The metallisation plant has always been targeted as a first revenue stream (which will make debt for Dubbo more sustainable). At present the cash flow to get it up and running is the issue so any funds held must go there first. Particularly since potential cost of debt for Dubbo has gone up (interest rates). Metals plant will make $40 mill profit annually on 270 mill revenue total which incurs annual costs of 240 mill. Assume a 6 month lag between costs and revenue (usually wise to assume 2 quarters costs) then 120 mill needs to support the running of the Korean plant. After that it is cash flow positive. This is the economics of establishing and growing a new business.
The current level of funds being raised is probably ok to get the plant paying for itself. The share price should certainly go up once the plant prove viable.
My opinion. Welcome comment.
ASM Price at posting:
$1.78 Sentiment: Hold Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)