Working TFC over on small volumes - Their playing again, page-57

I agree City1866. This should be a steady path towards a much larger EV over a multi-year period.

In light of the FED rate hike and the USD surge, I should have made it clearer that a lower AUD is overall beneficial for TFC due to:

(1) Only USD denominated cost is the interest payments on the debt. All other costs are AUD based.

(2) Revenue is USD denominated so it is higher when translated into AUD.

(3) USD revenue is greater than USD interest payments so a falling AUD is a net benefit to TFC.

(4) When the USD is rising, the value of the plantations rises by a greater amount than the value of the debt does when translated into AUD. This creates a net balance sheet gain for TFC and a non-cash profit for the P&L - i.e. 'Gain in biological assets > losses on fx translation'.

(5) For US based institutions, the cost of investment, in AUD, falls as their USD rises and this makes TFC's investment proposition more attractive.

Cheers
John