OTCPK:NNDIF - Post by User
Comment by
Bigbird999on Nov 15, 2016 10:01pm
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Post# 25466503
RE:RE:RE:Advisers
RE:RE:RE:AdvisersArmcorp wrote: I am not of the opinion that any reserve is necessary.
I agree with you on only this one point. For Q4 16 and the first 4 1/2 months of 2017 the current SPA will generate $5 - $6 million per month of cash/EBITDA. This is more than enough to pay the current distribution and the final $15 million debt payment until May when the renewed SPA takes effect.
Post May the concentrate will be supplied at market terms. We don't know, (nobody does) what the TC will be under market terms. For 2016 it has been $207 per tonne. Next year the TC will be lower, but we don't how much lower. The sensitivity analysis says that each $10 reduction in TC changes the EBITDA by about $500K per month. On this basis, the fund could maintain an adequate EBITDA to pay the current distribution with a TC of about $160 per tonne ($50 lower).
At this point I do not think they can justify a dividend cut.
BB