Personally, I have stopped using the Q2 financial statements to conclude anything, as Q2 is right smacked in the middle of the merger effective 14-Dec-2018, and much of the information presented in the FS are raw information with some confusing figures from the merger. For example, if you look at the revenue for Q2, you will notice that it recorded only the revenue of A$14m from the sale of 2 shipments of spod concentrate totaling 11,185 dmt, being Tawana's 50% share of Bald Hill shipments which occurred prior to the completion of the merger. So they have not taken in the Alliance's 50% share.
So, basically, the Q2 FS seems to be presenting information that is combination of the following
* Tawana's revenue+cost from 01-Oct-2018 to 13-Dec-2018 (ie. Alliance revenue+cost during this period is not part of the group and therefore excluded)
* Group's revenue+cost from 14-Dec-2018 to 31-Dec-2018
So, my question is the Tantalum sales credits, while not specifically stated, is it for Tawana's portion only? What about the other items in the FS?
Without knowing exacting when they shipped the 51,000lb of Tantalum, it's hard to conclude which part is which, not to mention the Ta sales price per lb.
Secondly, we know Tantalum market price is around USD 70-90/lb. It doesn't sound right to conclude that Alliance is selling Ta at A$27.40/lb (ie USD19.5/lb). You have the right to make whatever out of the FS information. I have my right to doubt the reasonableness of that conclusion.
To me, the whole point of dissecting the FS is to extract key information to make sense of where the near future lies. But the information presented in Q2 FS does not fulfill that purpose (with mix of information before and after merger). Hence, I have decided for myself to put the Q2 FS aside (good for some basic reference but not use it to conclude anything serious) and focus on Q3 (clean start).
Have a good day folks.
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