Absolutely nothing in the scheme of things when you consider all the infrastructure now in place including state of the art machinery to churn through upwards of 100 tonnes per hour.
The question is how quickly are they going to start realising cash flow through the newly set-up antwerp sales office. Their current inventory of diamonds along with ongoing production could see +ve cash flow within the next 2 quarters. Not to mention the possibility of one off discoveries & exploration upside. Lets not forget the largest diamond ever found in AU was at Merlin along with blues, yellow, pinks and greens.
As per Empire Capital Report..
Low Range Scenario: Average grade – 15cpht, Price/carat –USD$225/ct to generate AUD$0.12M monthly free cash flow and AUD$1.41M annual free cash flow.
• Base Scenario: Average grade – 25cpht, Price/carat – USD$300/ct to generate AUD$3.05M monthly free cash flow and AUD$36.61M annual free cash flow.
• Blue-sky Scenario: Average grade – 35cpht, Price/carat – USD$350/ct to generate AUD$6.43 monthly free cash flow and AUD$77.14M annual free cash flow.
If the base scenario is achievable then current borrowings are negligible.
