Ann: Euroz Rottnest Institutional Conference, page-15

I must say I hadn't appreciated the scale and importance of Haber until reviewing today's presentation.

Capex of roughly $A2.2 bil against annual revenues of $700 mil suggests an astonishingly high ROI. Don't forget Strike owns the major input - gas comprising 70 per cent of the cost of producing urea - so one suspects the cost base will produce a very handsome profit on that $700 mil of revenue.

Let's pick a number and follow up with some assumptions ... I am nothing other than rough and ready in my 'analysis', so apologies to those who prefer actual facts!

Let's assume that $700 mil in revenue translates to an NPAT of, what, $200 mil p.a? Seems reasonable, doesn't it? (We own the gas, don't forget.) Assume Strike trades on a PE of 10 - again, reasonable I reckon - so $200 mil translates to a market cap of $2 billion just on Haber alone. Let's further assume that by then we have two billion shares on issue - so Haber alone supports a $1.00 share price. Personally I think it possible we can get to revenue without further dilution, but let's be conservative.

Throw in gas off-take agreements plus domestic sales at a time of tightening supply and it is not unrealistic to think Strike might be a $3-5 billion company within five years - or $1.50 to $2.00 share.

Given I spent a whole five minutes thinking this through, does anyone see any glaring flaws in my broad rationale? (Feel free to adjust that $200 mil NPAT up, down or sideways - it's just my stab in the dark assuming a profit margin of 30-odd per cent.)

There is, of course, a possibility I have wildly over-estimated the upside. There's also a possibility I have sold it short.

OOO