RE:RE:RE:RE:refineryFor months and months I waded through bs from uninformed bashers of this company. I've said from the beginning the refinery will be an absolute GAME CHANGER. Today was sweet, sweet validation. They have a partner who sees the value in the refinery. And not just anyone. An EXPERT in the cobalt industry. The largest mining company in the WORLD. How anyone couldnt see the value in FCC's refinery is beyond me. You'd have to have your eyes glued shut!!
The margins on the refining side are FANTASTIC. I've posted about the numbers in the past and $US30+M NET PROFIT will be easily attained. Especially now that they are recieving their feedstock from Glencore (higher grade) and are looking to remove the auto-clave bottleneck. Costs will come down from original estimates in study. But let's just assume those costs savings get eaten up by the deal they have to give Glencore for the financing and stick with $30M
In 18-24 months, likely the only pure-play Cobalt junior left standing is netting $US30M/yr. And it's not like this is who they are as a company. The refinery doesnt even define them. Their REAL asset is Iron Creek. IC is what will make them rich. They know this. They just needed to find a non-dillutive way to finance it's advancement. Well folks, today's announcement validates their intentions to fund their advancement of IC WITH THEIR OWN FREE CASH FLOW. So their making $US30M/yr at the refinery AND advancing their core asset. What is the multiple the market gives a comapny like that? If you think it's less than 10 you are LOW. $US300M = $CAD402M. And that's BEFORE they get IC into production. So 2 years from now, I expect this to be at least a $CAD400M company (5.9X today's MC).
I've been saying there was a path to riches here. Prior to today's announcement it was a gravel road. Today, they just laid the first layer of pavement. GLTA