$54m Placement by Cannacord, page-17

"strengthen the balance sheet and provide funding flexibility to accelerate the development of the Sal de Vida and James Bay projects"

It looks like we are building JB and SDV concurrently. Quick execution is key, so i'm in favour.

The NPV of SDV is A$1.4bn give and take. Galaxy is gathering A$500mio to fund SDV.
Source of funds:
1. Operating cash flow CY2017 +2018 of A$277mio
2. Prepayment on offtakes, 25kt LCE at US$13,000 (50% upfront) = A$213mio
3. Private placement (100mio shares at 54cent) A$54mio, assuming half goes to SDV i.e. A$27mio

Total = 277 + 213 + 27 =A$517mio

Galaxy is asking for a bit of money from shareholders (in this case from fundies) in order to unlock the full potential of SDV. Turning A$500mio into A$1.4bn in present value terms sounds great to me!

Model Update

	Column 1	Column 2	Column 3
1	Calendar Year	2020
2	SDV
3	LCE production tonnes	35,000*
4	Price per tonne	10,300
5	Operating Cost per tonne	2,959	after potash credits
6	EBITDA (USD)	256,935,000
7	AUDUSD	0.76
8	EBITDA (AUD)	338,072,368
9	Attributable to GXY (100%)**	338,072,368
10	Interest (100m debt)	10,000,000
11	Depreciation	466,206
12	Taxes @ 30%	98,281,849
13	NPAT (AUD)	229,324,314
14	EPS of SDV (1933m shares)	0.119
15
16	Mt Cattlin
17	Spodumene tonnes	218,000
18	Price per tonne	727
19	Operating Cost per tonne	250
20	EBITDA (USD)	103,986,000
21	AUDUSD	0.76
22	EBITDA (AUD)	136,823,684
23	Interest AUD (USD 40m debt)	3,684,211
24	Depreciation	344,148
25	Taxes @ 30%	39,838,598
26	NPAT (AUD)	92,956,728
27	EPS of Mt Cattlin	0.048
28
29	Total EPS	0.167
30	PE	12.00
31	Target SP	2.00

*upgraded from 25ktpa to 35ktpa LCE from SDV, because putting together a strong SDV team with 200 years of combined brine experience, I don't think AT is only wanting a 25ktpa capacity. As AC pointed out, 50ktpa is more likely.

** With the above funding structure, 100% ownership of SDV is achievable

I'm still seeing a target price of at least A$2.00 even after incorporating the new 100mio shares to be issued