That is great news, makes it even more profitable! Here is...

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merwej

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26/03/24

14:26

Post #: 73064786
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Originally posted by HOOPZ: ↑

Aside from not deducting interest before calculating tax, you have still neglected to include the depreciation benefits which are particularly favourable in Argentina. Argentina provides accelerated depreciation rates for mining activity allowing plant (which includes wells and ponds) and equipment to be depreciated within 3 years.
In the model below I have used a 20% depreciation rate. The other thing I have done is use the 79% chloride payability that is now being used in the Phase 2 DFS. Obviously, they have had more discussions (between release of the Phase 1 and Phase 2 DFS) with respect to payability which has increased their confidence of achieving a higher rate. So using your spot price I have a FCF of over US$25m which would see the loan paid off in 3.46 years. Using US$19.5k LCE and a slightly less aggressive interest rate (of 12%) would see the loan paid off in a little over 2 years.

Lastly, a temporary spike in spot price as the pricing pendulum swings back in the other direction could see the loan paid off in less than a year (e.g. US$40k LCE - which is certainly possible, given the rate of EV adoption and how immature the industry is). I certainly look forward to seeing your spot price valuations (which you have taken to like a duck to water) when we are on the other side of the cycle.

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That is great news, makes it even more profitable! Here is hoping we get news about the finance soon.

GLN Price at posting: 37.5¢ Sentiment: Hold Disclosure: Held
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0 Great analysis

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