Phoenix Copper Share Discussion Threads

[tim000] 15/5/2024 22:11

HZM told its investors how much it needed to borrow and gave precise estimates of when its mine would be in production. It turned out that its paper financial and engineering models weren’t 100% accurate. No one knows whether PXC’s models will be accurate or not, it’s a leap of faith. Enormous upside and only 100% downside. But no one knows which will happen.

[kooba] 15/5/2024 22:06

"The coupon is payable semi-annually on 30 June and 31 December and will be payable on the principal value of Bonds drawn down. The coupons payable on 31 December 2024 and 30 June 2025 will be escrowed at 8.5% with the Escrow Agent, pending payment."Where does it say interest is rolled up into capital%?? This says bi annual coupon payable.

[kooba] 15/5/2024 22:03

But if the funds are drawn to then be held in escrow are we paying interest on those funds as they sit in escrow..I guess so.The company cannot use the $80m in full it appears...so hopefully the cost comes in below that amount and doesn't take too long to get into free cashflow to meet this interest bill.DP if everything is worked out when will they start producing and bringing in revenue...the year and quarter estimate would be fine. Is it dependent on permissions and permitting.

[tim000] 15/5/2024 21:57

The interest will be added to the capital and not repaid until 2029 onwards, when the mine is in production and the bonds are redeemed. In the meantime, the annual interest liability itself accumulates interest.

[kooba] 15/5/2024 21:56

"The coupons payable on 31 December 2024 and 30 June 2025 will be escrowed at 8.5% with the Escrow Agent, pending payment."Surely this means the company does not get the full loan amount as funds are held back in escrow to cover interest?

[bazboa] 15/5/2024 21:50

Thanks DP, how will PXC pay the interest when the mine isn't producing? They can't use the bond. So must come from somewhere else.

[donald pond] 15/5/2024 21:49

Your maths isn't correct: we'd only owe 3.8m for 24 if we'd borrowed the money on 1 jan. Also, I would be surprised if the cost to get the pit into production was the full $80m. But it's all been figured out

[bazboa] 15/5/2024 21:44

If I have read this correctly. PXC will drawdown $40m by the end of the year and so will owe $3.4m in interest by December 2024. The remaining $50m will be drawndown early 2025, so will the interest payment in June 2025 be $6.8m? And then that amount will be payable annually after that? (Or higher if the copper price is high)"The coupons payable on 31 December 2024 and 30 June 2025 will be escrowed at 8.5% with the Escrow Agent, pending payment."

[paulhopeful] 15/5/2024 21:26

Excellent news, Well done management team and long-term holders, congratulations are in order. Looking forward to the next few years.

[scubadiverr] 15/5/2024 20:46

If you were to charge it would perhaps help towards your margin call in the morning! ?

[jbravo2] 15/5/2024 20:38

Do you think I should charge for my insight?
:D

[scubadiverr] 15/5/2024 20:36

You seem to be devoting an awful lot of time to a BB for a share you clearly don't hold

[jbravo2] 15/5/2024 20:30

“So at 20% interest (the cap on bond interest rates) the shareholders are getting so loaded it’s like hitting the jackpot. Every day !”

Blimey, this is hard work.
It’s great when producing. It’s not in the run up to production. You know. The years spent permitting and building the mine. And that’s when you’re talking about them paying off RiverFort.
When you could be borrowing at 15% instead.

[investorman33] 15/5/2024 20:23

JBravo

The copper bonds have a base interest rate and the interest then increases with copper price.

The way the calculation of interest works, shareholders get 80% to 90% of the increase in copper price, interest earners get 10% or so.

So at 20% interest (the cap on bond interest rates) the shareholders are getting so loaded its like hitting the jackpot. Every day !

And Annual report says that out of bond money drilling/other exploration on other properties will take place - so there is plenty of contingency allowed for in 90m.

BTW raising Cornerstone investment is tough - as we've seen with 90m - but getting follow on money once 80m landed (as it has)is far easier. Lots of people will want to give PXC an extra 5m/10m/20m they'll be able to choose the best deal on interest rates etc

[williamcooper104] 15/5/2024 20:12

The $80m is to fund capex not to repay Riverfort They may be able to get cash back on some of their capex wip from the bond proceeds but doubt it's enough to repay RF in totality

[jbravo2] 15/5/2024 19:51

“Why not repay Riverfort, why do you expect them to do anything else - is the most rationale thing to do !”

What if the copper price means the bond is paying 20% interest? Would you still want it paid off? Shareholders might want it paid off but the board might not.

What if the 80m is tight on the forecast budget and has little contingency?

[rainyrain] 15/5/2024 19:49

Still don't know anything about the economics of the project other than it's low grade and low tonnage. Will that equate to low IRR?
Does it even matter anyway i.e., are they just going to build the mine without a full feasibility? Good luck getting fully permitted anyway ROFLMFAO all imho and DYOR!

[juju44] 15/5/2024 19:44

Riverfort are rapists and not good for any company . Get rid now I say

[investorman33] 15/5/2024 19:41

Jbravo

Why would PXC NOT repay Riverfort before they can convert

With 80m in bank and they say in Annual accounts they plan exploration on other properties so PXC has spare cash. Why not repay Riverfort, why do you expect them to do anything else - is the most rationale thing to do !

[cromw3ll] 15/5/2024 19:33

Lol at the bitterness in some. I can wait another 2 yrs, as commodity boom underway as USA especially want security of resources. Share price will be multiple £ in coming years, will nicely fund my retirement as imo hugely derisked now.

[jasperthemonkeygod] 15/5/2024 19:30

but sterling work trying to spin this as a negative thing for the company