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Ann: Consolidation of Financing Arrangements, page-38

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kropka

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05/03/19

08:04

Post #: 37651943
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Originally posted by El Jefe ↑

There is little to clear up.
He is “thinking” Tribeca wanted this and that.
The facts are Tribeca signed off on a $40m Loan with approval for first $20m having very little restrictions, issued straight away and the other $20m facility needing that A40 be ASX listed which it is. There was no number one security holder clause to that loan, that’s just Sydneyguy saying he thinks that what has happened.

A40 could have $53m in debt (plus interest free prepayment debt which would have been circa $65m total) but have decided to cap it and consolidate it at $40m (bit over $50m including interest free Loan with long timeframe repayment), that’s the facts presented to us today in an ASX release.

The other fact presented is they have extinguished a 20% loan from alliance days and reduced that interest rate a little bit. It’s still way too high but they got shafted because they were against the wall needing to get ASX listing.

Im not sure how one comes to the conclusion that this release is a bad thing.

Production was also Reiterated to be on track.
So by my calculations, unless there have been cost overruns, it makes sense what they have done.

32kt in stock end Jan

18.2kt shipped at $880pt

5kt shipped, price say ~$700pt.

$22m + $5m = $27m + $13m cash at start of Q = ~$A40m

Leaves ~10kt still in stockpiles, Boajiang said to take another 10kt this Q, which has been confirmed they did and Feb/Mar prod unaccounted for in these calcs.

Also the above calculations include no sales of Ta, likely a few million from that.
Let’s say conservatively $2m here.

The crucial part was the 10kt going to Baojiang this quarter, should be worth approx ~$10m and then Ta sales that will be breakeven for the Q without using debt facility. So the debt facility of an extra $7m provides a small buffer if no further spod sales this Q.

It’s all quite tight without more sales this Q but there is no way they would have abandoned the extra $13m they could have had to tap into if they haven’t got things running smoothly behind the scenes- production/upcoming sales imo.

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You are spot on @El Jefe

Taking into account experience of BOD I am more leaning towards opinion that consolidation of debt would not take place unless they are convince that more sales are around the corner and current production will deliver enough cash to keep going without doing CR or chasing more loans.

My only concern is how much is allocated for drillings as this is IMO one of crucial infos market is waiting for to assess LOM and future of BH.

A40 Price at posting: 19.0¢ Sentiment: Buy Disclosure: Held
12 Upvote

0 Great analysis

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Ann: Consolidation of Financing Arrangements, page-38

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