Ann: Agreement on revised debt terms, page-20

I agree that closing Bluff (or putting it into C&M, more accurately) was the right decision, and argued in support of that action in several posts well before the decision was taken and announced.

As for the realism or otherwise of Shaw’s latest price target of 29c, it would be more useful to consider the detailed financial modelling on which that target has been based (as set out in the Shaw’s report) and identify the specific data or assumptions with which you would take issue. That would lead to a more productive debate and discussion.

The Shaw’s modelling takes into account the closure of Bluff, higher royalties at Burton, the new debt repayment schedule, the greater number of shares on issue and (assumed) higher coal prices in 2024. As the report notes, BCB is highly leveraged to movements in the coal price and the stronger coal price assumed for FY24 more than offsets other changes, delivering (on Shaw’s assumptions) an increase of 11% in EBITDA.

On my reading of the Shaw’s analysis the 29c target seems plausible and achievable, and arguably even conservative. Note that Shaw’s assumed coal price for benchmark HCC is US$250 through 2024, whereas current futures trades for coking coal next year range between US$280 and US$328.

Time will tell!