Beyond my lower expectations in terms timing, perhaps our disconnect is in "capacity" vs actual production which to me is more important both from opex and fcf perspective.
I do not trade on feelings otherwise I would have pulled the pin on this one a long time ago yet here I am 8 years and counting.
I trade on probability weighted production profiles factoring in what has been promised vs delivered to get a more realistic cashflow projection which tempers my expectations.
To rehash, Nov 2018 FID for Oz 2 - 25ktpa expansion had usd295m capex and commissioning targeted 2h 2020.
Many announcements later and giving some leeway for covid impacts. First production achieved in Jul 2023 (2.5yrs behind schedule) and reiterated confidence in a 12-18month rampup, up from the original 12month assumption on the basis of "prior learnings and s2 being tg product only"
Dec 2023 quarterly straight from the presentation, "oz 2 ramping up to 25ktpa, expect 40% to be available in cy2024". That is the full 18months of ramp up to achieve 40% capacity.
Perhaps that is self induced to meet the market but that is what I am expecting in light of soft market conditions across the board. Opex, capex, production numbers will all miss the mark by a long shot. There is a strong record of creeping timelines, costs and achievements which is hard to argue against.
Aimo
LTM Price at posting:
$4.87 Sentiment: Hold Disclosure: Held
(20min delay)