InventoryInventory at September 30, 2022 was 444.8 CDN million, an increase of 141.1 CDN million since December 31, 2021. Only a portion of that increase comes from an increase in nickel. The total production of nickel for the first nine months of 2022 was 12,022 tonnes and the total sales volume for these nine months was 11,393 tonnes. So the difference of 629 tonnes is the increase of nickel in inventory at September 30, 2022. There is also an increase of cobalt of 268 tons in inventory at September 30 2022 but I don't know the cost of cobalt.
Inventory is valued at cost. The average unit operating cost of nickel for the nine months was $4,39 US per pond. Let's assume that it is the cost of nickel for the 629 tonnes of nickel in inventory.
$4,39 US X 2,200 pounds = $9,658 US per ton.
629 tons X $9,658 US = $6.075 US million = cost
LME Nickel price as at January 20, 2023 = $28,585 US per ton.
629 tons X $28,585 US = $17.98 US million = revenue
Revenue of $17.98 US million less cost of $6.075 US million = profit of $10.9 US million
$10.9 US million X 1.33 (estimate) = $15 million CDN increase in EBITDA
So the increase in inventory value of nickel at September 2022 will give an increase in EBITDA of only $15 CDN million. We are far from an increase of $150 CDN million in EBITDA (I am not discussing the impact on cash, only on EBITDA).