As I was not able to fly all the way from Wellingto to Perth - I called up Michael Humes and had a good chat.
Very informative, upfront and honest. I have faith in this guy - seems like a good team.
Michael noted that they would hope to get at least 75% or more debt financing for Roseby and URL is/will approach many financing houses. Therefore, expect a good financing package if Roseby goes ahead. Also be aware that URL most likely will have to raise further Working Capital once the commencement of Roseby is a goer. Roseby is expected to cost around 238m (US) - then possibly add a futher 12m onto this for working capital (a guess). After doing your numbers - you will see that even with the dilution of Working capital during Roseby construction - debt financing will still most likely average 70%
On the demand side - I have been digging into the prospect of future hybrid cars being increased in the years to follow. I am going to call up Toyota in Japan and see what their view is on future hybrid car manufacturing. Should hybrid cars start picking up (a few sales yards in NZ are importing and selling hybrid cars). Some of you may be asking what on earth a hybrid car has to do with URL. Hybrid cars runing on petrol and then coverting kinetic energy into stored battery energy use twice as much copper than a standard car. Take into account the fact that many millions of vehicles will be produced in the next few years, then assume 30% of these will be hybrid cars - that is very good news for URL with their copper reserves.
URL Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
