Some key info:
IMO, for Mustang we will have all the following opportunities for activities that will confirm consistency/cashflow and support improvement in share price.
- Cashflow imminent - Pre-auction ( October auction 8 weeks away )
- Cashflow confirmed, reduces risk - Post-auction ( 9 weeks away )
- Cashflow and consistency, reduces risk - Second Auction, April 2018 (now understood to be Q2. See here )
- Cashflow - Third Auction, anticipated Q3 2018 (assumed)
- Confirmation of mine life, reduces risk - Rubies JORC Q2 2018 (assumed)
- Cashflow - Fourth Auction, anticipated Q4 2018 (assumed)
- Cashflow - Fifth Auction, anticipated Q1 2019 (assumed)
- and so on ...
The above are the most significant as they are the activities are all related to the Ruby project which is the key asset that will drive income and support growth.
The following chart (my analysis) will give you an understanding of potential cashflows for different auction results. Scenarios 2 and 3 are key ( the 1st scenario is just one I used to calculate a P/E based on assumptions in the Independent Investment Research Report. See attached ).
My analysis is explained in detail here, again DYOR:
https://hotcopper.com.au/threads/mu...612726/page-158?post_id=26791143#.WafjepOg-CU
Here are the key numbers from my analysis ( not company-supplied data ).
View attachment 709647
We know from prior company investor sessions they are intending to move to 4 x smaller auctions per year, which will deliver consistency of supply to the Ruby buyers and also consistency of cashflow for Mustang.
The Graphite is relevant to future but not immediate cashflow, assume medium-term ( 3 - 6 years ). Also assume Mustang will engage in some form of JV for developing the graphite as they have indicated they are unlikely to go it alone.
DYOR.
