I concur with most. One differential is that I had a conversation with management who indicated that there were many options in any soda ash plant renewal. The fact that they had explored it was what surprised me at the time.
I was once close to an old refiner of oil who had a great program of updating parts of the process rather than outright replacement. The key was the fully depreciated plant made it very competitive and updating the areas that made you more competitive was very good for business.
However the issues you raise are very good reasons not to put too much into this one.
I agree completely with questioning a company which reports accounting profits but negative cash flows. They are generally not good businesses.
The points you raise are not only valid but are suitable for asking management. I think that you are totally correct in that they cannot make the price and hence why I think that the vast majority of their profits come from BiCarb. The Soda Ash cannot make money at this exchange rate only contribute to overheads.
I think I will be a lot more careful here than I thought before.
The big issue is the one play scenario if the Soda Ash fails the whole collapses. The BiCarb needs the Soda ash is a very worrying factor - Something I was not aware of at all.
The Mine has for a long time been a worry for me. I just dont get how they are going to clear this "stock" if some of it is even really stock.
only hold a few to be on register.
Your post is really food for thought - Thanks a stack now on one of my favourites.
PSH Price at posting:
47.0¢ Sentiment: None Disclosure: Held
