Onslow Transhipping, page-862

Thanks StonedFish;

Good start to the day with 2 already. Hopefully can get 5 done after 6 yesterday.

Also Highland Park left last night, which is a total of 9 ships or 1.67 m tonnes shipped in June = rate of 33.9 m tonnes per annum, almost exactly matching my current rate estimate of 33.6 m tonnes.

Below are the new numbers: 37.6 m tonne average over the last 7 days, 35 m t average since June 6.

I've also added a free cash flow table, that automatically adjusts to the current shipping rate and spot iron ore price. Key assumptions for the table are below. Let me know if you like/dislike this addition.

	MinRes Onslow estimated EBITDA per tonne Aus $ (mining + mining services)						30.5
	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	45.5	75604	172	3.44	27.6	$844
	11-May-25	39.5	78481	155	3.1	28.7	$876
	20-May-25	30.5	80000	122	2.44	29.2	$893
	01-Jun-25	18.5	91892	85	1.7	33.6	$1,025
	Current	7	102857	36	0.72	37.6	$1,148
	Free cash flow (FCF) estimates (entire business)
		Fy 26	Fy 27	Fy 28
	FCF $ m	1133	1398	874
	Price/FCF	3.9	3.1	5.0
	Unloads by Transhipper since 5 May 2025						Iron Ore price US$
	Airlie	Coolibah	Montebello	Rosily	Peak		$92.60
	41	41	40	44	5.5

Key assumptions:
1: Business produces at current rate 37.6 m tonnes in Fy 26 to Fy 28

2: Business receives a $200 m contigent payment from Hancock and also Morgan Stanley ($400 m in total) in Fy 26, which is a one off boost to cash flow in this year.

3: Business faces an effective tax rate of zero in Fy 26 and Fy 27 because of accumulated losses and accelerated depreciation on Onslow that can be used. Thereafter the tax rate is 30%, causing the P/E to rise in Fy 28, so the Fy 28 P/E is a more "normallised" figure.

4: The modelling adjusts for the Onslow carry loan being repaid over Fy 26 and Fy 27, whilst $412 m of the Iron Ore prepayment is also repaid over this period.
The one off effects of this are a boost to free cash flow of $248 m in Fy 26 and $352 m in Fy 27 at Iron Ore US $95.

5: Losses in Lithium of $28 m per year over the period.

6: Zero earnings from Non Onslow iron ore mines.

7: Major cost savings at Onslow and FOB $49 achieved in Fy 27 from autonomous haulage etc, Onslow mine earnings are $343 m in Fy 26 and $978 m in Fy 27 at Iron Ore US $95 because of the ramp up in cost savings in Fy 27.

8: Spot Iron ore price continue throughout the period (note forward curve has it decreasing to 85 ish Fy 28.

9: No increase in Iron ore production at Onslow, 37.6 m t pa throughout the period. I think this is quite conservative and now expect Onslow to operate at 45 m + in Fy 27, possibly rising to 50 m + in Fy 27, Fy 28 when two extra transhippers arrive.

Let me know what you think and where you disagree and why?

Thanks Dekka.