Interesting thing about announcement, is that you have to refer to GBG March quarterly report.
Karara shipped 1.45m tonnes of Magnetite but also 922,000 tonnes of DSO. We are not told what grade the DSO but I expect Karara would be getting a lot less than $50 per tonne.
Not out of the woods yet.
As far as actual sale price of processed Magnetite, GRR sold magnetite pellets at $US68.23 per tonne in June Qtr which is a lot more than 20% premium on $US50. See GRR June Quarterly Report.
GRR grade 65%. See GRR AGM presentation 13 May 2015.
I understand that pellets have a premium to concentrate, but unable to find what the premium is.
Karara exporting 65.8% grade. If Karara gets to 68% Fe content, price may be in order of $US70 per tonne.
Financing costs on $US2billion - anyone's guess 5%? Well that's $100m pa.
If exporting 6m magnetite with margin $US20 gives $120m margin. I would expect that DSO would not be making much if at all.
If one excludes depreciation then Karara may be breaking even, but still a long way to go to get 8m tonnes of 68% magnetite.
At last we have some figures to work on!
GBG Price at posting:
2.4¢ Sentiment: Hold Disclosure: Held
