"strengthen the balance sheet and provide funding flexibility to accelerate the development of the Sal de Vida and James Bay projects"
It looks like we are building JB and SDV concurrently. Quick execution is key, so i'm in favour.
The NPV of SDV is A$1.4bn give and take. Galaxy is gathering A$500mio to fund SDV.
Source of funds:
1. Operating cash flow CY2017 +2018 of A$277mio
2. Prepayment on offtakes, 25kt LCE at US$13,000 (50% upfront) = A$213mio
3. Private placement (100mio shares at 54cent) A$54mio, assuming half goes to SDV i.e. A$27mio
Total = 277 + 213 + 27 =
A$517mio
Galaxy is asking for a bit of money from shareholders (in this case from fundies) in order to unlock the full potential of SDV. Turning A$500mio into A$1.4bn in present value terms sounds great to me!
Model Update
|
Column 1 |
Column 2 |
Column 3 |
| 1 |
Calendar Year |
2020 |
|
| 2 |
SDV |
|
|
| 3 |
LCE production tonnes |
35,000* |
|
| 4 |
Price per tonne |
10,300 |
|
| 5 |
Operating Cost per tonne |
2,959 |
after potash credits |
| 6 |
EBITDA (USD) |
256,935,000 |
|
| 7 |
AUDUSD |
0.76 |
|
| 8 |
EBITDA (AUD) |
338,072,368 |
|
| 9 |
Attributable to GXY (100%)** |
338,072,368 |
|
| 10 |
Interest (100m debt) |
10,000,000 |
|
| 11 |
Depreciation |
466,206 |
|
| 12 |
Taxes @ 30% |
98,281,849 |
|
| 13 |
NPAT (AUD) |
229,324,314 |
|
| 14 |
EPS of SDV (1933m shares) |
0.119 |
|
| 15 |
|
|
|
| 16 |
Mt Cattlin |
|
|
| 17 |
Spodumene tonnes |
218,000 |
|
| 18 |
Price per tonne |
727 |
|
| 19 |
Operating Cost per tonne |
250 |
|
| 20 |
EBITDA (USD) |
103,986,000 |
|
| 21 |
AUDUSD |
0.76 |
|
| 22 |
EBITDA (AUD) |
136,823,684 |
|
| 23 |
Interest AUD (USD 40m debt) |
3,684,211 |
|
| 24 |
Depreciation |
344,148 |
|
| 25 |
Taxes @ 30% |
39,838,598 |
|
| 26 |
NPAT (AUD) |
92,956,728 |
|
| 27 |
EPS of Mt Cattlin |
0.048 |
|
| 28 |
|
|
|
| 29 |
Total EPS |
0.167 |
|
| 30 |
PE |
12.00 |
|
| 31 |
Target SP |
2.00 |
|
*upgraded from 25ktpa to 35ktpa LCE from SDV, because putting together a strong SDV team with 200 years of combined brine experience, I don't think AT is only wanting a 25ktpa capacity. As AC pointed out, 50ktpa is more likely.
** With the above funding structure, 100% ownership of SDV is achievable
I'm still seeing a target price of at least A$2.00 even after incorporating the new 100mio shares to be issued
