the numbers look a little dodgy to me
the Free cash flow of US$478 million after tax from the first 10 years of operations at US$110/t is fine
this is US$48m pa
but increasing the iron ore price by $10/t does not increase your annual cash flow to $71m pa
without interest, the cash flow after tax at $120/t is around $61m
capex is hefty at $162m
opex is on the high side at $66/t
next announcement will probably be a financing/script/offtake agreement
i was only a very small shareholder here and am out for now
i think the current price is fair and a hold for those with long term inclinations
based on RHM financing themselves on 50:50 debt:equity, I see RHM worth $2.56 come production on $120/t revenue, 5% royalty, 16 year depreciation, 7.5% interest, 30% tax, 150m shares on issue and PE ratio x 8
keen to see the next announcement
regards
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