Ann: Production Ramp-Up At Thunderbird, page-22

@Hiepn2_2005 My take is that you are more or less correct here albeit with some texture missing.

I would summarise the state of play as follows:

1. The ramp up throughput is tracking to the BFS projections. (On budget)
2. The higher than expected oversize is adding additional unbudgeted production cost. (-ve variance)
3. Input cost inflation (e.g. logistics cost) is also adding to the production cost overrun. (-ve variance)
4. WCP and CUP Plant Concentrate recovery rate better than expected (+ve variance)
5. Zircon Concentrate market price realised lower than BFS forecast) (-ve variance).

One would hope that CI initiatives overtime would reduce the production cost per unit of product. Time will tell.

One would also hope production cost per unit of product would reduce as the plant moves towards nameplate throughput rates.

The big unknown is where is where overall TB profit and therefore SFX profit stands compared to budget once this has all played out.

This unknown is exactly why the market is beating up the shareprice in recent days.

GLTAH

-DGT