platinum production volumes for the FY15 year was around 12,000MT.

If let’s say 85% of the anticipated SML FY16 growth guidance arises from a2 production, a fair assumption in my opinion, than FY16 a2 platinum production volumes should be around;

(122,500 – 97,800) x 0.85  =  20,995MT, which is around about a 75% increase on the prior year.

We each may draw our own conclusions from that.