Ann: Galaxy Secures Spodumene Supply Agreement , page-23

re: Ann: Galaxy Secures Spodumene Supply Agre... If we disregard the shenanigans which have happened including Creat's partial sell down, the Chinese buying of Talison and the Talison supply contract a week later and now look at the fundamentals.

At full production Jiangsu can produce 17K ton Li-carb.
We do not know the plant's cost of production yet but as from yesterday we know that Talison Spodumene feed costs
$365/ton FOB WA.

$27 mil p/a saving on spodumene means 4.8 cents/share savings (560 mil shares.)

Now let's assume that when Jiangsu becomes cash flow positive later this year that the market will pay a P/E of 10; that would lift the SP by 48c alone in cost cutting.

The mothballing of Mt Catlin, IMO has three functions:
(a) It improves GXY's bottom line for now.
(b) It provides security of supply in case Talison builds
its own massive Li-Carb plant later or decides on
milking GXY later by jacking up the price.
(Mt Catlin's costs have already been factored into
GXY's SP for over a year because fundamentalists
were doing their sums while the "sentimentalists
were dreaming of lithium uses.)
(c) It will serve better to get a GXY buy-out over the line
because the FIRB will not see Mt Catlin as the second
operating lithium mine to go into Chinese ownership;
only a processing plant in China.


I seem to think, however, that a group of high powered
Creat executives & PHDs attached to a derilict tin mine in Tasmania and, up to recently, whose major Australian investment was a share of GXY is still suss in my mind.

I have written to the FIRB months ago expressing concern about the Talison take-over but obviously the FIRB as of yet does not see Chinese ownership of the world's plumb
hard rock lithium resource as a threat.

But back to fundamentals:

(1) GXY Market Cap is $205 mil as is

Surely the Jiangsu plant is worth $120 mil
and L1 assets are worth at least another $120 mil.

Without Mt Catlin this would leave the break-up value of GXY $35 mil more than today's market cap and as shareholders we have to say to the Board and Mr Tan
"What are you?" They are supposed to add value to our hard earned cash & not reduce it.

Unless there is a silly Chinese offer soon, things should
work out later in the year once the plant is up to full
production, fundamentals click-in and there are no rubery figures.

Cheers
Moorookamick