Forum Topics FEX FEX #FEX

Pinned straw:

Added 9 months ago

I've been a long time holder in Fenix Resources, an iron ore miner up until now focused on the mid-west region of WA. With transport and port facilities out of Geraldton, it's been a solid investment, in particular with the early dividends paying 50% of my purchase price. The share price has stagnated recently, for obvious reasons, however the latest announcement that Fenix have acquired CZR resources and their Pilbara assets has me wondering if this is more of a 'buy' than a 'hold' investment. Or maybe sell? I am working on some scenarios and will come back with them when done however wondering if any other members have an interest in Fenix and what their thoughts are?

BkrDzn
Added 9 months ago

I haven't done detailed numbers as I haven't been in FEX for ages but diluting ~30% to most likely at least double production should be accretive as longs as IO stays above USD90/t for 62%. CZR's last study (late 2023) had $110m in capex with an NPV8 of $256m at USD90/t. Spot is USD100-105/t atm so NPV probably +/-$500m atm(?). So say capex of $140m (~25% inflation), opex up 5-10%, and taking of the acquisition price, net NPV on deal basis maybe $300-400m post tax. In theory, deal would be most accretive if FEX can internally fund it and probably would require no divs for a bit longer. Raising the capex in equity would likely make it much less interesting.

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