$25000 turnover today, page-8

What concerns me is the possibility that, by the time people "wake up" to the "great potential" of graphite, SER may have already squandered much of Uley's potential.

Apparently Richard Karn seems to think SER is planning to declare a dividend to distribute about 80% of what it receives from Mega Graphite while keeping about 20%, receiving 1.5% of royalties from Uley production and (it would seem) have a 33% interest in Mega Graphite (all we know of which is what we read on the mega Graphite website). This could (and hopefully will) add up to a bonanza for the more patient of SER shareholders - firstly through what could be a substantial dividend (hopefully, franked) and secondly through the SER share price reflecting both the potential of the annual royalties and the company's interest in Mega graphite. Added to that would of course be whatever the market sees SER's non-graphite projects as being worth.

But management hasn't given shareholders much detail to do their sums with. At first glance "the deal" as outlined by Karn doesn't sound too bad - but who can be confident of that?

We don't know what 33% of Mega is likely to be worth; we haven't been told what SER is planning to use the 20% it retains on (presumably exploration, but ... ); and we don't know what 1.5% royalties will yield, etc etc.

And, what continues to concern me most is that SER management doesn't seem to think it has any obligation to trust its shareholders with anything but the vaguest outline of what is involved in "the deal". They should remember that we shareholders were savvy enough in the first place to buy into SER and to continue to hold our shares. Surely that alone deserves some respect.

It is hard to believe management will actually squander much of Uley's potential. But their dismal PR hasn't instilled much confidence, has it.

As I wrote earlier today, I truly hope management doesn't now make an announcement until the new financial year has started. But when "the deal" IS finally announced, they have put themselves under considerable pressure to bring home a pretty large portion of bacon for each and every shareholder.

Sunman