Think you may need to re-read the half year report, I think this...

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seanc_au1

279 Posts.

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19/03/22

20:08

Post #: 60296286
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Originally posted by heymj73: ↑

I recall that prior to the last capital raise a requirement of the debt facility was to lock in a declining proportion (over the first few years) of the annual production at a hedged sell rate (or something like that). The requirement had the effect of negating any NP upside for that production over those years.
The NP, prior to this recent spike, was doing better than the original finance hedging terms, so it would have been a less than ideal situation (i.e. MCR would have been leaving money on the table due to finance requirements). I have not been back through it, but i'm hoping that the last Capital Raise, and the resulting retirement of that debt facility, also means that MCR no longer has the fixed hedge requirements on those initial years of production (albeit partial production).

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Think you may need to re-read the half year report, I think this also explains the price action as NP has been going up.

The Group’s total liabilities were $92.0 million (30 June 2021: $37.0 million). The increase was predominately due
to the negative mark-to-market adjustment on the mandatory nickel hedges of $16.7 million during the half
year, additional borrowings with the draw-down of the RCF of $28.7 million (net of borrowing costs capitalised)
and increase in trade and other payables of $7.9 million.

MCR Price at posting: $2.04 Sentiment: Buy Disclosure: Held
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0 Great analysis

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