sdl financials

G'day Sundancers

I am a bit out of my depth here, but I thought I would have a go at trying to do some analysis on the figures that Sundance have reported, in order to try and work out what sums potential Chinese Investors might be crunching.

CAPEX

Back in 2008, SDL reported that CAPEX was going to be US$3,277m. This was made up of:

$375m - Mining & Plant
$1,423 - Rail
$529m - Port
$442 - Indirects
$508 - Contingency

This was reported back in January 2008, so surely there would be some changes from the amounts reported back then. It has been suggested that the CAPEX is going to be lower then what was originally reported, due to cost sharing. Can anyone provide any evidence about the CAPEX being lower, and what reductions there may be?

OPEX

The latest presentation States that the latest FOB price (60%) is $US63.83/t and the estimated production cost was $US19.65 per tonne, so the operating margin would be $44.18/t

FOB Price: US$63.83/t
Production Cost: US$19.65/t
Operation Margin: US$44.18/t

These are estimated figures from 2008. Does anyone have an idea whether production costs are likely to be up or down on these figures, and whether the FOB price is likely to be up or down?



RESOURCE

The latest presentation suggest the following:

- Prodcution of 35 - 50 tonnes
- A total of 2540MT (215@60% and 2,325@38%)
- A minimum mine life of 20 years.

Is anyone able to confirm whether the maximum production rate will be 50 tonnes per year, or could it be higher. Also, is 2540MT the maximum, or does SDL have the potential to have a lot more then that.

Just a quick point, if you divide 2540MT by 50MTPA, that equates to over 50 years. If you divide 2540 by 20 years, that gives you 127MTPA.


Looking a bit deeper, if we assume they produce 50MTPA at an operating margin of $44.18, in their first year of operation, they are going to recoup $2,209m of their projected CAPEX which is $3,277m, which is nealry 70% of the CAPEX.

If we look at the $44.18pt operating margin against the 2540mt that have got, that is total of $112Billion, which makes the $3.2B look like Chicken Feed.

As i said before, I am a bit out of my depth, so if anyone is able to confirm, correct or add too any of my workings, it would be much appreciated.