Ann: Quarterly Activities Report , page-9

Hotfire,

Thanks for the offer. I already have a copy of the report. Typing late at night and I put an 'A' instead of an 'I' to make a statement seem like a question.

The thing that worries me about the performance shares is that they really aren't linked to any true value being achieved.

One lot are linked to production targets and the other to JORC targets. But hitting 1.5mtpa doesn't necessarily mean we're making money. If it costs you $10 and you're making $10, there's no return to investors, but they still get their performance shares which dilutes the holdings and actually is to the shareholders detriment. Performance shares linked to profits would have been better.

As for the JORC, no quality or cutoff grades are given. Sure, they can JORC up 150mt, but is that inferred, indicated or measured? Also, at what Fe%?
If the strip ratio continues to be 0.64, then a 150mt JORC would include 100mt of dirt.

The triple shifts are there to get the 2nd lot of PS. If we make a profit, it's a bonus. One would think we'd achieve better economies of scale doing triple shifts, so I do see this as a positive.

The 7 drill rigs are also there to get the 3rd lot of PS. A JORC seems to be useless to me seeing as we're already producing. It will however make us more attractive for a TO, and it should also shed more light on where we should be digging.

As for the liquidity, do you think the Directors will dump a few once the get their PS?

There are also 68m options. I think they're all under 40c, so if there is a TO, they'll be in the money and share part of the pie.

What PE ratio would you place on SFZ should they JORC up 150mt and keep production at 1.5mtpa?