hi daveyjones, the probability of failure is really a matter of subjective assessment, and when you become invested in the company this means that you consider the probability of success as a more likely scenario than the probability of failure (by how much depends on each person aversion to risk).
For me the turn-around has begun, what matters is recovery rates and the steady state production throughput and these metrics have been substantially improved during the current quarter which means whetever the probaility of failure was before the operational turn-around, it is now much lower and the project is more derisked than before. There is still the risk of RMB bank debt restructuring, but if MZI proves profits for the september quarter, i am confident RMB would support the restructuring of debt.
Regarding total debt, you raise a valid point, I took my figure from the latest march company presentation (page 4, key information as at 28 february 2018, total debt : 123.9M A$) and I looked at both RCF and RMB debt figures. Maybe they took more debt from other sources since then ? anyone knows the reason behind the discrepancy (drawn loan facilities : 177,376 Million A$ in the latest quarterly VS 123.9 Million A$ from the presentation) ?
MZI Price at posting:
8.6¢ Sentiment: Buy Disclosure: Held
