uhmmmmm, I still don't understand. lets stick to the basics for me.
I do not model mining companies - never have, probably never will (I do have some modelling experience though and I am not a junior mining associate based in India... just saying);
I like Nikec's modelling technique also so happy to hear his views.
Conservatively - lets assume production below nameplate at 30k tpa and this doesn't increase; ASIC at $1.65, CU constant at 2.50. This is operating profit of $0.85 per pound produced.
also assume the following:
1. 162k term debt, 10k bridging loan (will be repaid first) remaining debt amortised over life of loan at 8 years; so debt raiment yr1 = $10m or $30m, thereafter $20m
2. Capitalised interest for first year paid in shares (has nothing to do with additional debt as you have indicated), remaining interest cost at 10% pa (just for simplicity as I know it is slightly less). interest yr 1 = $16m
3. Add in whatever you want for corporate overheads and a bit of additional capex etc I will assume $10m (which I freely admit I am plucking the number from thin air)
Total operating FCF = $ 56m based on 0.85 per pound (30k tpa) less $10m for corporate/non sustaining capex/legal whatever, leaves $46m annually to repay debt, service interest from July 2017 onwards, repay the recent bridge loan etc and still contribute something to the bottom line. I think this is being conservative and ASIC is arguably lower (and the current copper price is also higher).
Just making a point here that not all is doom and gloom and I think your numbers above are overly pessimistic (particularly when previous figures you have produced have been fairly sensible). To your last point - if CU is below 2.50 we will never be able to repay debts to 2024, I disagree.
If we look at CU $2.25 (for example) and $1.65 AISC = operating FCF of $ 40m - should cover expenses!!
At the end of the day, models are models and can be spun to look good or bad - I am cautiously optimistic, whereas you are possibly a bit pessimistic; that's fine, but ultimately only time will tell.
Thanks for the debate. Charlie
TGS Price at posting:
3.7¢ Sentiment: None Disclosure: Held