There is some interesting information in the annual report. I've...

There is some interesting information in the annual report. I've spent the past few hours reading all of it.

Some I wasn't particularly pleased with, mainly when it came to some of the earlier targets which I don't think were of benefit to the company.

One bit I wanted to share is in relation to Sal De Vida, but then attach to that a little more about James Bay.

It appears that COVID changed the course that the company planned to take at Sal De Vida, and somewhat encouraged the company to proceed alone.

Target...

Secure binding offtake
agreements for at least 75%
of first year’s production
from Stage 1.

Result...

High level of customer interest was generated with 7 MOU’s executed with relevant parties.Technology developments upgraded the product from primary to technical grade, changing the marketing approach, therefore discussion with potential offtake partners placed on hold.

Another target...

Secure an investment
partner for Sal de Vida
as long as value received
exceeds pro-rata value of
the project.

Result...

Decision taken to place the potential sell down of part of Sal de Vida on hold due to COVID related reasons with bidders unable to visit site.
Now that Galaxy has enough funding to build stage 1, a decision to sell a stake in Sal de Vida is not required for Stage 1 funding.

Another target...

Develop and implement a
financing plan for Sal de
Vida.

Result...

Financing plan developed with 10 financing alternatives developed and ranked.
Sal de Vida stage 1 funding was secured via the equity raising in November 2020

In the commentary by both Simon Hay and Martin Rowley, they also reveal a little more as to the tact which the company is taking... @SeeTheWorld this relates to your post about Simon Hay sending me a message via his comments about the James Bay converter...

SH: James Bay is ideally located to supply into either region or globally. It is our intention to integrate the project with a downstream solution through a partnering approach to secure a product offtake and tap into the higher-margin downstream sector.......Whilst at James Bay, the PEA will come to a conclusion, engineering and permitting will be undertaken and engagement with prospective downstream partners will continue in earnest.

SH: Galaxy is now adopting battery grade for Sal de Vida, opening up direct access to top tier value chains, enabling higher margins and avoiding competition in the lower grade sectors.

SH: Overall Galaxy is well on the path to achieving our corporate objective of building a sustainable, large scale, global lithium chemicals business.

MR: ...on course with its strategy to create a
large scale, sustainable lithium chemicals business to power the future.

MR: (after talking about Mt Cattlin & James Bay) With zero debt on the balance sheet
and a high degree of confidence in the future, there is also flexibility for appropriate levels of gearing to be utilised in order to maximise returns to equity holders.

I think if you look at what is being said, it indicates the level of interest for even primary and technical grade material with 7 MOU's, there will still be some available but now with the ability to produce a majority of battery grade material it takes the company to discussions with a different type of customer and perhaps some of those will already be in that group of 7.

This also goes back to something that was discussed back when Galaxy was trying to get their deal for Sal De Vida in that, if a party misses out on on supply from Sal De Vida, they still might be interested in receiving supply from James Bay.

Martin Rowley mentioning gearing indicates that they may utilise that to develop James Bay.
Also, the company has already secured finance with 10 different avenues, in which case they may chose to shift and have a debt equity balance for both Sal De Vida and also James Bay. The James Bay converter, I believe will involve a partnership with some debt attached to it also.

Whilst everyone has been focussed on Mt Cattlin and it being profitable the annual report indicates that the company is carrying Australian losses in excess of $200 million...

Page 92: In Australia tax losses of approx. US$202.3 million (2019 $US152.5 million) will be carried forward indefinitely and can be used to offset any future profits generated subject to meeting the carry forward loss testing requirements.

What this means is that any revenue from Australian assets can be offset by those losses.
Whilst the losses are silo'd to revenue here, it doesn't mean that the revenue made here can't be sent abroad. Having US$200 million in losses is incredibly handy, and this is perhaps why the company wasn't too concerned with carrying on business of operating Mt Cattlin at a loss because it was storing up money for a rainy day.

Ok cool... I am off to bed.