LKE towards TOP-5, page-20064

"What does the NPV of a smaller stage 1 operation look like…? I’m still finalising my modelling, but suffice to say a $1B MC is unrealistically high."

Here are the preliminary outputs from cashflow and NPV modelling for a Reality-Check 10ktpa operation scenario.
Imo, continual focus on fairytale 50ktpa "base case" operations are nonsense.

Scenario 2-
Key inputs:
- 10ktpa operation; 25 years of production
- Capex: Circa $250M (+ contingency)
- Opex: $8000/t for first commercial product in 2028, increasing at 2% p.a.
- Construction period: 2025/2026/2027
- Product pricing as per the following chart (also shows production ramp-up; 3ktpa-7ktpa-10ktpa)



Key outputs:
- Pre-tax project NPV: ~USD$645M
- Pre-tax project NPV 75% LKE share: ~USD$485M
- Annual revenues, costs, etc:


(Annual net profit peaks at circa $100M, longer-term sub-$50M)

- Earnings Per Share; USD (LHS axis) and AUD (RHS axis):


(EPS peaks at circa 9c per share (AUD), longer-term sub-4c per share)


....Interesting findings, especially when you consider project valuation methodologies vs current market cap vs risk/reward etc etc...

Not advice. DYOMaths.

IMO
DYOR