PLS 1.69% $3.01 pilbara minerals limited

I'm a bit more negative taking into account lagged pricing to me...

  1. 193 Posts.
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    I'm a bit more negative taking into account lagged pricing to me means October production priced to price at end of November into December.
    November production priced end of December into January 2024 and December production will be priced at latest available price. This is because sales are repriced to the time of delivery. This can be up to 2 months(month of production plus one for delivery).
    Pricing end of November SC6 CIF China was around US$1500. November and December priced around US$1000 and now around US$875 respectively.
    All depends on time of shipping and delivery. So I may be out by a bit.
    So I estimate average SC6 equivalent around US$1125/t. SC5.3 discount has been 13% compared to SC6 in the past.
    Reducing 1125 by 13% gives an estimated US$988/t of PLS production.
    Cash cost including royalties reduces to about US$600/t by my guestimate due to lower royalties.
    This leaves a margin of US$388.
    Shipped around 160 000t. So that gives US$62m operating profit. Factor in exchange rate around 0.67
    gives A$92m operating profit. Add maybe $20m interest (if the cash pile is earning decent interest around 4%) gives A$112m before tax. 30% tax and we have a NPAT for the quarter of A$78m.
    My assumptions on pricing may be a bit low, but better not to be expecting too much. So I'm thinking NPAT around A$100m or maybe little lower would not be too far off. It comes with a disclaimer of a bit of guesswork. Don't have to wait too much longer to see the real numbers.

 
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