0.5x to 0.8xFor a Definitive Feasibility Study (DFS), which...

0.5x to 0.8x

For a Definitive Feasibility Study (DFS), which represents a more advanced stage of project development compared to a Pre-Feasibility Study (PFS), the valuation multiples would typically be higher. This is because a DFS reduces project uncertainty and risk, making the project more valuable.
Let's break down how this would change our approach:

1. Project Stage Advancement:
A DFS provides more detailed and accurate information about the project, including:

• More precise cost estimates
• Detailed engineering plans
• Firmer production schedules
• More comprehensive environmental and social impact assessments

2. Risk Reduction:
The completion of a DFS significantly reduces technical and economic risks associated with the project, which investors view favorably.

3. Typical Valuation Multiples for DFS-stage Projects:
For DFS-stage projects, valuation multiples typically range from 0.5x to 0.8x of the post-tax NPV. This is higher than the 0.3x to 0.5x range we used for the PFS-stage project.

4. Revised Valuation Range:
Using the same NPV (8.0%, post-tax) of A$354.7 million, but applying DFS-stage multiples:

Low end: 0.5 x A$354.7 million = A$177.35 million
High end: 0.8 x A$354.7 million = A$283.76 million

5. Considerations for Using Higher Multiples:

• The project is closer to potential development
• Financing becomes easier with a completed DFS
• The company may attract more institutional investors

6. Additional Factors:
The exact multiple within this range would depend on:

• The quality of the DFS results
• How the DFS results compare to the PFS (any significant changes?)
• Current market conditions for the specific commodity (fluorspar in this case)
• The company's ability to secure funding for project development