So I've been wargaming when we can expect this company to start generating positive cash flow for us investors.
Given that the company currently has approximately $7,040,000 in equity at the moment and requires $29,000,000 worth of capital for the commencement of stage 1 operation, this means the company will need to generate $21,960,000 worth of capital to fund stage 1.
The company believes that stage 1 of operation will be able to generate 11,000 tonnes of graphite per year for 2 years. With the average cost of graphite being $1,000 USD per tonne, this means that by the end of stage 1, the company would have generated:
1,000 (cost per tonne) x 11,000 (tonnes) x 1.54(USD to AUD) x 2 (years) =
$33,880,000 in revenue.
33,880,000 minus the cost of stage 1, leaves the company with:
33,880,000 - 21,960,000 = $11,920,000
So the company will have $11,920,000 and will need to still fund stage 2, which is expected to cost $24,000,000
This means the company will again have to generate an additional $12,080,000 to have stage 2 of the operation underway.
With stage 1 initiating production in 2027, this means that the company will still not have any positive cash flow until at least 2030 when they are expected to produce 67,000 tonnes of graphite annually. And all of this is with everything going according to plan.
Anyone want to pick holes in my calculation, am i missing anything?
The biggest fluctuation to these prices will be what the price per tonne of graphite will be. My measurements are only based off of what the average is at the moment.
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