Ann: Quarterly Activities Report, page-189

I am surprised about the lack of financial analysis on the quarterly report by shareholders.
Most posts by people positive on the company seem to consist of hope that's things will improve or talk about the Corona Virus not being an issue or the number of EV sales is picking up.
Either most posters are keeping the numbers to themselves or they don't really understand the financials.

Totally agree the Corona Virus is a storm in a teacup and will not pose a problem and also that EV sales will steadily grow.

My concern however remains in the short term how the company will generate enough surplus cash to repay the debt due in 2022 plus fund both stage 2 and stage 3 development and fund the proposed JV with Cosco.

As at 31st December 2019 they have $106M in cash.
The outlook for at least the next 12 months looks fairly grim with the Lithium price currently at USA$460dmt and it could fall further over the next 6 months (Kens words not mine).

The company have forecast costs next quarter (including Interest) of $40M
Revenue is likely to to drop to nearer $20M next quarter due to the lower Spod price.

It sounds like the plant is improving but still needs more CAPEX spent to achieve what it is supposed to deliver.
So realistically the company might burn around $15M - $20M per quarter in cash for maybe the next 4 quarters.
That means this time next year the cash might be down to between $25M - $45M.

The debt due for repayment in 2022 is around $147M.

The only way they can generate some serious cash each quarter is by getting stage 2 and stage 3 up and running which will require a lot of additional CAPEX which will either have to come from a very low priced CR or high interest rate new additional debt.

They will keep eating away at the costs and you would think that the Spod price will eventually pick up which will help them but it looks to me like the next 12 months are going to be very tough.

I agree with their strategy to bunker down and preserve cash but unless they can substantially reduce the cost of production, find additional customers to take more supply and also hope that the Spod price rises then the main beneficially of this will be the directors as they can keep getting paid each month.