You’re always glass half full though PF, I prefer to er on the side of caution... I have no doubt Renison will be a cash cow for the company.. particularly when prices recover and they enter higher grade zones...I’m not convinced they can run at $50m FCF pa runrate in the short term however given commodity price headwinds and the capex to develop Area 5.
If you look at the below from the annual report you can effectively get cash flows for Renison of $12m for FY19 and $15m for FY18.. (segment profit add back d&a subtract capex). I understand some of the capex around the ore sorter is non-recurring (mainly FY18) and the benefits from the ore sorter is being felt thus improving cash flows. My concerns are the tin price has fallen and is some 10-15% below the FY19 AUD Sn price and close to 20% below the quarter you are referencing ... and that’s where my $5m per quarter ($20m pa) runrate figure came from. GL
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