Who is James Marsh?, page-26

calm your farm

This BOA is for KCM, profit with the least profit margin. A starter plant for example, with just KRM, would not be profitable.

SZOpen (pessimistic outlook) and Sott (that's me the optimistic one) have gone backwards and forwards about profitability on starter plant. Its marginal, and wtih my calculations I used minimal BOA volume KRM, the upper BOA limit HRM, minimal volume for bulk samples, and the rest unfilled.

Replacing KRM with CRM, would indeed be a significant step forwards. We know James has been in China and I am dead set certain many irons would be in the fire. But will we see them in time - that is the question?

The margin on KRM is poor, and I have posted on this before - really it is good as a filler, this to obtain maximum output in HRM, CRM, PRM, and filling unused capacity with KRM.

And that is why, and confirmed by ADN, KRM was only ever a TEMPORARY product line.

To sum up, these are my calcs. (With SZ discussion these were a little optimistic - and needed a negative adjustment as his rightfull reasoning was AISC in DFS would be better than AISC on starter plantn due to lower volume split over fiixed) - AISC will need to come up a little
HRM, revenue $1125 at cost of $200, profit $900 plus. - EXCELLENT - make the whole plant HRM please
KRM, revenue $500 at cost of $258, profit $242 (Sweet Stuff All)

Now I say Sweet Stuff All, as business overheads still need to come out realised revenue - in reality KCM becomes closer to feeding the Tim Jar (aka just contributing to overheads, interest, wages)

Now CRM, I didn't do the stats back then as it was not in the mix; it is a harder/more costly plant to establish, but the margins (and demand) exceed KRM significantly. If ADN supplied 50K as starter in HRM/HRM it would do well.

This announcement doesnt read well, but is well loved by our full time vested down rampers, I suspect however the silver lining far outweighs the turbulance and negativity this will create. IMO.

I havent had coffee yet, then will look at CRM figures