LYC 2.89% $5.69 lynas rare earths limited

Lynas announcement, interpretation and the truth

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    Let us agree on the following facts before we have a close look at Amanda 's announcement and recent interview.

    It is impossible or even illegal to make a change into the company's previous guidance without reporting it first to ASX.
    If an interview with a CEO carries material information, it would appear on the company announcements. I refer to Eric interview with BRR.
    ASX has a laision officer that will question any company that has passed on any information to the media or analysts that is different from previous announcement.

    With that in mind, now we can analyse what Amanda said:

    The company is maintaining a heavy focus on the ramp up of production at the Lynas Advanced Materials Plant (LAMP) in Malaysia. Over the past quarter further bottlenecks have been encountered which have affected production outcomes. These have been managed and each of the major stages of the Phase 1 plant – Cracking & Leaching, Solvent Extraction and Product Finishing – has individually been operated at target capacity during the quarter.

    Bottlenecks have been encountered in the past quarter (finished, past, gone).
    Phase 1, cracking,leaching, solvent extraction and product finishing , each one has INDIVIDUALLY been operated at target capacity during the current quarter. That is the answer for Jantimot who was concerned about the company , not updating the shareholders about cracking and leaching units.

    So, why did she use the word INDIVIDUALLY. In the official announcements, present and past, nameplate run rate of 11000t has been confirmed on numerous occasions and nothing has changed. It means that June is going to be according to guidance and will be impressive, otherwise , she would be obliged to report to ASX if there is a change to previous guidance.

    The plant is huge and complex, every unit is working well on its own ( the word INDIVIDUALLY), but to integrate all the units to work smoothly as one, she is giving herself time to declare that the implant has achieved stage capacity (December). She is very smart, she knows that investors are watching her carefully. She wanted to make sure that from June to December is a good time to integrate all the units into one. This way any minor issues will be resolved once and for all. Also not to rely on stage two to help stage one.

    I found great comfort when she mentioned that product polishing has been operated at target capacity, that is another indication that stage one does not need stage two for product finishing.

    She also said:
    “We are pleased to report that demand for Rare Earth Oxide (REO) products remains buoyant and that the Company has achieved further increases in production and sales of REO products during the June 2014 quarter,” said Ms Lacaze.

    We remain confident in our ability to sell what we produce and are focused on ensuring we have the most appropriate structure for the Company in order to maximise commercial outcomes for all our stakeholders.”

    "Demand is not the thing which is driving our current production profile. A number of our key customers would happily take significantly more product from us than they are doing today," she said.

    Now they are looking for a reliable source and sustainable supplier like Lynas to protect sustainable growth," Sojitz spokesman Kenta Ishimori said. (Additional reporting by James Topham in TOKYO; Editing by Muralikumar Anantharaman and Lincoln Feast).

    ALL the abovementioned statements mean that demand for Lynas products is strong regardless of chinese and traders manipulation. The Japanese are happy to stock piling Lynas products for future shortage and imbalance.

    WHAT SHE REALLY MEANT IN HER INTERVIEW, that by DECEMBER, the implant will work without any issues as an integrated structure and by December our cash flow will be sufficient to shore the company to a prosperous future.

    * Says project profitable even at current depressed prices.
    Lynas now expects to reach its initial output rate target by December at the latest, which should shore up its shaky cash position, its new CEO said in her first interview.

    Finally, because of this statement, I increased my holdings in the company to two million shares.
    "We have an opportunity here to take something and be significant in a worldwide sense," Lacaze said. "On the other side, there are a few hurdles or mountains to be climbed or pushed over to get to there."

    This is my interpretation to the official announcement and her first interview and my understanding of ASX rules and supervision. Also Nick's mansion with a private sale 4 weeks ago, it will be interesting to see an early settlement and buy on the market which will give the share price a hugh boost and increase our confidence in the market.
    In my opinion, Lynas will be a star and long suffering shareholders will see green future ahead, one will hope.

    Please read, ignore and do not take my opinion as an advice.

    My thoughts and opinions.
 
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