RE:So I did some research here let me know if I am correctI tried quantifying this as well the other day and I get a different number.
Kapulo Assumptions:
Production = 19400 t/y
All-In Cost = $1.92/lb
Copper Price = $3.23/lb
Mine Life = 6.3 y
Discount Rate = 10%
OutstandingShares = 214M
Tax Rate = 16%
PV = $138.6M or $0.65/sh
Cash from PP = $5M or $0.02/sh
Debt = $5M paid back in 2015 and $10M paid back in 2017 plus 12% interest = $-0.07/sh
Tax = $0.10/sh
Kapulo NPV = $0.50/sh Dikulushi Assumptions:
Production = 9000 t/y
All-In Cost = $2/lb (including Ag credit)
Copper Price = $3.23/lb
Underground Extenstion Period = 4 y
Discount Rate = 10%
OutstandingShares = 214M
Tax Rate = 16%
PV = $52.7M or $0.25/sh
Tax = $0.04/sh
Dikulushi NPV = $0.21/sh Kapulo + Dikulushi NPV = $0.71/sh (based on 214 M shares)
If Dikulushi goes as well as my assumptions, all the warrants will be excercised at $0.12 and $0.15, which will increase the number of outstanding shares to 484M.
Kapulo + Dikulushi NPV = $0.39/sh (based on 484 M shares)
The unknown here is how much of a discount the street will place on this project since it is located in the DRC. But assuming these Cu price assumptions are reasonable and a the street places a 50% discount on its Africa risk, I see
$0.20/sh as being very reasonable. So shares at $0.055 is very cheap and you get the additional benefit of placing a low-risk bet on a potential big kick in share price should Cu prices spike in the next two years as I believe they will.
SACKS1 wrote:
MWE
Assets are
156 million NPV based on 3.22 copper
liabilities
50 million
upto 34 million (in the future)
If everything that Galena has asked for happens then there would be 300 million outsanding shares.
50 million
34 million
-----------
84 million
add interest and round up 100 million after repayment
that leaves 56 million on the NPV
deduct the losses in copper 3.22-2.90=.32 represents a 24% loss in npv which brings npv to 42 million
divide that into 300 million shares and u get .14 cents per share value.
Am I correct in my math or way off
This is all based on everything going as planned.