Ann: Quarterly update and outlook - September 2022, page-13

Hi Gratton44,

In trying to understand the smoking ruin that my investment an AMI has become and in reviewing the latest quartiles I am amazed to read that the Sep22Q ASIC for Hera was A$6,317/oz Au eq and in the preceding Jun22Q it was A$2,978/ oz Au eq. I have tried to estimate what the group ASIC would be if Hera was shuttered, but without Au equivalent production figures for all three operating mines it appears to be impossible to do. My guesstimate is that without Hera the group ASIC for Sep22Q would have been around A$2,000 against the actual A$2,643, or an improvement of approx 24% .

So why is AMi still mining Hera's rapidly depleting orebody at a huge loss? To keep our miners employed and to keep the mill running? Investors need to be give some better guidance as to where management expect the economics of Hera to develop as the ore body is mined out. I note that out of A$15.1m of group growth capital invested in the quarter, and well over half, A$8.5 was invested in Hera. If there is to be no profit in it why invest further capital, and why are they ceasing work on the Federation decline while continuing to invest in Hera?

I'm beginning to think the current management is hostage to it's previous poor decisions at Dargues and Hera and is trying to dig their way out by pouring capital into these projects while underfunding the future growth projects such as Federation. Maybe we need an outside team without the historical baggage of Dargues to take a fresh look at AMI's portfolio and decide where best to invest our remaining capital.