Malaysia Today - Your Source of Independent News

Posted: 25 Aug 2011 11:09 PM PDT

Malaysians are no strangers to skewed agreements. From IPP subsidies to guaranteed profits for highway concessionaires, the public has on numerous times endured the consequences of sheer governmental incompetence. Yet, the 12-year tax exemption given to Lynas may prove to be the biggest blunder ever. Lynas is projected to make about AUD 6.2 billion in pre-tax profit in 2012 and 2013 and in exchange, we allow them to contaminate our land for free.

The graph below shows the spectacular rise in rare earth price since Q3 2010. While gold's bull run has been getting plenty of attention of late, the real star is rare earth, which has taken off to astronomical heights. For Lynas, the price of the rare earths from Mount Weld may increase 15.7 times from JP Morgan's estimate by the time the Lynas Advanced Materials Plant (LAMP) begins production in 2012.

JP Morgan published their stock analysis on 24 June 2010, just prior to the price break out. They have predicted a ridiculously conservative average price of USD 17.69/kg in 2012. At that price, they have expected Lynas to be breaking even in making AUD 4.8 million in net tax profit in 2012. The price has since shot up to USD 201.35/kg on 22 Aug 2011. Based on linear regression calculated from 3Q10 to 22 August 2011, and extrapolated to 1 January 2012, the price may even surge up to USD278.14.

The following table shows our revised estimates based on JP Morgan's research. We predict Lynas will make AUD 2.2 billion in 2012 and AUD 4.1 billion in 2013 before tax based on the above linear regression estimation (if the 22 August price of USD 201.35/kg is used, 2012 and 2013 profits would be AUD1.5 billion and AUD 2.9 billion respectively).

No matter what the price would be, Lynas will be able to repay their entire setup cost of AUD 807 million and still be able to make super normal windfall profit within the first year. The profit is expected to double up in 2013 when production from Phase 2 commences.

Certain important assumptions are made in this deduction, and they are:

a) The revenue is directly proportional to the increase in rare earth price.

b) Rare earth prices are able to sustain at an average of USD 278.14.13/kg. This is justified by assuming that the downside risk of new supply sources is balanced by the upside risk of China's continual pull back in production.

c) Production of Phase 2, which will double LAMP's capacity to commence production by 2013. Construction of Phase 2 is scheduled for completion by Q4 2012.

d) In 2012 and 2013, the AUD/USD rates are 0.95 (rate at 25/8/2011) and 0.9 respectively.

e) Exchange rate has impact on revenue (since rare earths are priced in USD) and operating cost (25% of total operating cost to run the Mount Weld concentration plant is denominated in AUD).

JP Morgan has estimated that the internal transfer price of the semi-refined ores from the Mount Weld concentration plant to its Malaysian subsidiary to be approximately 30% of the finished product price. Consequently, from the AUD 6.2 billion pre-tax profit for 2012-2013, only AUD 1.9 billion will be subjected to Australian tax.

Giving out Free Lunches!

Posted: 25 Aug 2011 11:05 PM PDT

Politics is not an exact science. It is the art of the impossible. Do you not wonder sometimes what the outcome of the 13th General Election will be? Or do you consider yourself amongst the growing number of skeptics that resigns themselves to the inevitability of being saddled with bad politicians no matter who wins the election?

Sometimes I despair at the diversity of it all.

· I support DSAI.

· I am for Najib Tun Razak.

· Anything but UMNO!

· Pakatan Rakyat will only do worse then BN when in government!

· Satu lagi Projek BN.

· PR will stop waste in government spending!

And so the battle rages while we stand on the sidelines and watch. Watch and ponder where our country will be after the 13th general elections!

For me I see no glimmer of light shining through any cracks in the amour of BN or PR within which they all hide from us. To both these antagonists what matters is winning because in Malaysian politics the winner takes it all.

Yes I can see great things happening in Penang with Guan Eng there but already money is being made by party cronies. When big business comes into Penang, big money stands to be made. Not that there is anything wrong in that…nothing glaring wrong as yet…but big business has a way of corrupting those who are within their ambit! Politicians included…especially politicians!

Najib launches initiatives after initiatives – today it is KARISMA as part of Gagasan 1 Malaysia "pillars…in upholding social justice!".

Just imagine a Rm1.4 billion welfare program that will help 500,000 people. If only 10% of that 500,000 people are persuaded to thank Najib by voting BN at the next general election – that is 50,000 additional votes for BN. 50,000 additional votes at a costs of RM1.4 billion ringgit is acceptable to a desperate government fighting for its political survival but (it would seem) still concerned enough to uphold the pillars of social justice"….just as long as they are doing the holding up of the pillars of social justice with OUR money!

What it does to a country already in hock right up to its neck is to be debated AFTER the 13th general elections.

The picture opportunity of Najib, Muhyiddin and Sharizat with that one finger salute is collateral "win win" for UMNO that costs the people RM1.4 billion. That headline of NST "FULL OF KARISMA" should really be "FULL OF S#*T" (to quote that Son of Ali).

Now that Din guy in the Rumah Ministry had a live bullet sent to him - which according to KL CID chief is a threat under Section 507 of the Penal Code for criminal intimidation – and this brave Din guy is not at all intimidated about it. It only strengthens his resolve to discharge his duties and responsibilities to maintain the country's peace and security. Well said Din! I do wish that whoever sent that live bullet to Din will now stop laughing and get a hold of himself. He has had his fun. Din has made all the right noises about "not being intimidated…and national security" and that PDRM CID chief in KL has had his 15-second of fame. Now can we get back to OUR security and maintaining OUR peace?

A quick look through of who Najib is "helping" today is quiet impressive:

Taxi Drivers (our unsung heroes according to NST) gets RM$612,8000 at the Masjid Putra in Putrajaya from Najib & company. According to Najib he knows that these taxi drivers struggle to make ends meet as they earned only RM1,000 a month. Does he knows that half their takings each day are paid out to UMNO cronies that own these Taxi companies? Hell even the uniformed veterans have a Taxi Company that does the same thing! The Taxi companies make the big money – the taxi drivers are not unsung heroes – they are the people who do their daily grind of 12 to 15 hours of work to take home RM1,000 per month while UMNO cronies rake in the big bucks! And were the money distributed to taxi drivers of all races or was it only for the "priceless contributions" of Bumiputra taxi drivers?

And women too! In addressing 5000 women attending the National Women's Day celebration Najib declared women as significant partners in the country's transformation plan…explaining that the having of 30 per cent key position in the corporate sector to be held by women is a target, not a quota. Phew! For a moment there those corporate big wigs listening must have almost had a coronary!

And the financial give away continues with RM9.75 million presented to 127 non-governmental organizations to enable them to carry out their programme!

Through all this I can see that all knowing gaze of Rosmah nodding along with what Najib was saying. In as far as she was concerned she had achieved her 30 per cent quota in her household – 30per cent for Najib and 70 per cent for her!

That about covers it all – from taxi drivers to armed veteran and across the gender divide too. A good day at the office for our Prime Minister.

Kredit: www.malaysia-today.net

Sabtu, 27 Ogos 2011

Malaysia Today - Your Source of Independent News

Malaysia Today - Your Source of Independent News

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