All, this is my only post for a while as I dont want to be seen as ramping the stock (all fact in my analysis), but I would just like to share my thoughts in regard to the DFS and THR's enterprise value.
- DFS 2007 based on Tungsten price of US$204/mtu. Today's price is ~US$400/mtu minus discount for concentrates to ~US$300/mtu (lets say ~US$260 if there were a downward price movement in Tungsten - ultra conservative absolute minimum sale price and above 2007 DFS).
- Tungsten reserve has increased by 1,200T since last DFS ~US$20,000,000 of additional PROFIT calculated (1,200T x US$17,000)
- Tungsten grade has increased from 67% to 85% (Flotation step in recovery). Each % increase equates to A$900,000 revenue (Additional PROFIT ~A$16,200,000 PER YEAR OVER LIFE OF MINE since last DFS)
-Moly sale price has remained approx the same since last DFS but has since been upgraded by 46% to 10,400T (increasing credit value)
- Capital cost of setting up operations in last DFS ~A$45M. This upcoming DFS based on ~$69M (An increase of $24M since then which doesn't sound good but is more than offset by increase in grades & favourable prices)
- Mining tax @ 40% - cost
- Underground drilling (DFS figures based on 35% of overall tonnage up to depth of around 220m) and other extension targets to increase mine life beyond 4 years
- Love my last point: 2007 DFS indicated a capital payback period of LESS THAN 7 MONTHS based on data above. Profit wise, considering mining tax & increase in capital cost is offset by higher grades and prices (Hypothetical but reasonable) we are looking at a PAYBACK PERIOD OF 6 MONTHS. The rest is company profit ie retained earnings!
- 2007 DFS: "The DFS confirms that the project is technically and economically viable and it is recommended for development". There's your answer, project is going ahead and I personally have stocked up on units.
- oh, one more thing, throw in JORC 274,000 ounces of GOLD.
- Company valued at 3.5pence which equals around A5.6c.
GL THR Long Termers.
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