Project out or Forecast Molycorp's financials from 2012 to 2017 and determine its funding needs from 2012 to 2017 with the help of following exhibits.

Transcribed Image Text:

Exhibit 9 Molycorp Cash Flow Forecast (millions of dollars) Operating Assumptions REO Production (tons, thousands) Percentage of REO allocated to Metals Production Metals production (tons, thousands) REO Price ($/kg) Metal/Alloy Price ($/kg) REO Cost ($/kg) Metal/Alloy Cost (S/kg) Revenue REO Metals/Alloys Total Revenue Cost of Sales REO Metals/Alloys Total Cost of Sales Gross Profit REO Metals/Alloys Total Grass Profit SG&A Other Expense EBITDA Cash Flow Items Capital Expenditures Depreciation Net Working Capital (1) Gross Margin Revenue Growth (2) July-Dec 2012 $ 6.0 63% 3.8 43.2 104.7 26.1 82.1 58 309 367 ****** 334 25 301 Fiscal Year Ending December 31st 2014 2015 2016 25.1% 2013 25.0 32% 80 20.6 58.1 9.3 34.4 158 275 433 192 190 40.0 40.0 40.0 35% 35% 14.0 14.0 815 1,382 273 19.2 63.1 6.0 37.4 70 125 258 97 $ 350 $ 499 $ 506 $513 $520 394 465 908 920 490 1,421 1,441 156 5.23 679 382 703 100 100 9 343 360 883 895 98 35% 593 14.0 45 125 289 19.5 63.9 6.1 37.9 *** *** **** 19.7 64.8 6.2 38.4 45 125 293 160 538 696 353 370 723 103 10 610 45 125 297 46.9% 50.9% 50.9% 50.9% 20.0% 69.6% 1.4% 1.4% 2017 Sources: "Molycorp, Inc.," P. Misra and P. Sood (Morgan Stanley, 8/13/2012); "Molycorp," M. Gambardella, T. Langton, and B. Ossenbeck (J.P. Morgan, 8/3/2012); and casewriter estimates. 40.0 35% 14.0 20.0 65.7 6.3 38.9 163 545 708 358 375 733 104 10 618 45 125 301 50.9% 1.4% Note: (1) Net Working Capital Accounts Receivable + Inventory-Accounts Payable-Accrued Expenses. Values are end of period. (2) FY 2013 revenue growth rate based on annual FY 2012 revenues of $679 million. Exhibit 9 Molycorp Cash Flow Forecast (millions of dollars) Operating Assumptions REO Production (tons, thousands) Percentage of REO allocated to Metals Production Metals production (tons, thousands) REO Price ($/kg) Metal/Alloy Price ($/kg) REO Cost ($/kg) Metal/Alloy Cost (S/kg) Revenue REO Metals/Alloys Total Revenue Cost of Sales REO Metals/Alloys Total Cost of Sales Gross Profit REO Metals/Alloys Total Grass Profit SG&A Other Expense EBITDA Cash Flow Items Capital Expenditures Depreciation Net Working Capital (1) Gross Margin Revenue Growth (2) July-Dec 2012 $ 6.0 63% 3.8 43.2 104.7 26.1 82.1 58 309 367 ****** 334 25 301 Fiscal Year Ending December 31st 2014 2015 2016 25.1% 2013 25.0 32% 80 20.6 58.1 9.3 34.4 158 275 433 192 190 40.0 40.0 40.0 35% 35% 14.0 14.0 815 1,382 273 19.2 63.1 6.0 37.4 70 125 258 97 $ 350 $ 499 $ 506 $513 $520 394 465 908 920 490 1,421 1,441 156 5.23 679 382 703 100 100 9 343 360 883 895 98 35% 593 14.0 45 125 289 19.5 63.9 6.1 37.9 *** *** **** 19.7 64.8 6.2 38.4 45 125 293 160 538 696 353 370 723 103 10 610 45 125 297 46.9% 50.9% 50.9% 50.9% 20.0% 69.6% 1.4% 1.4% 2017 Sources: "Molycorp, Inc.," P. Misra and P. Sood (Morgan Stanley, 8/13/2012); "Molycorp," M. Gambardella, T. Langton, and B. Ossenbeck (J.P. Morgan, 8/3/2012); and casewriter estimates. 40.0 35% 14.0 20.0 65.7 6.3 38.9 163 545 708 358 375 733 104 10 618 45 125 301 50.9% 1.4% Note: (1) Net Working Capital Accounts Receivable + Inventory-Accounts Payable-Accrued Expenses. Values are end of period. (2) FY 2013 revenue growth rate based on annual FY 2012 revenues of $679 million.