roll up roll up, page-34

Come on Fred. The point is people don't invest to just get their cash back.

They need a return so that have to incude deprication/amortisation. Looking at $750 an oz is spurious.

Having said that if you get a plant up an running, you do get cash flow, the plant doesn't dissappear after it's amortized to zero, to the extent you grow you oz of material to put through the plant so the is plently of from for extension/expansion and further profit. That is part of the reason they're looking to halve plant size.

Suddenly return on capital is important. The MD's (note I've said MD's plural 'cuse the co. is top heavy) should be looking around to find any second-hand plant they can get. You can bet the locals in Burkina wouldnt be paing top $US for brand new equipment. What we've got is a whole lot of prima donna's with their hands out designing rolls-royces. Why? Because they've never seen it tough.

It's a tough gig at the moment. But there are lots of alternatives and it's where the much vaunted skill of the management comes into play.

TIA - This is Africa.