Once again into the breach, page-46

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niu

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28/09/16

18:51

Post #: 19486859
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Originally posted by nrcmedia ↑

Is this supposed to make me feel good about my money? Money will flow back in the next two years. I have been waiting since December 2014 for the opening. I realize the trials and tribulations of opening a new project...but I don't see any money coming back to shareholders for a few years Richard. Not sure you can ask people to wait 4-5 years to make money when you are making 2 to 3 times the amount you initially calculated for the sales price....?! Build a plant based on $5000 a ton and get $12,000 and can't make it work for shareholders....I don't know.

"In a year's time"

$100 million to subsidiary company"

"money will flow back in two years"

"backend of next year" ?

This is the closing paragraph in the synopsis:

In a year's time, I expect Orocobre to be in a very strong position. We have a low cost business, we're producing increasing amounts of product and we'll have strong cash flows through this year. So our balance sheet will improve. There's about $100 million worth of shareholders funds that have been put in, in terms of short-term funding to the subsidiary company. That money will all flow back to our Orocobre in the next two years. And at the backend of next year, we should be in a position whereby we'll be building our expanded projects, with the aim of having production kicking off at the backend of 2018, and ramping up into 2019. So in the past years, we've had our trials and tribulations, we're in a strong position now and we'll have a good year I'm sure.

Expand

So $100 million worth of shareholders funds are in the process of flowing back to ORE right now and will be fully back in ORE coffers within 2 years. Meanwhile SDJ will also be 3.5 years in to paying down their ten year Mizuho debt facility,making for a much stronger balance sheet.
So what to do with all that cash piling up back at ORE - return capital to shareholders or invest it back in to expansion?
$100m among 200m shares is 50c/share to be returned to shareholders.
Alternatively, it would fund the expansion from 17.5 up to 35 - 42.5ktpa. A business 2 to 2 1/5 times bigger than phase 1 nameplate...
Which will do more for the share price?
Personally, I'm more than happy to see the cash ploughed back in to growth.

ORE Price at posting: $3.59 Sentiment: Buy Disclosure: Held
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