bullish on fml bcoz....

Here is a compilation of bullish view by many HC contributers on fml.......


Focus is entering a profitable and self sustaining phase after successfully completing the necessary development to gain stope access to Perseverance and increased tonnages for greater Au output - and made money along the way processing the development ore. They now also have access to the other high grade deposits (Countess and others)which will only be a hop skip and a jump away.

Smart, measured management has seen this project progress through the recent market turmoil that has seen others fall over due to high costs and poor recoveries and reconciliations.

Focus has low costs, excellent recoveries and reconciliations, high grade and between now and the end of the year, will get into the guts of some decent tonnages and Au output

Their target of 54,000 ozs for the next 12 months will see them earn about $2.25m per month after cost of production is taken out. That is a very conservative estimate of $500 per oz profit.Historically, Focus has been very conservative with their forecasts (and rightly so)therefore these numbers are the base case.

Before the end of this FY, FML will be debt free, hedge free, cash positive and self funding all activities. With the Ni price recovering, do not discount a fresh look at Nepean before the end of the FY also.


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FML GOLD Value
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EV/Mineble OZ : 54/1.7 = 31.76
TCO: 509

bullioncmp: 900/oz
per share value = [(bullioncmp - TCO)/(EV/Mineble OZ)]* CMP
= [(900-509)/31.76]*0.044
= 0.54 $
FML is worth 0.54 $ on gold alone

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Salvage value of the processing plant alone is around 5c per share.

Mgt are committed to producing 100,000 oz per annum within a few years which even at $350 per oz profit is around 35 mil gross profit pa. At a p/e of say 10 puts the company valuation at about 350m (1bn shares roughly = 35c ps).