Game over for Shorts, Onslow financials at current prodn and 50 m t pa production

Last night, i called game over for the shorts in Mins.

Below is a discussion of the reasoning and financials.

My reasoning is they are currently doing 38 m t pa at Onslow, and with good weather, Haul rd and trucking capacity improving, this trajectory is only going to grow from now.

Here's what the financials look like:
I've added a new line in my table, current production, 38 m t, to give an idea of the free cash flow generation at current spot on iron ore prices, and FOB cost $58.
They are generating $1.2 bn of free cash flow a year.

The rest of the mining services business basically covers the interest cost on the debt, so this free cash flow can all be put to debt reduction, and they'll have paid off their entire $5.4 bn of debt in about 4 years, where the first debt repayment isn't due for 2 years!

	MinRes Onslow estimated EBITDA per tonne Aus $ (mining + mining services)						31.6
	Date since	Total days	Rate shipped per day tonnes	Total transhipper unloads	Total shipped (tonnes million)	Rate per year(million tonnes)	Free cash flowFY 26 Onslow(FOB AUD 58), $ m
	05-May-25	42	73810	155	3.1	27.0	$852
	11-May-25	36	76667	138	2.76	28.0	$885
	20-May-25	27	77778	105	2.1	28.4	$897
	01-Jun-25	15	90667	68	1.36	33.1	$1,046
	Current	4	105000	21	0.42	38.4	$1,212
	Unloads by Transhipper since 5 May 2025						Iron Ore price US$
	Airlie	Coolibah	Montebello	Rosily	Peak		$93.85
	37	37	37	40	3.5

But the actual forward financials will look a lot better than this simple snap shot.

Once Transhippers 6 and 7 are delivered, i expect Onslow to be operating at 50 m t per annum from June next year, and this is what the long run financials look like:

The P/e is 3.5 X at spot iron ore of $94. The business is robust to all feasible iron ore price scenarios, with the P/E 4.6 x at Iron $80, and 5.9 x at Iron Ore $70.

The financials will actually look a lot better than this table below short term, as the effective tax rate will be significantly below the 30% assumed in this model, and they'll be entitled to 80% of the free cash flow from the mine whilst the carry loan is repaid, rather than the 60% assumed in the model.

Based on all this, i think it's quite feasible if the company wants, it will be debt free in about 3 to 4 years time.

Debt is no an issue at all.

The shorts can knock themselves out as much as they want with their ridiculous rumoutrage and irrelevant nonsense. It is an absolute train wreck for them, and my view is Mins will be a + $50 stock one year from now.