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#ASX Announcements
stale
Added 2 years ago

FEX released it quarterly report this morning. Cash costs continue to come down. Now at $78/t down from $84/t (Sept Qtr) which was previously down from $88/t. Hedging extended for 50,000t/m until June 2023. Full results below.

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02624410-6A1133228?access_token=83ff96335c2d45a094df02a206a39ff4

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Valuation of $0.300
stale
Added 2 years ago

13/12/22 Market Cap $143M

Cash 101.7M

Debt $0.00

Enterprise Value: $41.3m = (143 - 101.7) + 0.00

Dividend yield: 21% (share price 0.25cps)

Next Forecast Ex Div Date: 01/09/2023 (262 days away)

13/12/2022 Iron Ore Price 110.3

C1 - Cost to produce: $88.8wmt shipped, compare FMG $15.91wmt

Mine life: 77 months

Tuesday Fe price: $128.00 -3.38 -2.57% (trending down - China would install a central buyer to combat Australia's pricing power.)

Updated: 21/6/21, Quality grade here 60 plus % grade so we can ask for a decent price.

plus, FEX have hedged the price. from memory $180/Tonne

Iron Ridge hosts some of the highest-grade iron ore in WA

Mineral Resource Estimate1: 9.8Mt @ 64.4% Fe

Ore Reserves1 of 7.1Mt @ 64.1% Fe

The Resource offers a premium 2DSO product & compares favorably to DSO products globally

Approx. 1.5Mt of premium iron ore exported to date • High-grade product averaging 63% Fe (to date) - above the 3benchmark DSO product range

29/8/22 Huge divi at 5.25cps fully franked, Ex- dividend 20/9/22

that is 15.44% yield = 5.25 / 34

which is Grossed up value 20% = 15.44 x 1.43

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#FY 2022
stale
Added 2 years ago

Company working to deliver C1 FOB Cash Costs below US$60/wmt. 

2924-02559740-6A1106489 (markitdigital.com)

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#General Meeting
stale
Last edited 2 years ago

shares slide on the announcement: Note iron ore $107.6 per Tonne

Can Craig Mitchell ( Newhaul ) deliver - he is the one receiving the 30Million units and a board positon.

2924-02547810-6A1102285 (markitdigital.com)

RESOLUTION 1 – RATIFICATION OF ISSUE OF SHARES TO NEWHAUL are 30million units x 0.30cps

RESOLUTION 2 – RATIFICATION OF ISSUE OF SHARES TO SCORPION are 4Million units x 0.24cps

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#Bull Case
stale
Added 2 years ago

Fenix came out with their quarterly activities report this morning and it was a bit of a mixed bag.

In the good column they made six shipments (in line with forecast), cash on hand is over $100m and they started paying tax, which will allow them to generate franking credits.

In the other column cash costs were up more than 10% on the previous quarter, production was down and the net result of all this is that although margins are still ok, they are coming down.

I don't usually look at the miners but there's a few things about this one that are a bit different and hence it stays on my watchlist. It's a relatively simple operation to get your head around, even for a numpty like me. At this stage they have a single open pit mine (with some other nearby tenements they may develop), which produces high-grade iron ore that they sell at a premium rate to China. Although it's high grade it's also high cost, mainly due to the lack of nearby rail infrastructure requiring them to truck the ore to their port in Geraldton. For that purpose they own a trucking operation (they recently bought the remaining 50% of that business) of around 25 trucks.

8953f0906dcc8f9112395ee20a780d0296bd2b.png

The market cap is about $150m but as I mentioned they're sitting on $100m of cash so the EV is only $50m. So how can they justify that remaining $50m when you have a falling iron ore price in a high cost operation? They have contracted half of their production capacity at A$230/tonne until the end of September and a third of production capacity from October to June 2023 at A$180/tonne. On my numbers based on just that and continuing to sell uncontracted product at falling prices for the next few months (and then assuming no uncontracted sales), which is a very pessimistic view, that alone gets them pretty close.

Their dividend policy is to pay 50-80% of profit subject to availability of franking credits. The latter bit is a bit tricky to figure out but it's possible they could pay a 20%+ yield this year, fully franked. I doubt you're going to find anything like that outside of coal.

So based on that it almost seems like a no-brainer. Why wouldn't I invest? There are question marks on the Chairman, John Welborn, who is a former Wallaby, and the recent purchase of the remaining 50% of the trucking business did little to put that to bed. They heralded that this would reduce their C1 cash costs by $10/tonne. On that basis you could justify what appeared to the excessive premium they paid, but that was completely disingenuous and ignored the fact they would be up for the significant costs that are not considered C1 and would no longer get the JV profit they previously had (also not included in C1 costs). The level of equity they gave away in the transaction meant the other owner of the JV becomes Fenix's largest shareholder. At least that owner has proven a savy negotiator and they'll benefit from his trucking expertise as he will take up a seat at the board, but they sure paid for it!

c0d35bac1f7c038d37a0c9e1ec7c7c92bef2bc.png

[watching]

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#Company Presentation
stale
Added 2 years ago
  • Release Date: 21/06/22 11:08
  • Summary: Company Presentation - Infrastructure Advantage
  • Price Sensitive: No


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3581ef2c63b9d0941967e23093a767e9f2b14e.png

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#ASX Announcements - Put this y
stale
Added 2 years ago


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Valuation of $0.400
stale
Added 3 years ago

Fenix Resources Ltd (XASX:FEX) is a niche Iron Ore producer based in Western Australia. Their current project is Iron Ridge, a high-grade Iron Ore mine located approximately 70km north-north west of Cue, WA.


  • Average Daily Transaction volume is $567,000
  • Their Price-to-Operating Cash Flow is a very low 1.78
  • Financial health is strong
  • Current PE is less than their dividend yield
  • Yield is higher than the current bank rate



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Valuation of $0.550
stale
Added 3 years ago
Aug 2021 - Maintaining valuation at $0.55 given the success of the first 6 months of production and the perfectly timed hedging arrangement. The recent sell-off appears to be excessive in my eyes given that the current Iron Ore price of $195/t AUD is still a highly profitable level for this business. It is difficult to estimate an FY22 earnings figure given the volatility of the Iron Ore price, but at the current levels of approx $200/t AUD, I forecast NPAT to come in at just under $100m. The current market cap at these prices is around $125m. So hopefully with patience this business will regain past highs and push on again further. Feb 2021 - Iron Ore producer shipping out of Geraldton which had their first ship of IO leave Australia this week. They have a relatively high cost of production at around $80-$100/t AUD, but IO prices for the high grade 64% IO they are exporting are currently above $240/t and climbing. Management plans to export close to 2 ships per month with each ship adding somewhere in the range of $6-8m NPAT. Given a current market cap of around $110m, FEX should clear NPAT of more than its current market cap over the next 12 months. The share price has so far failed to fully reflect the near-term profit opportunity, but I would guess that a re-rate should occur following the March quarterlies and FY21 year-end as solid figures become more easily visible to the wider market.
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Valuation of $0.710
stale
Added 4 years ago
New (Dec 20): NPV which assumes spot of USD157/t and FX of $0.750. Low case of USD100/t is $0.2435 and high case of USD180/t is $0.901 New (Nov 20): NPV which assumes spot of USD129/t and FX of $0.735. Low case of USD100/t is $0.265 and high case of USD150/t is $0.716 Old (Oct 20): NPV which assumes spot of USD120/t and FX of $0.72. Low case of USD100/t is $0.283 and high case of USD150/t is $0.772
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#Business Model/Strategy
stale
Added 4 years ago

Too lazy to re-write. Thesis is here. Since, the co has put everything inplace to sell ore early CY21 https://www.livewiremarkets.com/wires/strike-while-the-iron-ore-is-hot

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