Deciphering Lynas, page-414

Brief update:

- April revenue is ~AU$70m, on track to match or exceed previous Q. As previously, my data in blue, reported revenue in purple (values in AU$M)



- A closer look at how our revenue is tracking with spot NdPr price (China, ex VAT).
(1) The white-ish line is monthly revenue (in million AU$, right axis). (2) In dark turquoise is rolling quarterly revenue (in million AU$, right axis). (3) As I've previously indicated, best to view our contracted NdPr price more akin a 3 months moving Av, here shown in orange (in AU$, left axis).



A few comments/thoughts:
- Overall, we have a quite clear uptrend in revenue.

- Given our likely pricing model, our NdPr price bottomed out April/May months (at around AU$90/kg).

- We have built a significant inventory lately, possibly worth >AU$100m. Given our 6m extension of C&L, we now have an option of releasing some of the inventory at current 'low' prices, or sit on it and wait for higher price in the coming months.
My personal opinion is that we will go in the middle. I do think AL cares about price (as she clearly illustrate by withholding SEG), but I do think she also cares about the balance sheet.. and my gut feeling is that if production this Q doesn't take care of it, she will sell some inventory to beat our last QR.

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A final Sunday thought: given our 6m extension of C&L and our current production rate (at or close to NEXT rate), we may again need to keep an eye on our processing limits. For newbies: the Malaysian government has processing limits imposed on LAMP, which historically has meant we could not go to NEXT rate (see Post #: 53360805). Last year we likely surpassed the limit, but AL has mentioned we were allowed to 'carry forward' some previously 'un-used' quota which likely allowed us to go over the limit.

If my estimations are correct, our lanthanide processing limit roughly equals the production of 5,400tpa NdPr. Running LAMP at NEXT rate (7,200tpa) means we will run out of quota sometime around October. We may still have some unused quota carried forward, but if not, we need to get Kal up and running and ramped to at least equal our NEXT production rate by October. If any analyst is reading this, please make enquiries regarding this during the Q call.

Questions/comments welcome.

DYOR, happy Sunday