FEX Valuation, page-451

Hi Rooks,

I will show that even the task of estimating company profit for the current quarter is not simple.

Being an applied mathematician, the method of the interval mathematics should be used for my estimate.

Production: let's assume that the company produced planned 100kdmt/month => 300kdmt/quarter with 5% error (both ways)
Receipts from customers: as per my calculation the average price for 62% Fe is ~US$167, but there are a lot of uncertainties based on when actually the IO was delivered to the customers in the conditions of very large variations in the IOP as well as we know that IO produced by the company has also a higher than 62% Fe rate, so I would estimate that the error here can be at least 10-15%, and the average of ~US167 converts to AU$230 with an exchange rate of AU$=US$0.74.
Let's assume that the total cost for 1dmt was similar as in the previous quarter of AU$140 with an error of 5%.

Based on the above mentioned figures the net cash obtained for the quarter is

AU$27mln with an error of 20-25%, so it should be somewhere between AU$20mln and AU$35mln.

So as you can see with my very limited knowledge about the company activity, there is a big uncertainty in getting the final figure for the profit generated during this quarter.

If my estimates are not correct please correct me.

Hope this helps.

Best,

irynka