Ann: IN SITU EXPANSION STUDY DELIVERS STRONG VALUE ADD POTENTIAL, page-5

After a quick look couple of concerns:

The commodity prices on page 28 are all higher than where current spot prices are. Not sure how they get the zinc price staying stable or increasing if they are putting new volumes into the market. The sensitivity analysis shows how large a 20% drop in zinc prices can change the NPV - cutting it by more than half.

Also they are using a TC of $170/dmt based of a 10 year average - however given the short life of the project as currently stands (around 6 years) if the TCs stay elevated this would also have a large negative impact on NPV. Also same concern on adding large volumes of concentrate to the market with expansions and expecting TCs to go down.

Also they buried this line in page 5 on the current performance which would probably also explain some of the recent share price performance:

Recovery performance ramp up status and schedule: Successful achievement of 55%+ recovery at a stable 6Mtpa mining rate Instability from mining expansion to 8Mtpa and a short term plant bottleneck in the cleanercircuit resulting in June 2019 quarterly recovery currently averaging 44%

Positives are they reduced the CAPEX costs of Case 1 and seem to be producing a lot of metal.

Looks like the higher metal production as a result of higher volumes is what will compensate for the lower recoveries - however seems like Jun qtr will be another quarter where they aren’t really generating large amounts of positive cashflow and will almost certainly need to tap the market if they go ahead with this expansion.