Just had a revisit of the annual report to see what kind of profits could be made if this thing goes to plan, and how this would be reflected in a P/E ratio of todays market cap.
They project $3 EBIT per kilo = $3000 per tonne
Current market cap: $93 million
1500 tonnes: Considered break even point from a production cash-flow point of view
3000 tonnes: $9M EBIT pa; P/E ratio = 10
4500 tonnes: $13.5M EBIT pa; P/E ratio = 7
6000 tonnes (max capacity they have under current facilities): = $18M EBIT pa; P/E ratio = 5
Add this onto no imminent potential equity dilution, $9M cash on hand and cashflow positive, potential increase in price of Kingfish or EBIT per kilo, potential of partner in tuna project, research grants from fisheries and agriculture friendly government.
I can see a short term share price double of current SP (around 18c) as a P/E of 20 at 3000 tonnes per annum would not be unwarranted given growth potential. LT speculative price target of 50c if plan executed.
Just my musings, feel free to point out any mistakes, contentions or different points of view. (or agreement!)
Cheers
CSS Price at posting:
8.9¢ Sentiment: Buy Disclosure: Held
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