Already holding ~1% in WFE but I'll readily chip more in too at the current Market Cap (~$60m AUD) if I can get in on the Credit Raise. Should be 2.4c too or thereabouts. We're definitely worth multiples of that in the near term once re-listed and in production.
It's been substantially de-risked compared to this time last year. Securing HIGH GRADE ore supply for the short term definitely the key de-risk moment.
That IS the key towards making this business profitable at any Cobalt price or Copper price. 1.0%+ Cobalt beats 0.1% Cobalt, and 2.5%+ Copper beats 0.8% Copper anyday for processing costs.
Based on avg ~1.5% Co grade & ~2.5% Cu grade & ore costs of $60/ton at current Co & Cu prices, with colleague-supplied processing costs, I have done my own purely cash flow analyses and expect:
1. EBITDA for
250ktpa operation around ~$75million AUD for WFE's
50% JV share
2. EBITDA for
500kpta operation ~$140million AUD for WFE's
50% JV share (why else secure 640ktpa supply every year for 2.5 years, if you don't plan to process near that?).
So conservatively, using
4x EBITDA to value the whole Copper Cobalt business alone for a
very typical Junior Producer in development gives:
At
250,000tpa (Absolutely base case): 75mil*4 = ~
$300million AUD Market CapAt
500,000tpa (Highly Suspicious case): 140mil*4 =
$560milion AUD Market Cap
For a well-established producer, it could go upwards of 8x EBITDA (max upside as a full-fledged major producer):
At 250,000tpa (Absolutely base case): 75mil*8 = ~$600million AUD Market Cap
At 500,000tpa (Highly Suspicious case): 140mil*8 = $1120milion AUD Market Cap
Oh, I also wonder how WFE's Hamersley Iron Ore Asset next to FMG is worth now with the recovering Iron Ore interest in that region. Probably could do with a nice net royalty deal with FMG if it ever comes to that.
As always, everyone should do your own research. However, in my opinion it should be beyond any reasonable doubt, that we're definitely worth much more than $60million AUD Market Cap, even only on the basis of getting this plant into production.
