OTCPK:NNDIF - Post by User
Post by
Bigbird9999on Feb 28, 2017 5:26pm
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Post# 25908426
A closer look at the new agreements
A closer look at the new agreements
Under the current agreements Glencore is CEZ's agent for the sale of metal. They had an agency agreement for this service. Under the new agreement, Glencore has agreed to purchase 100% of the production at LME pricing and so they will be the sole customer rather than a sales agent. . Burried at the end of the metal agreement is a clause where on May 1 Glencore will purchase the entire finished metal inventory. This will result in a huge jump in sales revenue for Q2 . Depending on how much they draw down the finished metal inventory (36000 tonnes at the end of Q3) the sales revenue bump at LME price + premium could be >US$100 million. Imagine the effect on the EBITDA ........Q2 results are going to be deeply skewed.
BB