As per the Annual Report 2019 , we find the following breakdown of interests held in Argentina as follows:-
" The key assets of Orocobre are a 66.5% interest inOlaroz, a 25% interest in the Cauchari Lithium ProjectJoint Venture together with a 33.3% shareholding inAdvantage, a 75% economic interest in the NarahaLithium Hydroxide Plant and 100% of Borax.
So as at June 30 2019 SDJ PTE represented approx 40% of the ORE's group Net Profits. And of course we know that these ' segments ' have swung into net operating losses in the half to 31st December 2019. However , if you stick to the full year accounts for comparison's , after allowing for the allocations of group interest , and non cash charges like depreciation which had been allocated , you will find there is not much change from the EBTIX3 line and Net Profit Line which most likely would only be effected by around the A$5 million mark , with a corresponding hit to Top Line sales hit of no more than say around A$10 Million in this current environment should it last the minimum 1 month.
Where I see it getting a little bit more ' dicey ' and a bigger problem is if they have to compensate and bring forward ' employee costs ' in managing there workforce. Because they only had cash allocated to this operation of only usd $29.925 million showing allocated for this part of their operations in their accounts as at 30th June 2019.
So should they actual require more and have to draw additional ' reserves ' from their remaining cash held at that time of $249.873 million ( obviously this has changed since ) - then this could be a problem if it extends beyond 31st March 2019
Now whether some of they're employee will be able to remain on site due to the remoteness of the operations - ie in camps etc....will remain to be seen in regards to the finer details of the Governments proposed Lock Down measures.
Lets hope the overseas markets can stabilize further over the weekend in order to mitigate to some degree the ' knee Jerk ' response which would have otherwise been inflicted had the pause in trading and the TH not been effected at all.....
