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Bullboard - Stock Discussion Forum Nickel 28 Capital Corp V.NKL

Alternate Symbol(s):  CONXF

Nickel 28 Capital Corp. is a Canada-based nickel-cobalt producer through its 8.56% joint-venture interest in the Ramu Nickel-Cobalt Operation located in Papua New Guinea. In addition, the Company manages a portfolio of nickel and cobalt royalties on projects in Canada, Australia and Papua New Guinea, including a 1.75% net smelter return (NSR) royalty in the Dumont nickel project in Quebec and a... see more

TSXV:NKL - Post Discussion

Nickel 28 Capital Corp > FCF as of 1.1.2022 not yet included in ppt May 2022
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Post by urai58 on May 17, 2022 2:38am

FCF as of 1.1.2022 not yet included in ppt May 2022

The presentation as of May 2022 has been adjusted. Especially with regard to the outlook. A base scenario of $12.50/lb Ni and $35/lb Co is assumed. But the question arises whether the cash flow portion of Nickel 28 at Ramu is included in the figures (which would not be good) or whether these transactions are not yet reflected (which would be very good).
 
In order to answer this question conclusively, the figures at 2 documents ex SEDAR as well as the investor presentation as of May 2022 have to be taken into account:
 
1. CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2021.
 
Debt: $ 78,955,067
Cash: $ 3,843,381
 
 
2. NR dated 30/11/2021 NICKEL 28 FILES Q3 2021 FINANCIAL STATEMENTS:
 
(...) which triggered a US$3.2 million cash distribution.
 
 
 
Investor Presentation of 05.2022:
 
Debt: 79m$ (Slide pdf 5)
Cash: 6m$ (Slide pdf 3)
 
 
Conclusion:
It is very good: The repayment of the CAPEX Debt from the cash flow of Ramu as well as the transfer of the FCF to Nickel 28 will take place on 1 January 2022. This Debt repayment resp. the FCF payment is not yet included in the presentation of May 2022.
 
 
Regarding the repayment of CAPEX debt, the situation is as follows (Ni 12.50$/lb):
 
- As at 30.9.2021: 79m$
- As at 01.01.2022: 65m$
- As at 01.07.2022: 47m$
- As at 01.0q.2023: 28m$
- Per 01.07.2023: 9m$
 
As of 1.1.2024, at a nickel price of 12.50$/lb, the CAPEX Debt could be repaid. The consequences in terms of FCF for Nickel 28 would be dramatically positive:
 
- New share 11.3%
- 100% FCF for the attention of NKL
- Monthly settlement
 
With a nickel price of 12.50$/lb and OPEX Ramu of 300m$, more than 80m$ p.a. could be expected from 1.1.2024.
 
 
urai58 
 
 
Translated with www.DeepL.com/Translator (free version)
Comment by ICNick on May 17, 2022 7:57am
Thanks for the analysis, greatly appreciated. Patience will pay off!
Comment by Michiel on May 18, 2022 2:53am
2024, we are almost there....., and meanwhile, we can already expect 23million in cash flow this year (slide 2), which can be used for a dividend, a new share buyback or accelerated debt repayment. All positive things.....
Comment by ICNick on May 18, 2022 8:02am
All great, and I would like to add that 23m is a 35% increase vs LY.
Comment by Talchior on May 18, 2022 9:39am
Pay the debt is the more interesting one. There are 3 reasons: 1) less interest paid. 2) As soon it's paid, the percentage increase. 3) There is a tax exemption for few years. Pay earlier will allow us to enjoy this one.
Comment by Nemesis on May 22, 2022 4:34pm
Parfaitement exact urai58.
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