On page 3 of the 2017 annual investor presentation Orocobre declares their gross margin at 62%, and their EBITDA at $71.2M. Against sales of $120M, this implies an EBITDA margin of 59.3%. Somehow all of the other operating expenses of the company are only 2.7%.Can someone help me understand where in this arrangement of things are they putting the operating costs of the plant? Is that being averaged into their cash cost for lithium, or is that operating cost being placed into the additional costs between gross margin and EBITDA?
When I look at economic assessments of junior lithium producers, what I ordinarily have seen is a fixed calculation of cash costs for lithium extraction, and then the plant operating cost - which is usually huge - is declared as a separate line item. For example, Neo Lithium's PEA contains these costs:
Cash operating expenses $2791 / ton
Plant operating expenses $97.68M / year
That kind of disclosure makes it much easier to calculate the company's level of profitability at different production volumes.Does Orocobre ever break it down at that level?
ORE Price at posting:
$6.94 Sentiment: Hold Disclosure: Not Held
