From Bell Potter report:
---------
With the expectation that Renison would be accessing new high grade zones at Area 5 in early 2020, we were expecting to see the operation lifting tin output and operating cash flow. In our previous note we assumed that Nifty would remain shut until June 2021 and, if not sold by then for about $40m, we forecast that MLX would need to access additional capital in 2021 to fund its operations.
We assumed additional debt would be drawn down in 2021. The downgraded Renison production in FY20 means the company is now considering its options for a capital raising in the first half of 2020.
While the market is still absorbing the recent announcement of the Nifty suspension, the revelation of lower tin production and higher costs at Renison have added to shareholders’ woes. We have incorporated the company’s downgraded production guidance for Renison in FY20. We are now forecasting higher normalised losses in FY20 and FY21 and although our forecast NPAT for FY22 is unchanged, earnings per share are forecast to be 34% lower from our assumption of a dilutive equity raising in 2H FY20. Our target price is reduced by 33% to $0.16/sh. Our Buy recommendation is retained but the MLX share price could remain weak until the market gets clarity on the Nifty and Wingellina Nickel-Cobalt Project strategic reviews and MLX’s capital needs.
------
Now it's pretty clear why APAC got so nervous
(20min delay)