General Discussion, page-181

Interesting to read people's predictions with regard to our initial trading price next Thursday.

Whilst we don't exactly know how the market will value our business, we do have a bit of an idea because 20% of LLL is already being traded on market in the form of FFX shares.

As of yesterday, FFX had a market cap of $270m.

I'm guess their current cash balance is around $70m so that leaves an enterprise value of $200m.

For $200m you get:

20% of LLL plus;
80% of a gold operation which is forecast to produce 150,000oz next year at a gross profit of around A$1,000/oz.

Let's assume that the market is valuing the gold operation at a ridiculously low forward P/E of 1. That makes it worth $120m.

That means 20% of LLL is currently being valued at $80m.

Hence the total market capitalisation of LLL on listing will be $400m.

As a holder, I'm obviously hopeful that LLL will open a lot higher. If we do open with a market cap of $1b I'll be very happy - and I'll celebrate by buying a lot more LLL equity in the form of FFX shares.