Agree that FML appear to have had an overspend on anticipated development and exploration for FY 2011 when you look back at what was in the pipeline in July 2010.
If you look at the cost of then unplanned new events (Treasure Island/CRE takeover) and accelerated development associated with the Mount (and I believe one additional open pit), it becomes a bit of a judgement call on whether FML should have spent unforecast expenditure on them.
Results for the September quarter should start to reflect whether the increased development expenditure on the Mount and open pits was warranted, and we may even get a hint on the value of Treasure Island and what CRE will add to the enterprise.
Would agree that there is a need to consolidate any gains made, however think we should also appreciate that we could be up for additional unscheduled expenditure if Treasure Island proves to be a winner.
Just hope that FML does not find itself in a damned if you do, and damned if you don't situation in the next twelve months.
FML Price at posting:
6.1¢ Sentiment: Hold Disclosure: Held
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