Lets all try our best to value it. from what I see the picture is looking great but the potential is enormous.
1) Granville. Lets assume we are in full production by 15th December 17
AUD 0.77
Tin US$ 19,580
Tin AUD $25,428
Production 550 TPA ( Yes we may do better)
Revenue TPA X Spot = $13,985,714
Cost per T AUD $15,600.00
Total Cost $8,580,000.00
Profit per T $9828.57
Cash profit Per year $5,405,714.29 ( All this is from June 17 ASX Announcement)
Value how you like, but with the the potential to be a very long mine life with future discoveries. Lets say 10X cash = 54M. You choose your own Multiplier. I always like 10. all this cash would be use to Finance 2.5M capex of Stage 1 Taronga and hopefully no capital raising ( May a nice Rights issue)
Stage 1 is only a tester for Stage 2
Taronga Stage 2 (2800 TPA) Low grade and profitable.
Pointless me trying to do a valuation as one was done in 2014. However much has changed.
At that time the NPV was AUD 100M. Some assumption to be considered are as follows. The AUD was 90 cents US, hence this income side has increased 15% on a similar tin price.
No valuation was considered for the 4.4M OZ of Ag or the 25K T of CU. However at the time it was suggested that it could increase Turnover by 8-13 M Per annum Life of mine. 10 years +
So if the NPV is now say 115M that is tidy.
Now this is where it gets special. The whole idea of the Stage 1 trial mine, is to the following
1) Get a feel for the metallurgy and recoveries. Test the recovery of the by products. Easier to get approval.
2) Test some ore that they feel is significantly higher in grade. ATM we are using grade of 0.16%, however potential exists that depths of 200M the grade may be 1.6%, that is a whopping 10 X times
3) A previous report stated that just a small increase in grade could triple the NPV
4) Phase 1 will finance testing of Higher Grade Supplementary ores from local exploration licenses and LOM extensions Ores. Whatever we find at Torington and Mcdonalds could increase the NPV by 2-3-4-5. Pick a number. These ores would be shipped to the processing plant as they are a few km away. Some of the intersections were recording 2+% recoveries.
I am not a mining specialist in anyway at all, but I am a numbers guys. Once Stage 1 Taronga is in progress ( hopefully we get approval at the end of the month), I would suggest you keep your ear very tight to the announcements. Any increase in the grade or mine extension could multiply the circa 115M NPV of Taronga stage 2
So my Val today would be 54M + 10M + Mt Cobolt
Once stage 1 Taronga is approved at a further 30M
Once stage 2 Taronga is Approved at 70M-90M
If Stage one exploration finds % increase grades or Mine extension feeds, then you can take any number you like between 2 and 5 and Multiply it. + Mt Cobolt
Caveat Emptor. Im not a mining specialist and am happy for you to rip me a new ahole however I have to start somewhere on what the potential maybe.
I may be a bit wrong, but I know a $15M MC that is about to go cash flow positive next month is very cheap with large upside.
Im happy for you guys to adjust and improve, but I think this is better than having a Multiple without any basis.
Feedback on my assumptions would be great, either positive or negative.
Crash
Expand
