Ann: Minbos Investor Presentation - Angola Rising, page-87

"40c - dreaming and naive"

Not at all. It's coming and it will happen much sooner than previously expected based on this week's updated guidance.
A company doesn't upgrade guidance that dramatically without being given guidance themselves from their major offtake customer on how much product that customer wants to purchase.
That updated guidance gives a clear path to A$90mill per year in after tax cashflow on a project going into production by around mid next year.
That would give a sp target of closer to $1 a share on a ten times market cap to after tax cashflow multiple. Surprisingly, we had 153,000t guidance for year 1. That would only be achieved if the plant capacity was doubled from next year or if year one was 2025 calendar year rather than next year. However Lindsay just recorded an interview this week stating production starts mid next year confirming most recent ASX announced guidance.
Other than for next year which only has 6 months to reach 153,000 t, those updated sales forecasts could all be reached from stage one capacity and do not include potential export sales.
The company said in this week's update that we should watch for a doubling of plant capacity, which means 370,000tpa.. That’s more than double anything in the updated guidance. It would bring plans to double capacity forward, from year 7 to probably next year given the production and sales guidance for year 1.
If sales for year 2 and onwards are boosted further again than this week's updated guidance, then even $1 starts to look too low a target.
The updated guidance was a big increase on DFS forecasts but is still less than stage one capacity of 187,500tpa. Why bring forward plans to double capacity unless they expect to increase sales beyond this week's updated guidance? It seems they are reasonably confident that further sales are going to be made through exports either to South Africa or other neighbouring countries, or for P4.
Granted, the company probably needs to reach the updated sales targets before we see $1 but 40c could easily be reached mid next year as production begins to ramp up and $1 could start to look conservative on any export offtakes secured next year.
40c is a four fold increase in sp from yesterday's close and a four fold increase within 6 months has happened twice in the last four years despite not being anywhere near this close to production. So why is it nieve to expect it again now? This updated guidance gives a much better reason to expect a (much better than) four fold increase than we had on the previous two occasions. We can easily see a path to a ten fold increase this time, without factoring in export sales and without factoring in anything at all for the very promising looking green ammonia project. We were also told to look for news on the green ammonia regarding partners.
I think it would be much more nieve to think that 40c won't be reached next year.
You could say it would be nieve to think a dollar could be reached but I see it as a likely 2 year target and even a 1 year target if guidance is met.
Then there's the export potential plus the green ammonia for further strong upside.
That green ammonia project has secured an average 1.1c per kw for 200MW for 25 years.
That is a world leading cost advantage and it's green and very reliable as its hydro, not intermittent like solar or wind.
No wonder it's attracting so much interest from partners. That project alone justifies much more than 40c per share IMO. 40c is less than a $400mill mc. The market will catch on before long. The potential partners showing all the interest already see the value. The market can be much slower to price it in but that too will come. I have a habit of finding stocks too early and having to wait but much better early than late in my experience.

Merry Christmas everyone.