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Only think I might caution given the issues in BMN expansion and rather large cost increases, is that having the capital in place for the Capex is one thing, but invariably a whole raft of other costs get added in on the way.
For me, the picture looks solid, on plan and going well, but I rather expect (only born of past experience and not because I have any great ATM insight or additional inside knowledge), that there will be higher operating costs associated with the expansion phase.
Just my two peneth to temper thoughts
And tin traded at 28635 this morning :-). It's having a good run
Yep, forgot the fact that it’s not 100% owned by ATM, thanks for the info bohercon.
So revenue/profits -15%, which makes revenue $81m and profit $35m.
Which was tin at $27k, Petalite at the bottom end of their range at $1600 per ton and no percentage increase for economies of scale. For reference each $1000 change in the tin price equates to a +/- $1.5m change to the profit figure.
Good point on the AISC. They'll have to do as you suggest and break it out.
They've said the Strategic Partner is a lithium-only deal, so the true underlying costs of the lithium extraction will have to feed into whatever arrangement is put in place there. That would then make the tin/tantalum side of the operation more profitable as some of the extraction costs would be shared with the Strategic Partner arrangement.
I wonder what they'll do in future when reporting AISCs?
At the moment, they only quote an AISC for the tin, and say that the tantalum and lithium is produced pretty much for free. When they are saying that revenues from the lithium and tantalum, even at today's prices (forecast to be much higher in a couple of years), will be about the same as the tin, surely they must start reducing the quoted AISC for the tin and pass at least some of that through to the other 'by-products'.
In the overall scheme of things this would, to a certain extent, be window-dressing, but it would highlight the benefits of the economies of scale which are resulting from a move to the polymetallic nature of the business, and the subsequent effective reduction in AISCs.
@rgbuk - good work on this, thanks.
Also need to remember that Andrada own 85% of Uis, the remaining 15% going to the "Small Miners of UIS" government agency. So any expected revenue is reduced by 15% before it gets to Andrada.
The numbers are still extremely promising, and that 15% arrangement must work to keep the government relationship in good shape.
Previously they had no Lithium or Tantalum circuit in the production line. On this ramp up phase next year or so they're introducing the Lithium and Tantalum circuits which essentially will all be "cream on the cake" as AV puts it. They will be produced almost for free as the tin production/AISC carries their costs... hence the projected profit is Lithium Revs -20% + Tantalum revs -20%
Hope that helps
Lithium will be much higher soon, you cant take the current crazy low ....
Early bird - Looking at past fundamentals even when tin was $39k it did not have the impact on the bottom line ie profits that you are suggesting. Costs to get it out of the ground v current spot price means the profit margin is thin. I accept the ramp up will help but think I am missing out on something with regards to reported profits you are suggesting ????
Rgbuk no worries, enjoyed reading your post! Indeed $42m profit per year is quite something vs the current Mcap, let alone when ATM lands its partner to catapult it to phase 2 production.
Beauty with ATM is not only is it sitting on one of the largest Lithium and Tin resources globally, it has a clear route to mid tier $billion mcap *without* the need for shareholder dilution at topco
Good post - thats a baseline 15p on a x10 PE - in 2023 however the average PE for a growing mining company sat at just under x20 - so you could double it, you then get near the last broker target. SL
Fantastic effort . Numbers crunching is always good to reassure yourself you have it right . Always nice to see others helping other investors out also . We are all here for the same reason .
Yep, spot on, I knew I’d make at least one slip up, but at least it’s one that makes the figures look even more appealing.
Thanks for the correction Early_Bird!
From the Q3 results
"§ All-in sustaining cost ("AISC") ³ at USD 30 452 was slightly above management guidance of between USD25 000 and USD30 000 per tonne of contained tin."
Great Post rbuk, always love to see the numbers broken down. Just a quick query relating to the AISC you use is for "Tin Concentrate" when actually the company AISC stated cost I can see is "Containted Tin". Therefore isn't the below correct? (Essentially Tin revenue and AISC cancel each other, leaving lithium revenue -20% and Tanatalum revenue - 20% as the profit)
Tin Revenue $42m + lithium (Petalite) revenue (-20%) $38m + tantalum revenue (-20%) $4m - total ASIC contained tin cost $42m
Gives $42m profit
U.S. to provide more than $2 billion in loans to Lithium Americans project in Nevada.
14, 2024 14:03.
U.S. to provide more than $2 billion in loans to Lithium Americans project in Nevada
The Biden administration will announce plans to provide more than $2 billion in loans to U.S. lithium producer Lithium Americas Corp. The company is developing the largest lithium deposit in the United States in Nevada. A conditional loan commitment could come as early as Thursday, people familiar with the matter said. And the U.S. Department of Energy will provide the loan to the company's subsidiary Lithium Nevada Corp. to build a lithium carbonate processing plant.
This is a huge amount of money and confidence what lies ahead within the Lithium future markets.
Then there's this.
https://www.reuters.com/markets/commodities/china-lithium-boom-slows-sagging-prices-batter-high-cost-miners-2024-03-13/
The lepidolite, spodumene narrative is an interesting one for a company in Andrada's position.
TDT
It's all shaping up quite nicely IMO.
https://www.mining.com/web/the-big-lithium-short-gets-dangerous-on-lower-supply-outlook/
TDT
Good effort rgbuk. I hope you're right.
TDT
Just thought it would be interesting exercise to see what the future revenue and profit were looking like. This is obviously just my very rough estimates so feel free to add/subtract as you feel necessary! Please be polite if I’ve missed any glaring errors as it’s just simply meant as a rough view for me to see where the company is going and it might potentially help others too.
These are figures of proposed increases in operations, I’m not going to amend them as AV has been pretty accurate in meeting previous guidance.
So for revenues:
Tin: 2600 tons of tin concentrate which is roughly 60% tin metal, let’s take $27000 as the tin price.
2600*.6* 27000 = $42m
Lithium (Petalite): 30000 tons which they suggest they can sell for between $1600 to $2200 per ton, so let’s take the low end.
30000 * 1600 = $48m
Tantalum: 83 tons but this is a concentrate of about 24% tantalum oxide. Tantalum oxide sell for about £250000 per ton.
83 * 250000 *.24 =5m
So all in all roughly $95m revenue.
Ok, so profit/loss
The ASIC cost in the last set of figures was just over $30,500 per ton of tin concentrate. That included the advanced stripping and the Orion royalty. We can assume that additional stripping will not be required for several years which, let’s be very conservative, brings the ASIC down by $1000 a ton, also the new ore sorting will reduce the ASIC by roughly 10%.
So the ASIC reduces to roughly $26.5k per ton of tin concentrate.
We are all aware that the petalite and tantalum processing costs are low due to the fact they are a ‘by product’ of the tin processing, but let’s say we take off 20% for their processing, shipping, etc.
Tin Revenue $48m + lithium (Petalite) revenue (-20%) $38m + tantalum revenue (-20%) $4m - total ASIC tin concentrate cost $69m
Profit $21m
Obviously this does not include any economies of increased throughput.
We obviously then have the next phase of lithium (spodumene) and potentiality tungsten, copper and more tin.
As a long term holder I’m very happy with the way the company is progressing and look forward to more exciting news to come!
I think this behaviour goes with AIM shares, some pi's see the drop, then realise they could of sold at say 4.90 in this case, but they feel it could drop further and panic selling now, their method is thinking they keeping the powder dry, though it could well not drop anymore and rise up, so you selling for a loss due to the transaction fees and a spread.
All IMHO
I think we all know that stock markets by enlarge are both irrational and unpredictable but I do find it so puzzling when u see 2/3 days ago it’s was 4.90 -5p to sell and obviously a fair few did and I get that after the recent rise too but what I do find odd is like today why would anyone be selling at 4.4-4.5 when they could have done at 4.9-5 p 2 days ago …
A couple of new articles, nothing really new in them from what I can see.
https://miningandenergy.com.na/andradas-first-tantalum-shipment-set-for-march-2024/
https://theextractormagazine.com/2024/03/13/andrada-anticipates-tin-concentrate-production-to-increase-from-1-500-to-2-600-tpa/
Not with $35mil in the bank
SP action odd with a large spread on the back of Tin heading north. I wonder if they are look at a raise in the background