@RandallGraves, your working on capex are erroneous and largely redundant in any case. Not sure where you got the "$420M capex" from, but the Ann Rep spells out pre-production capex spent to date is ~$350M incl $29M spent 2021 mostly before the $130M final CR and FI.
Expected capex plus owners/finance/working cap from $130M CR presso was $338M, less $17M working cap and 'some' non-capitalised Finance Costs & Fees and the expected pre-prod capex was around $320M all up (including contingency which always seems to get used), and so about 10% overs by end FY23. "Right of use lease assets" are post-production plant/equipment on lease, where the asset is balanced against lease liabilities on the balance sheet, and annual lease repayments and depreciation come off the operating cashflow and profit respectively.
Cashflow accurately captures the payments for mine development activites, $380M in total incl $29M FY2021. Regardless of any cost-shifting from opex to mine dev capex late FY23, the market is looking forward to cash-in vs cash-out moving forward as any capex shifting games will be a mute point. Coburn has to start washing it's own face and making serious free cash top repay debt sooner than later... simple as that.
Cash Out-Flow Forecast... The Brokers have capex at $27m on STA guidance from CR presso, interest, debt repayments etc all just maths. Op Costs, Other Costs are a thumb suck, as above Morgans forecast $126M FY24, Shaws $131M and me $135 (going to run with my $135M because I'm not a selling my own book like the brokers, who always flatter their client). Sales Revenue in is the other critical variable, which relies on Production volumes, USD product prices and AUD rate... I come up with A$185M Revenue FY24 by using Shaws production volumes but Morgans more realistic product prices (especially since China GDP and RE turned south, and ILU confirmed demand dropping off since broker reports were made)...
They have $70M cash on hand beyond the table below, and the NAB debt fascility can be rolled over which takes some pressure off. Ultimately though, Coburn needs to make some good free cash because it's debt repayment crunch time sooner or later, and modest margins won't be enough to prevent more share price pain.
Until and unless Coburn gets up to >90% planned ore production rates and >90% planned grade and recoveries to final products they are heading for failure. July and Aug were dismal months with little improvement based on 6000t Ilmenite shipment, Ann Rep commentary and share price reaction. Keep in mind every mine has a monthly reconciliation where the surveyors, engineers, metallurgist and geologists submit their final figures on movements, production, vs ore reserve model etc. Management can talk BS to important shareholders during the month about "things on the improve" and generally sound upbeat, but by first week of new month savvy players simply demand to know what the August monthly production stats and reconciliation came in at... just the facts please.
It's too early to know where the opex costs will end up in steady-state production, but that's somewhat irrelevant if production cannot get up close to nameplate average over any one month right. First thing to prove is Coburn can process 23Mtpa ore at close to design recoveries as planned, or close enough to still repay debt and build shareholder equity. Then consider the actual final product volumes/spec vs grade, recovery, quality and costs to produce it verses the commodity price forecast to see where Coburn falls on the World Class to Turd Class scale of mineral sand deposits...
GLTAH
STA Price at posting:
13.5¢ Sentiment: None Disclosure: Held
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