Ann: LMG increases project finance facility by $3M, page-11

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Patmeate

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06/09/24

21:07

Post #: 75569109
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Originally posted by tropic: ↑

Thanks for pointing out those items Patmeate,
Agree that it's a sensible move to extend maturity by the 9 months to hopefully have the 2027 tax rebate in hand even if we will be paying an extra 9 months interest(14%) on whatever is still outstanding on the loan.

No matter from which angle I look at this, I just can't see how the financials add up. Maybe I'm missing something.
They have pulled down the last $3M available on the loan I expect to get the plant operational.
The $6M part of capital raise is spent or committed.
DP has said that when the demo plant was 100% Mg ingots production it would just cover the operational cost.
Revenue from MgO production will be much less for 2 reasons. Demo plant operating at about 2/3 capacity; and because it's MgO which is 60% Mg rather than 100%. - the product will be a MgO/SCM composite.
That shortfall in revenue will have to be covered by cash. Where is that cash coming from when we have exhausted the loan, and little if any cash reserves??
In addition they need to progress stage 2 and cash is needed to finalise the studies for new location and BFS & FID.

I can only assume that they intend to:
do another capital raise when they announce MgO production? - doubt that Ord will be interested in underwriting it!
relying on an application to the critical minerals fund?
A new investor stumping up some cash for shares and options?(We are at 2.35B now so are they taking it toward 3B on issue?)
Use the 2024 tax rebate for working capital in the hope that they will have a more successful CR later or lure an investor. That would mean our interest payments on the loan would remain higher.

If it's an investor, I doubt they would thow cash at it for stage 1 - it would need to be for stage 2.

Am I missing a source of revenue?

Expand

solid post, heaps of detail.

isn’t there by products they get from this process that they will sell?

funding USA government would not be an absurd thought?

they did discuss selling a parcel of land, would imagine that would get a few million, actually I wouldn’t have a clue industrial land cost in the valley, anyone?

don’t be shocked if they consolidated 4:1 shares once above 10 cents or maybe even sooner. It’s all the rage with struggling companies financially lol
LMG Price at posting: 3.3¢ Sentiment: Buy Disclosure: Held
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Last 3.7¢		Change -0.004(9.76%)		Mkt cap ! $86.89M

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Ann: LMG increases project finance facility by $3M, page-11

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Ann: LMG increases project finance facility by $3M, page-11

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