LLancaster GroupCredit committee
Credit committee paperSection 02 / 07

02 · Corridor

The export corridor and cash cycle

Lancaster funds only the logistics leg: R810/t of road and rail that Arnot must pay before coal reaches the vessel. The cargo and the LC sit behind every rand advanced.

Exhibit 2.1 · Physical flow

Mine to vessel to collection account

1

Arnot Mine

RB2 loaded

FOT R800/t

2

Road haul

To Sunberry siding

R150/t

Funded 80%

3

Transnet rail

Incl. port handling

R660/t

Funded 80%

4

Durban Port

FOB vessel

$121/t

5

LC proceeds

Collection account

Repays Lancaster

Note · Gold stages are the invoices Lancaster pre-finances. Advance per cycle: R32.4m (80% × R810/t × 50kt).

Exhibit 2.2 · Interactive

Walk through the cash cycle

Drag the day marker to see which tranches are outstanding and what Lancaster has at risk.

Day of programmeDay 35
Cycle 1Loaded, awaiting LCR32.4m
Cycle 2Railing to portR6.5m
Cycle 3Not started
Drawing on invoices Loaded, awaiting LC Selected day

Principal outstanding, day 35

R38.9m

of a R50m limit

Exposure rises as invoices are paid, peaks while one cycle awaits its LC and the next has started, then drops back as proceeds land in the Lancaster-controlled collection account. This walk-through shows principal only; the R44.3m facility peak also allows for accrued interest and invoice timing.

Exhibit 2.3 · Timeline

Key milestones per cycle

  1. Step 1

    Day 0 to 30

    Lancaster pays 80% of road and rail invoices as coal moves to port

  2. Step 2

    Day 30

    Vessel loads at Durban; B/L and inspection certificate issued

  3. Step 3

    Day 40

    LC pays at sight into the collection account; tranche and interest settle

  4. Step 4

    Monthly

    The next 50kt cycle starts; peak exposure is R44.3m when cycles overlap