Good post and nice to hear from you @rmkpro. Been a while. Yeah,...

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frmen1

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19/06/19

19:55

Post #: 39140002
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Originally posted by rmkpro ↑

Certainly some big numbers being thrown about @thehunter

Based on last quarters actual revenue of $7.7m a 100tj plant would be $77m quarterly and $308m annually.
For easy maths sake, last quarters production, staff and admin OPEX was $8mil. So a negative cashflow scenario still for the Kincora plant. The plant metrics will improve as production is ramped up as a large component of those OPEX costs relating to staffing admin is pretty fixed. However to ramp up production obviously requires more feed being the costly part of this business. $4.85m of expenditure for last quarter for little improvement in plant production since year end Dec 18 is certainly a disappointment.

Perfect world we can get the plant enough feed soon enough without raisng any more capital/dilutionary events for shareholders to bring it up to 20TJ production where the customer receipts, opex and field development costs should largely balance themselves out. As for a return to shareholders... that is a tough one. Once Kincora is producing 30tj more consistently as they plan, then maybe it is possible however there will no doubt be a heavy capex requirement in the next 5 years that will wipe out any chance of that I think...

We have no sales issues with the product, its just a difficult balance of lean cashflows and heavy expenditure for now and easily the next 12-24 so a 100tj plant seems a long way away at the moment!!

Im interested to hear others thoughts as always, perhaps I am a little too pessimistic in this opinion?

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Good post and nice to hear from you @rmkpro. Been a while.
Yeah, maybe you're being a tad pessimistic, each to their own though. Who'd have thought we'd be down here with our potential? We can hope that some of the recent fall is due to end of FY positions, in which case next month can't come quick enough. I was going through some charts and found an interesting similarity (attached thumbnails). Canavan CVN were also falling and looking pretty rough until this time last year when Dorado-1 was coming into the picture. What evolved into their SP was extraordinary. I can imagine similar happening to Armour one day. Might be one of our new Surat Basin tenements or even one of our NT or NQL ones. Keep the faith mate.

AJQ Price at posting: 7.1¢ Sentiment: Buy Disclosure: Held
1 Upvote

0 Great analysis

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