Pellet Price, page-52

Hi Olley, I don't think it will get that high. My prediction (model) is as follows:

	Column 1	Column 2	Column 3
0	Asset	Sep-17	Dec-17
1
2	Inventory	20,438,684	20,364,715
3	Receivables	34,510,000	48,261,393
4	Cash	120,340,000	142,565,297
5	Total	175,288,684	211,191,405

The reason why its not higher is, the delay in receiving the cash after the ore has been shipped, so it appears as a receivable at the 31/12/17. I have assumed that of the total sales for the quarter, only 50% will have been received as cash by the 31/12/17. (purely an estimate)

I think GRR are paid 90 days from the Bill of lading. This is only a guess from looking at past sales and cash movements. Some suppliers may also stretch the terms out further.

Also, I assume that all costs for the quarter have been paid out in the quarter. Therefore GRR gets 50% of revenue for the quarter ($48m) and 100% of costs ($58m). The rise in cash in the current quarter, is due to the receivable from the prior quarter of $34m, which will be received in the December quarter.

It will be the March Quarter 2018, where cash should rise dramatically. Providing they don't spend it on a project. ie Receivable of $48m plus cash of $142m.

There are quite a few assumptions in this analysis and many variables to take into account. Assumes 673,000 tonnes shipped for the quarter and production of 670,000 tonnes.

Don't bet the house on it. Well see what happens. Not long now.

DYOR