Via Briefing
Molycorp misses by $0.09, misses on revs (66.47 -5.13)
Reports Q1 (Mar) earnings of $0.01 per share, $0.09 worse than the Thomson Reuters consensus of $0.10; revenues rose 768.1% year/year to $26.2 mln vs the $41.7 mln consensus. Independent forecasts1 estimate that global rare earth demand is expected to grow from 125,000 metric tons in 2010 to 185,000 metric tons in 2015, and to 280,000 metric tons in 2020. Our estimated capital expenditures of $781 million encompass the cost of restarting mining operations, the modernization and expansion of our Mountain Pass facility, and the addition of rare earth metal and alloy production capabilities. The Company plans to finance its remaining capital expenditure plan with its available cash balances of approximately $492.5 million as of March 31, 2011, and $130 million of proceeds from the issuance to Sumitomo of equity and debt, if that deal is consummated. We expect additional financing from anticipated revenue from operations, and some combination of traditional debt financing, project financing and/or government programs. The Company believes that revenue for the balance of the year will be sufficient to fund operating activities, which include corporate selling, general and administrative expense. The recent earthquake and tsunami in Japan may have a short-term negative impact on market demand in the second and third quarters. The Company expects that demand should fully recover by the fourth quarter.
