Project CAPEX and Working Capital Comparisons, page-86

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Tcb007

19,298 Posts.

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20/09/20

18:54

Post #: 47486078
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Originally posted by Scarpa ↑

I posted in FYI a while ago, Post #: 44501315, and its move to HPA is a necessity as against a staged approach for ADN. The staged approach for ADN allows for less dilution, i.e upfront capex is actually not too bad for a 2022 production start date here, in the sense its various stages of subsequent production can be self-funded, but obviously FYI is likely to get to HPA production before ADN.

Albeit ADN has about 2.2 billion shares on issue, whereas FYI have about 300 million on issue, so despite the higher upfront capex cost for FYI, and given where its SP is, I suspect it will end up with about 1.5 billion - 2 billion shares on issue (assuming equity for Offtakes type financing etc), depending on how financing works here and SP at time of equity deal.

Anyway, on this issue of dividends for ADN holders I suspect under the staged development, whilst ADN may pay dividends it may not be as significant as some think in the first few years, as they meet each stage of production objectives (been the short, medium and long term strategy) so a portion of profit will become retained earnings for subsequent stages capex expansions. The question for ADN holders becomes how large is the portion retained and what dividends are initially paid, but ultimately I would be expecting some decent dividend distributions in future, assuming projects, and expansions, run as specked and prices come in as assumed from any (subsequent) financial studies etc etc.

Posted for balance, as I don't see it as a competition between FYI and ADN holders.

All IMO

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I nearly choked on my weet-bix this morning when I saw 2b shares.
At 300m soi, FYI will have the same amount of cash as ADN once the 1.2c options are converted, approx $10m
After 12 months of being completely ignored by the market, FYI is slowly gaining traction now and imo will have a market cap closer to $150m-$200m before they draw on any capex. The GEM was signed when the market cap was $10m and I'm very confident more favourable funding arrangements and options will be available for this tier one project & I also 100% agree there's no competition between the ADN & FYI

ADN Price at posting: 9.8¢ Sentiment: Buy Disclosure: Held
2 Upvote

0 Great analysis

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