Was going through numbers and latest reports in my head this morning and I think the company's strategy on financing is quite simple.
We know that they need about AUD10mln in the first half 2024 for stage 1.5 if they want to keep ramping up beyond the current production of 240kt per annum. That 10mln includes working capital.
The company has been emphasising how much product they have in the production pipeline (100kt at various stages from memory).
We know that the sales price for December quarter was around AUD270 per tonne, we also know that was profitable on a per tonne basis.
The company has been talking about security for debt in the form of product stockpiles.
If we assume that the 100kt of product in the pipeline is worth at least AUD100 per tonne for security purposes that's AUD10mln in itself.
Then the profit margin on the 120kt sold in the next 6 months should be at least AUD50 per tonne (conservatively) and that's another AUD6mln towards the expansion in the second half of the year.
CXM Price at posting:
7.8¢ Sentiment: Buy Disclosure: Held
