focus valuation part 2 - acquisition, page-25

Hi Reiner,

The impression I have is that CRE have good projects but have been irresponsible. Way too much going on and too complex for such a small company (uranium exploration too?!)

I can't reconcile their last quarterly costs on anything else than variable costs - eg building the motel. I'm not an expert on drilling and exploration, but they seem to be doing a LOT and way too much drilling too early, yet these costs are really low (exploration and development costs). I'm guessing that some of these costs are included in the production figures.

If FML can come in with clear and simple goals, stop the drilling and spending, I'd think that it would be possible to bring down the production costs down to the original forecasts. However I really would like word on this from focus management instead of guessing. The quarterly figures seem way too variable too me and I can't imagine that they are all fixed costs associated with production.