Lately, I’ve been doing a bit of a blog here on the VRM forum so...

Lately, I’ve been doing a bit of a blog here on the VRM forum so I hope I’m not boring too many of you. Anyway, here’s my latest ramble.

I want to dig a little deeper into the feasibility study’s Phosrock price forecast. It’s on page 11 of the announcement, 17 May 2018.

First up, I notice Verdant gave a 2019 CRU price estimate of US$84 per tonne. In January this year the price was already up to US$102.50 per tonne or 22% higher than predicted. (They should have hired me, I would've been more accurate). If prices from here on out follow CRU’s price curve the current NPV is looking great IMO.

But after stating the above numbers, Verdant decided to be conservative and discounted forecast prices by a “further 10%”. So, if I understand this correctly, the 2019 price they used is US$84 minus 10% or US$75.60. That makes the current Moroccan Benchmark price 35.6% above the FS price. As I said, if Phosrock prices follow CRU’s predicted curve from this point forward, then the current NPV is more than double that given is the FS.  

The bottom line here is I think VRM is very badly undervalued. At this price, I’d like to buy the whole company. Yeah, in my dreams.  

Again, if anything looks wrong with my calculations could someone please correct me. Thanks.  

Do your own research etc.    

Over and out.