your interest and DA also seems low if the facilities has 20...

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01/02/24

07:36

Post #: 72174929
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Originally posted by Pete2019: ↑

We can do some estimates on profits. If the EBITDA stays the same for a year at the December quarter, US$135m, then maybe assume a full year is 4x that with nickel prices remaining the same.
4 x 135 = US$520m
Interest in the June half was about US$53m. Maybe this will rise due to further investments, but assume this interest remains the same for simplicity.
Depreciation and Amortisation was $51m in the June half.
So let's say the interest and DA is double the above numbers (2× (53+51)) = US$108m) for a full year.
The tax rate is a bit difficult as NIC has some tax holidays, but paid US$9m tax on US$58m pre-tax profit. So this looks like about 15.5% tax rate. Let's make it 20% to be safe.
So we have for a full year rough estimate for calendar year 2024:
EBITDA = US$520m
minus Interest and DA = US$108m
for pre-tax profit of US$412m (520-108)
Tax this at 20% = 20% x 412 = US$82.4m, say US$83m
NPAT estimate then US$412m - US$83 = US$329m
Exhange rate 0.66
NPAT estimate of US$329 / 0.66 = A$498m.
Now obviously this would be a high estimate in some was as debt will likely be higher with higher interest costs and more expansion may result in more assets, so more DA. But it does assume current low nickel prices. So as a very rough estimate, it should give you an idea of the profit potential of NIC.
Please check my rasoning/calculations as it is always possible to make mistakes.
With A$498m, and 4.3bn shares in issue @ 79.5c it gives a PE of 6.8. This is pretty good if we are at the bottom of the price cycle(but who could say for sure).

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your interest and DA also seems low if the facilities has 20 years life, NIC plonking another $1.3bln USD Will likely increase DA by 65mln a year. Interest alone will increase by 40mln with the $400mln of drawn debt. So more like $150mln give or take on a run rate basis

NIC Price at posting: 79.5¢ Sentiment: None Disclosure: Not Held
1 Upvote

0 Great analysis

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