LYC 2.89% $5.69 lynas rare earths limited

At 30th Sept LYC had $17 mil cash (burned $21 mil for Sept qtr)...

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    At 30th Sept LYC had $17 mil cash (burned $21 mil for Sept qtr)
    -Insto placement covered deferred Oct $10 mil debt payment.
    -rights issue raised about $68 mil net
    -so cash now ought to be about $85 mil (ann said $81 mil cash post rights issue)

    Dec Qtr:
    -Let's assume Dec Qtr cash burn is $15 mil
    -that would leave $70 mil cash.

    Mar Qtr
    -Let's assume Mar Qtr cash burn is $10 mi
    -loan repayment is $15 mil.
    -that would leave $45 mil cash

    June Qtr
    -Let's assume june Qtr cash burn is $5 mil
    -loan repayment is $15 mil
    -that would leave $25 mil cash

    Sept Qtr
    -let's assume Sept Qtr is cashflow neutral
    -loan repayment is $30 mil
    that would leave $5 mil shortfall.

    So, IMO, the 9c options will have to be triggered
    sometime between April & June 2015 assuming that
    the price of the LYC basket stays as is because LYC is not likely to let
    the cash reserve drop below $20 mil.

    ( IMO, there is as much chance of the basket dropping
    in price as there is of it increasing; hence the assumption
    that the price will remain as is. Also, I assume that there will not be
    any abnormal plant update/repair costs over the next year although there
    has been some mention of a $24 mil plant upgrade.)

    So, IMO, if LYC cannot reduce its cash burn in the next 2 Qtrs,
    then it will have to get the SP high enough before June to trigger the options.

    likely scenario, IMO:
    -a concerted effort to lift the SP in Feb-Mar to trigger the options

    mm
 
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