Righto, here goes... I have tried to provide some more detail...

Righto, here goes... I have tried to provide some more detail for the sceptics. I am no analyst, just an average punter, so there is a high probability of some variation to my numbers. That aside, what is wrong with a good ramp? Is it not in everyone's best interest to promote shares that they are invested in? WTF is the point of this site if not to promote one's own interests?

Anyway, I have a day job and need to get back to it... (At least until GMM trades $1+)

Spodumene at US$600/T and 75c AUD/USD = AUD$800/T

AUD$800 x 120K = $96mil minus 10% for royalties and marketing gives you $86mil

Add $15mil from the tantalum (Incorporates a 5% royalty) and you have Revenue after marketing and royalties of $101mil

As stated in the announcement dated 12th October 2015 the INDEPENDENT study conducted by Ertech states that the Total operating costs are AUD$48/T ($333/T of spodumene)

At a throughput of 800KTpa this equates to Total Operating Costs of $38.5mil add in $1.5mil for corporate and you get an even $40mil

$101-$40 = $61mil

Now let’s look at a more likely scenario…

Spodumene at US$900/T, exchange rate of 70c AUD/USD and throughput of 1.2MTpa (180Ktpa of Spodumene).

US$900/.7= AUD$$1,285/T

AUD$1,285 x 180K = $231mil minus 10% for royalties and marketing gives you AUD$208mil

Add $21mil from the tantalum and the get Revenue after marketing and royalties of AUD$229mil

Total Operating costs are now $57.6mil lets call them an even $60mil with corporate.

$229-$60 = $169mil GMM’s share is half so $84.5mil

Profitability aside, with Talison locking up all supply with their vertical model and Neo being bent over by Gangfeng, GMM/GXY are the only group globally that can legitimately supply the spodumene market in the next 2 years.

And here’s another fun fact that shows the price of lithium could go up 10x and not impact the commerciality of Lithium Ion batteries… The lithium raw material in a Li-ion battery is only a fraction of one cent per watt, or less than 1 percent of the battery cost. A $10,000 battery for a plug-in hybrid contains less than $100 worth of lithium.

Cheers

The Doc